OBJECTIVES Some drugs increase risk for adverse effects in elderly patients. Accordingly, lists of potentially inappropriate medication (PIM) that should be avoided in elderly patients have been proposed. In 2010 an expert panel published a PIM list adapted to the German drug market (PRISCUS-list) which lists 83 inappropriate agents and their recommended surrogates. This study calculates the amount of drug reimbursement of PIM and the potential saving using appropriate surrogates recommended by the PRISCUS list from the perspective of statutory health insurance (SHI). METHODS Data was provided by AOK Research Institute (WIdO). Study material consists of a register extraction of the top 30 drugs (by sales) on PRISCUS-list in 2009 for patients ≥65 years of the entire SHI-population. We calculated the percentage of sales and defined daily doses (DDD) for patients ≥65 compared to the total SHI-population. Costs for the recommended substitution were estimated by different scenarios. RESULTS In 2009, the proportion of the top 30 drugs on the PRISCUS-list that were prescribed to patients ≥65 was 58.2%. Sotalol was the drug with the largest proportion of DDD prescribed to patients ≥65 (92.9%). Drug reimbursement for the top 30 PIM medications prescribed to patients ≥65 were €305.7 million (54.3% of total reimbursement). Reimbursement for Solifenacin was highest with €32.5 million. Prescription of the surrogates would lead to increasing costs for the German health care system. Those were calculated to range between €325.9 million and €810.0 million. CONCLUSIONS This is the first study assessing the economic burden of PIM according to PRISCUS-list in Germany. The results show that a more appropriate medication for the elderly comes along with additional costs. For a final evaluation of relevance and economics of PIM, costs of adverse drug events caused by PIM and clinical feasibility of substitution have to be taken into consideration.