OBJECTIVES: In Mexico, breast cancer is the second most frequent cancer in oncology patients so high quality health care services and an efficient resource use is a priority. This study assesses to identify improvement health care areas for patients with breast cancer and estimates its economic impact in the Social Security Mexican Institute. METHODS: A study was performed for breast cancer patient's health care process in the biggest oncology hospital of Mexico City throughout 2003, to identify patient's clinical phases, resource use and timing for services. With the aid of oncologist experts, treatment maps were constructed for each clinical phase. Hospital records were used to calculate the number of patients treated in each phase and with the support of structured questionnaires, efficient levels of oncology services were identified. The study estimated clinical improvements and potential financial savings. The estimates were conducted from the health care payer's perspective. All costs were expressed in 2005 US$. RESULTS: One hundred four women with breast cancer were recruited; 36.4% of patients were in phases III and IV, and inefficiencies were observed in the hospital central services. Extrapolating the sample results to the overall breast cancer population in the Social Security Mexican Institute (n=3375); annual direct expected medical costs were US$73.8 million. Improving early detection up to 89% of women in phases I and II; and sending these women directly to third level oncology services will improve process efficiency and financial savings could reach US$10.5 millions (14.2% of total breast cancer expenditures). Also, reductions on the timing cycle for health care services to 150 days and improvements on the survival length in 16% would give the Mexican Health System similar savings. CONCLUSIONS: Improving early detection/quality health care services would obtain important clinical benefits for breast cancer patients and significant savings for Mexican health institutions.