OBJECTIVES: Sleep apnea (SA) is relatively common, occurring in about 2–4% of the general population. This study investigated the effects of PAP therapy on morbidity (including comorbid disease), all-cause mortality, and costs in patients with SA. A statutory health insurance (SHI) perspective was taken. METHODS: A total of approx. 4 million individuals covered by the SHI database were analysed (ca. 5% of the German SHI population). PAP therapy was initiated in 4068 patients with SA. Propensity score was used to define a control group of 4068 SA patients matched for age, sex, risk factors/etiology, region and medication who received usual care (no PAP). Patients were followed after therapy initiation over three years. RESULTS: During the first two years’ follow-up, hospital admissions were significantly lower in controls (p<0.0001 vs PAP for both years); number of admissions was 5,323 in the control group and 6,931 in the PAP group. Conversely, in year 3 of follow-up, the number of inpatient treatments was significantly lower in the PAP vs control group (1,525 vs 2,000; p<0.0001). Total cost of illness was higher in the PAP group compared with controls (year 1: €6,704 vs €5,015 [p<0.0001]; year 2: €5,272 vs €4,901 [p<0.001]; year 3: €5,091 vs €4,830 [p<0.001]). Recipients of PAP therapy had a significantly lower 3-year mortality rate compared with controls (4.5% vs 7.2%; p<0.0001; relative risk reduction 37.5%). CONCLUSIONS: SA patients with PAP therapy showed a significantly reduced mortality and morbidity. Also, the data showed that treatment may begin to have beneficial effects on the hospitalisation rate after 2 years of treatment. Costs of PAP remained higher than control over the first 3 years of therapy, although the difference between treatment groups reduced over time. A follow-up period of ≥5 years may be required to show beneficial economic outcomes in SA patients receiving PAP therapy.