OBJECTIVES:  To identify the average treatment effect (ATE) and the treatment effect in the treated (ATET) of surgical management of complicated diverticulitis compared to medical treatment in terms of total expenditure. METHODS:  We designed a retrospective cohort study on the Kaiser Permanente Southern California Health Plan adults (18+ years) who had complicated diverticulitis (incident cases) during 01/01/2007 to 12/31/2011. Complicated diverticulitis was defined as presence of either of abscess, intestinal obstruction, pneumoperitoneum, fistula or peritonitis. We identified medical expenditures (2016 USD) associated with inpatient, emergency department and outpatient visits during the one year period after the diagnosis date for patients without surgery and one year after the surgery date for those who had a colon surgery within one month of the index diagnosis. Total expenditure was the summation of all expenditure categories. Using a potential outcomes framework and doubly robust inverse probability weighted regression adjustment model, we evaluated the ATE and ATET of surgical vs medical management of complicated diverticulitis. The covariates adjusted in the model included socio-demographics, insurance, and Elixhauser comorbidity. RESULTS:  We identified 1320 incident cases of whom 144 had a colon surgery within one month of their index date. The average adjusted total expenditure during follow-up was $36,706 (95% CI $ 32,678 to $40,734) for those with surgery while it was $15,760 ($14,806 to $16,714) in those who did not undergo a colon surgery. The ATE indicated $20,300 ($16,173 to $24,426) higher cost for surgical management of diverticulitis while ATET indicated $19,033 ($15,124 to $22,943) higher cost. CONCLUSIONS:  Under the strong ignorability assumption, we find little support for heterogeneity of treatment effects since ATE and ATET were nearly similar. For a randomly selected diverticulitis patient presenting with complication and treated with surgery, the expected total expenditure would be $20,300 higher in the first year after such surgery.