OBJECTIVES: To aid in the understanding of cost effective wound healing technology advances, KCI, Inc. collaborated with Milliman to produce a cost model vacuum assisted closure therapy (V.A.C. Therapy) for four wound types. METHODS: Hospital costs associated with specific wound types (Diabetic Ulcers, Diabetic Amputations, Orthopedic Trauma and Complicated Sternotomies were obtained from medical administrative claims databases. These figures were used as the basis for costs attributed to patients requiring wound care treatment. The interactive model allows selection of a given hospital, their contracted price of V.A.C. Therapy, and their expected number of wounds treated during a year period. Potential cost savings scenarios were obtained by modeling the clinical paths of treatment for these four wound types and associating the expected costs for alternative treatments. Potential cost savings calculations were produced for each of the four wound types. RESULTS: V.A.C. Therapy results in lower cost to the hospital compared to standard wound treatment. The differences range from 9% for Diabetic Ulcers to 23% for Complicated Sternotomies, including the cost of the V.A.C. Therapy. Potential savings are obtained primarily from shorter hospital stays due to increased efficiency in meeting discharge criteria. Other sources of potential savings based on this hospital model include fewer complications and greater wound healing success, resulting in fewer repeat treatments. CONCLUSIONS: This interactive model is a useful tool for exploring the potential value of advancing wound care treatment options and provides information on the expected costs of treating patients with four specific wound types.