OBJECTIVES:Economic evaluations, such as cost effectiveness analyses (CEA), of pharmaceuticals have historically focused on costs and consequences at the individual level. However, illness and individual-level health interventions affect both the individual and their family members. METHODS: While certain disciplines have assessed the cost of illness on multiple family members and the effects of medical interventions on family members, CEA has not routinely incorporated measures of effectiveness and costs with the family as the unit of analysis. Family-level CEA is consistent with recommendations that CEA should consider everyone affected by the intervention and count all significant health outcomes and costs that flow from it, regardless of who experiences the outcomes or costs. RESULTS: Drawing from methodologies recommended by the Panel on Cost Effectiveness in Health and Medicine, we explore conceptual and methodology issues related to estimating costs at the family level for use in family-level CEA. CONCLUSIONS: We address the challenges inherent in defining a family, the availability of health service data to link families, and methods for aggregating, evaluating, and comparing family-level costs.