OBJECTIVES: The purpose of this study was to assess the direct medical cost and indirect work-loss cost of bipolar disorder and the comorbidities associated with this disease. METHODS: The study sample was drawn from a de-identified administrative claims database of approximately 1.8 million beneficiaries from 1999 to 2002, which included medical, drug, and disability claims data. Patients between ages 18 and 65 years who had at least 2 bipolar diagnoses, or 1 bipolar diagnosis and 1 prescription for a mood stabilizer, were included in the bipolar sample (N = 3499). A 1:1 matching major depressive disorder (MDD) control sample, and a 1:1 matching nonbipolar/non-MDD control sample with matching patient characteristics (age, sex, employee status) were randomly selected. To assess excess annual cost and comorbidities, we compared bipolar patients with the matching samples. Cost analyses were conducted from an employer's perspective. All costs were adjusted to 2002 dollars using Consumer Price Indices. T-tests or chi-square tests were conducted to estimate statistical significance. RESULTS: The annual per patient medical cost of bipolar disorder was $7643; the annual employee indirect cost was $2247. Compared with a typical MDD patient, a bipolar patient experienced an incremental health care cost of $1726 (P <0.05), $741 (P <0.05) for drugs, $1237 (P <0.05) for mental health services, $40 (P <0.05) for emergency services, and $539 (P <0.10) for employee indirect work loss. Compared with nonbipolar/non-MDD patients, bipolar patients had a higher risk of substance abuse (relative risk [RR] =11.6, P <0.05), anxiety disorder (RR = 9.8, P <0.05), suicide/self-harm (RR = 26.0, P <0.05), and injury/accident (RR = 2.0, P <0.05). The corresponding RRs for comparisons with MDD patients were 6.4 (substance abuse), 9.9 (anxiety disorder), 8.0 (suicide and self-harm), and 1.7 (injury/accident). CONCLUSIONS: Bipolar disorder is a costly disease that is often associated with other mental conditions, accidents, and suicide or self-harm.