OBJECTIVE: To determine health care resource utilization and costs over five years among Veterans Administration (VA) patients with cancer of the sigmoid colon. METHODS: This retrospective study was limited to veteran patients in New Mexico diagnosed between 1995 and 2000. Demographic information and data for outpatient medications, imaging, chemotherapy, hospitalizations, number of clinic visits, and number of physician visits were collected using VA databases. Costs applied for all services other than outpatient medications and chemotherapy were based upon 2001 Medicaid reimbursement values. Drug costs were based upon 2001 VA prices. RESULTS: There were 46 total patients (45 male) identified and data for years 2-5 was available for 35, 21, 19, and 11 patients respectively. The mean age was 72 years (+/- 7.78), with a range of 49-87. Twenty-two (48%) patients were in Stage 3 or 4, with lymph node involvement and/or metastases, at first diagnosis. The mean resource utilization per patient was greatest in year 1 ($8,269 ± 7,434), followed by year 2 ($2,792 ± 4,935), then year 5 ($1,496 ±2,759). The top three cost drivers for years 1 through 3 were hospitalization, chemotherapy, and clinic visits versus hospitalization, imaging, and clinic visits for years 4 and 5. The mean costs for treating Stage 3 or 4 patients were significantly higher (p<0.05) for years 1 and 5, year 1: ($10,959 +/- 9,481 versus $5,867 +/-3,641) and year 5: ($6,117 +/- 4,688 versus $470 +/- 495). CONCLUSION: This initial economic analysis helps identify costs and costs drivers in the treatment of cancer of the sigmoid colon. The study can serve as a model for data collection processes in the VA regarding direct medical costs of cancer of the sigmoid colon. With additional data, pharmacoeconomic modeling research regarding prevention strategies and/or screening methods could be performed.