OBJECTIVES: In the province of Styria, Austria, a structured patient education program for patients with type-2 diabetes was established in the year 2000. In this open label, prospective cohort study (n=1150) follow-up data after one year have been analysed to document the potential effects over 10 years using the CORE-Diabetes Model, a validated, peer reviewed simulation model. Patients outcomes and total costs were calculated. METHODS: A Styria-wide patient education program for type-2 diabetes was established for general practitioners to improve treatment outcomes in diabetes care. The program is funded by the public health care system and a standardised documentation at baseline and after one year was used. Intermediate results after one year were incorporated in the CORE diabetes model and linked with Austria specific cost data. Monte-Carlo-Simulation (n=5.000) over ten years projected long term effects of single patient education. A virtual control group was assumed to be treated like general Styrian diabetic population. Discount rate was 5 % annually. RESULTS: The average life expectancy increased by 0.29 years (7.32 ±3.48 vs. 7.03±3.5) under education, the total costs over ten years decreased by 774€ per patient (20,496€ ±30,335€ vs. 21,270€ ±37,917€) or 3.8%. Patient education leads to improved foot care and retinal screening as well as renal therapy but to higher general treatment costs (educated: 4,364€; not educated: 2,795€). Total number of long term events prevented for 5.000 patients was 1.810. Results were most sensitive to improvements in screening rates and the costs of implementing the program. CONCLUSIONS: Patient education reduced late complications and therefore is able to compensate for higher management and treatment costs. Results of model-based projections demonstrated that the program may be cost-saving over ten years in an Austrian cost setting.