OBJECTIVES: The advantages of improved adherence to immunosuppression include reduced morbidity, mortality, and health care costs. Our aim was to examine calcineurin inhibitor (CNI) adherence following kidney transplantation and the effect on hospital days and health care costs. METHODS: US claims data from 10 US health plans for de novo patients receiving kidney transplants between 1995 and 2005 were employed. Patients with = one post-transplant claim for cyclosporine modified (CsA) or tacrolimus (tac) were included. CNI adherence was defined as the medication possession ratio (MPR) or the number of therapy days supplied to the number of followup days during the year following the first CNI claim. Patients who switched to another CNI medication or were not continuously enrolled in the health plan were excluded. Zero-inflated negative binomial regression was used to examine the relationship between CNI adherence and hospital days. RESULTS: Of 821 enrolled patients, 51% were in the CsA and 49% in the tac cohorts. The groups were not different with regard to age, gender, income, level of comorbidity, or number of hospital days during the adherence measurement period. A total of 28% of the CsA group was 100% adherent (MPR = 1) compared to 21% in the tac group (p = 0.02). Holding patient characteristics and prior utilization constant, receiving CsA was associated with 15 (95% CI: 5, 40) fewer hospital days compared to tac. Also, increasing levels of adherence by one standard deviation reduced days spent in the hospital by 12 (95% CI: 9, 30). This difference in hospital days likely impacted total health care costs, which were significantly lower for CsA ($13,949) compared to tac ($20,896) during the same period (p = 0.009). CONCLUSION: Receiving cyclosporine modified following transplantation was associated with higher levels of adherence, fewer hospitalizations, and lower total healthcare costs.