OBJECTIVES: With the introduction of the bundled payment model in 2007, a large number of disease management programs (DMP) were initiated in the Netherlands. It is hypothesized that bundled payment will improve the quality of care en encourages tasks delegation and substitution. As result, health care costs may decrease resulting in efficiency improvement of diabetes care. METHODS: We analyzed insurance claim payments of 24 different insurance agencies of the Netherlands using data of Vektis. Data of 52 care groups, covering about 50% of the diabetes type 2 population were used. In total, 61,497 diabetes type 2 patients, clustered in 3078 GPs, were analyzed in a longitudinal multi-level design. For two years 32% of the patients (or their GPs) were enrolled in a DMP based on bundled payment and 21% in a DMP based on management fee whereas the patients of the control group (47%) stayed in ‘care-as-usual’ (CAU). RESULTS: Results show increasing curative health care costs of Euro 219 per patient from 2008 to 2009. While controlling for age, sex, comorbidity, and costs at baseline (average yearly costs in 2008 were Euro 4123), the average costs per patient enrolled in DMP based on bundled payment increased with Euro 288 more compared to CAU. The increase of costs of DMP based on management fee was not significant different from CAU.  The increase in costs did not vary between health insurance agencies or GPs. Sensitivity analyses were conducted with a much smaller and therefore less useful 3-year data set. Substantive conclusions remained the same. CONCLUSIONS: Results showed an increase in curative health care costs of diabetes patients caused by DMP based on bundled payment over a period of 2 years. Further research should investigate a longer time-span to study long-term effects of DMP on costs.