OBJECTIVES: Whether the use of alvimopan is cost-effective, compared to the standard post-operative care, for post-operative ileus (POI) among patients undergoing small- or large-bowel resection via laparotomy. METHODS: We constructed a formal decision model from the health care system perspective. The clinical outcomes (time to discharge order written [DCO], post-operative nasogastric tube insertion, POI-related readmission within 7 days, nausea and vomiting) were obtained from meta-analyses of published studies.  Cost inputs included costs associated with the drugs, nursing labor, readmission, and hospitalization.  Cost-consequence was assessed by determining the net cost of alvimopan use and subsequent reduction in length of stay (LOS).  Sensitivity analyses were conducted. RESULTS: The alvimopan drug cost was $570 based on an average of 9.5 doses.  Given the 18.4-hour mean reduction in DCO, the use of alvimopan reduced hospitalization costs by $2021.  In the base-case, alvimopan resulted in a $1187 per-person cost savings. In sensitivity analyses, the result was robust to changes in key parameters including the cost and number of doses of alvimopan, DCO, readmission rates, and hospitalization cost. In scenario analyses, alvimopan use yielded a cost saving of $897 when no difference in readmission rates was assumed.  However, when no difference in DCO was asssumed, the total cost of care with alvimopan was $278 greater. Similarly, it was $569 greater when both readmission rates and DCO were assumed to be equal between strategies.  In Monte Carlo simulation, the mean difference in overall cost of care was $1252 (95% certainty interval: -$398 to $6306), favoring the use of alvimopan.  CONCLUSIONS: The overall hospitalization cost reduction associated with the use of alvimopan offsets the drug cost.  Alvimopan appears to be cost-saving for POI among patients undergoing bowel resection via laparotomy.  This finding is not applicable to the less-invasive laparoscopic surgical approach which has been associated with decreased post-operative morbidity and LOS.