OBJECTIVES: Recent trials demonstrate that everolimus (EVR) in combination with reduced tacrolimus (rTAC) significantly improves renal function compared to tacrolimus (TAC) alone in liver transplant recipients. This study aims to conduct a cost-effectiveness analysis of EVR + rTAC for liver transplant recipients. METHODS: A Markov model was developed to estimate the costs and quality-adjusted life years (QALYs) for liver transplant recipients who receive EVR + rTAC compared to those who receive TAC alone. We adopted the perspective of the US health care system, including direct costs only. A lifetime horizon was chosen. We derived parameter estimates from clinical studies and published sources. Deterministic and probabilistic sensitivity analyses were conducted to account for uncertainties of key model parameters. RESULTS: Compared to the combination therapy (EVR + rTAC), monotherapy (TAC) resulted in lower lifetime accumulated costs ($390,900 and $874,400) and higher accumulated effectiveness (11.71 QALYs and 11.60 QALYs, respectively). Sensitivity analyses suggested that the main drivers of our model included the probability of dialysis after end stage renal disease and rates of transitions between different chronic kidney disease stages. Varying these parameters yielded an incremental cost-effectiveness ratio (ICER) ranging from $176,200 to $2,687,600 per QALY gained indicating TAC was still considered cost-effective given a willingness-to-pay threshold conventionally accepted. CONCLUSIONS: The combination therapy (EVR + rTAC) is not likely to be cost-effective for liver transplant recipients primarily because of substantial cost differences between EVR and TAC. Future research is warranted to investigate the cost-effectiveness of the combination therapy after generic EVR becomes available.