OBJECTIVES: To evaluate the association of allergic rhinitis (AR) with asthma exacerbations and healthcare costs of asthma patients. METHODS: Newly diagnosed patients 12-64 years of age with ≥2 asthma diagnoses, or 1 diagnosis and ≥1 asthma-related prescription claim, during the period 1/1/2008-3/31/2011, continuously eligible for 12 months before and 24 months after index asthma diagnosis were identified from a privately-insured claims database (N~14,000,000). The index date was defined as the date one year after the index asthma diagnosis, baseline period as 12 months before, and study period as 12 months after the index date. Two cohorts were selected from the sample: asthma-only (without any AR diagnosis); and asthma+AR (with ≥1 AR diagnosis and ≥1 intranasal corticosteroid claim during baseline). Descriptive analyses compared demographic characteristics, co-morbidities, healthcare costs (medical service and prescription drug costs) inflated to 2010 dollars, and asthma exacerbations (defined as either an inpatient or emergency department visit with asthma diagnosis or use of oral corticosteroid). Multivariate analyses adjusting for baseline differences were used to estimate risk-adjusted asthma exacerbations and costs. RESULTS: Asthma+AR patients(n=3,716) had similar mean age and gender distribution but higher proportions of  comorbidities(e.g., sinusitis, sleep apnea) compared with asthma-only patients(n=8,547). During the study period, asthma+AR patients had significantly higher proportion of asthma exacerbations(29.5% vs. 20.6%, p<.0001), possibly due to higher oral corticosteroid use(27.8% vs. 18.5%, p<.0001), and higher mean number of asthma-related outpatient/other visits(7.1 vs. 3.4, p<.0001). Asthma+AR patients had significantly higher healthcare costs($6,833 vs. $6,137, p<.0001), due to higher drug costs($2,136 vs. $1,396, p<.0001), higher asthma-related costs($744 vs. $439, p<.0001), and higher asthma-related drug costs($492 vs. $250, p<.0001), than asthma-only patients. Risk-adjusted asthma exacerbations and costs were also higher for asthma+AR patients. CONCLUSIONS: In this analysis, patients with asthma+AR had significantly higher proportion of asthma-related exacerbations and higher healthcare costs compared with asthma-only patients.