Studies have shown that combination interferon+ribavirin is a cost-effective treatment for Hepatitis C from a societal perspective. Safety-net hospitals are currently faced with the prospect of paying for an expensive treatment for their many patients who are unable to pay. OBJECTIVES: Examine the cost-effectiveness of alternative treatment strategies for Hepatitis C as it affects the safety-net hospital. METHODS: A Markov decision analytic model was constructed, using a reference case of a 45 year-old male with Hepatitis C, but without cirrhosis. The perspective adopted was a safety-net hospital. Two populations were examined: uninsured, and insured, but without coverage for combination interferon+ribavirin. Two strategies were considered: (1) CMB/G - Combination therapy for 6 or 12 months depending on virus genotype, and (2) IFN/CMB, a cost saving strategy that begins with 12 months of interferon monotherapy, followed by 6 months of combination therapy for interferon relapsers. Data came from prior publications. RESULTS: In the uninsured group, CMB/G cost an additional $10,700 per patient, with an incremental cost-effectiveness ratio(ICER) of $9,600/QALY. Considering varying degrees of aggressive disease (i.e. progression to cirrhosis), the ICERs ranged from $6,000/QALY-$12,100/QALY. In the underinsured group, CMB/G was associated with an additional cost of $13,100 per patient, with an ICER of $11,700/QALY. For very aggressive disease, the ICER for CMB/G dropped to $6,900/QALY. For mild disease, the ICER for CMB/G rose to $15,100/QALY. CONCLUSIONS: Although ICERs would appear to be cost-effective from a societal perspective, this is less clear for hospitals. Cost-saving strategies, such as starting with interferon, and only giving combination therapy to relapsers may be a necessary option for the safety-net hospital struggling to find the funds to pay for treatment for their large, indigent population.