OBJECTIVES: Prescribing potentially inappropriate medications (PIMs) as first-line treatment for older adults has been a major safety concern as PIMs use have been associated with negative health outcomes. Our primary objective was to determine the prevalence of PIMs among U.S. older adults. The secondary objective was to estimate the total and different types of healthcare expenditures associated with PIMs use. METHODS: A retrospective cohort study with patients over age 65 was conducted using Medical Expenditures Panel Survey (MEPS) data for the years 2012 (N = 112,154) and 2013 (N= 110,072). The prevalence for each year was evaluated using the updated 2015 Beer’s criteria. As MEPS doesn’t have sufficient details on daily drug dosage, frequency, and duration of administration, our analysis included only 21 out of the 38 listed drugs in the diagnosis-independent criteria. All our analyses accounted for the complex sampling design. RESULTS: The prevalence of PIMs among US older adults was 5.5% for 2012 and 4.6% for 2013. Amongst all the drug classes, PIMs prevalence was highest for the class of CNS-active drugs users (1.3% for 2012, 1% for 2013). PIMs use was found to be highest among 65-74 followed by 75-84 and 85+ age group. The average annual total healthcare expenditure per PIMs user was $12,969 (95% CI: 11113, 14825) in 2012 and $14,536 (95% CI: 12254, 16818) in 2013. Amongst types of expenditures, prescription, inpatient, and outpatient visits accounted for almost 80% of the total expenditures, while emergency and other expenditures were less than 20% for both years. CONCLUSIONS:  This study found the prevalence for PIMs users among community dwelling older adults using most updated beers criteria and for the recent years. Using this criteria, we found that prevalence decreased by almost 1% for the year 2013 in comparison to the previous year.