OBJECTIVES: Research indicates that waste and inefficiency consumes 10% to 30% of health care spending, but exactly what health care interventions are contributing the most to this misallocation is poorly understood.  Some “low-value” interventions that offer relatively low or no additional health benefits for their costs have been identified in comparative effectiveness and cost-effectiveness literature.  Our study aims to quantify the healthcare resources and expenditures spent on low-value interventions in Massachusetts (MA) in an effort to better understand and allocate healthcare spending.  For this abstract we present results for the use of arthroscopic surgery for knee osteoarthritis. METHODS: We identified a list of low-value services based on published literature, which included arthroscopic debridement/chondroplasty for knee osteoarthritis (procedure codes: 29877, 29879, and G0289).  We used the 2012 MA All Payer Claims Database (APCD) to examine the proportion and characteristics of the individuals who received these services, and to calculate the state’s associated annual healthcare expenditure. The APCD included medical and pharmacy claims from all commercial payers and certain public programs (Medicare Part C only and Medicaid), including patient out-of-pocket payments. RESULTS: From our study population (N=6,549,289), a total of 8,488 individuals were identified as receiving arthroscopic knee surgery in 2012.  Of these patients 52.5% were aged <50 years, and 52% were female.  Total state healthcare spending associated with this procedure in 2012 was $8.7 million, 95% of which were spent by private payers.  Most (64%) of the resources were utilized in the outpatient setting, followed by other sites of service (non-inpatient and non-outpatient, such as swing-bed and ambulatory surgical center) (27%). CONCLUSIONS: Quantifying the resources spent on low value interventions can help decision makers gain insight on the potential healthcare savings that could be accrued if healthcare resources were reallocated away from these interventions.