OBJECTIVE: Clinical trials have demonstrated moderate therapeutic efficacy for orlistat and sibutramine, with patients losing between 5-10% of initial body weight. Due to the cost of orlistat and sibutramine and moderate efficacy, Kansas Medicaid chose to use prior authorization to control expenditures on anti-obesity agents. The objective of this study was to determine if differences exist in cost and effect between patients who received PA approval for anti-obesity therapy and those who did not. METHODS: A retrospective, cohort study was designed in which patients were divided into those that received PA approval for sibutramine or orlistat and those that did not. The payer perspective was used in this study. Cost data included the total direct costs incurred by the Medicaid program including medications, physician office visits, hospital admissions, and administrative costs of the PA program. Effectiveness therapy was measured by the probability of patients achieving greater than 5% loss of initial weight. Independent sample t-tests were used to determine if differences exist between mean costs and effectiveness between the alternatives. RESULTS: Patients who received PA approval for orlistat/sibutramine incurred $16730 ± $20185 in average total costs over the study time period compared to $12527 ± $18,702 for patients who did not (p = 0.02). Average initial weights and BMIs for patients who received drug therapy were 286 pounds and 43.4 kg/m2 respectively, while patients who didn't had average initial weights of 255 pounds and BMI of 38.9 kg/m2. Patients who received anti-obesity therapy met the effectiveness goal 33% of the time, compared to 5% of the time for a patient who didn't (p <0.001). CONCLUSION: The average cost per Medicaid beneficiary was $4203 higher for those patients who received prior authorization approval for anti-obesity therapy compared to those who did not. However, patients also had a significantly higher probability of losing weight.