OBJECTIVES: Assess the impact on healthcare utilization and expenditures of treating patients early with disease modifying therapy (DMT: interferons or glatiramer acetate) rather than delaying until patients have met full diagnostic criteria of multiple sclerosis (MS). METHODS: A retrospective cohort study using insurance claims data from the Marketscan® Research Databases (2001-2008) enrolled patients prior to documented MS (1 inpatient or two outpatient claims with ICD-9-CM 340 on different days).  Enrollment criteria were: 1)brain MRI (index date); 2)at least 1 MS symptom 6 months prior or 1 month post on non-diagnostic claim;  3)treated with DMT post index; 4)no documented MS or DMT during the year prior. Treatment cohorts were Early DMT (DMT claim prior to the first documented MS) and Delayed DMT (DMT started after documented MS). Comparisons of hospitalizations and expenditures during the first year of follow-up were adjusted for baseline differences between treatment cohorts using inverse probability of treatment –weighted (IPTW) regression (general linear model for expenditures and logistic for hospitalization). RESULTS: There were 227 (5.7%) Early DMT and 3,724 Delayed DMT. Number of days from index until start of DMT therapy was (122 vs. 184, p <0.001) for Early vs. Delayed.  Hospitalizations were 10.1% vs. 16.5% (Adjusted OR 0.51, CI: 0.32-0.81).  Adjusted per-patient annual expenditures for Early vs. Delayed were:  Total: ($28,280 vs. $29,102, p = 0.44); Total excluding cost of DMT: ($15,214 vs. $17,630, p = 0.008), MS-related ($9,365 vs. $13,661, p <0.001), MS-related excluding cost of DMT ($988 vs. $4,907, p <0.001). CONCLUSIONS: Early treatment with DMT was associated with fewer hospitalizations and lower MS-related expenditures. Although overall expenditures were not significantly different, non-DMT expenditures were lower in the early DMT cohort.  This indicates that the higher drug expenditures of early treatment with DMT were offset by savings in other medical expenditures.