BACKGROUND: While treatment with 5-fluorouracil (5-FU) plus leucovorin has been shown to prolong survival in patients with metastatic colorectal cancer, it also can cause significant toxicity, sometimes necessitating hospitalization. The incidence and costs of these admissions have not been fully documented. OBJECTIVE: To estimate the incidence and cost of hospitalizations for toxicities associated with 5-FU therapy in patients with metastatic colorectal cancer. METHODS: Using the 1994 Medicare 5% sample, we identified all patients with metastatic colorectal cancer who underwent colorectal surgery. We stratified these selected subjects into those who received 5-FU therapy within 90 days of their surgery ("5-FU group") and those who did not receive any chemotherapy ("no-chemotherapy group"); patients receiving chemotherapeutic agents other than 5-FU were dropped from the sample. Using techniques of survival analysis, we then compared the incidence and cost of all hospital admissions with listed ICD-9-CM diagnosis codes (principal or secondary) for conditions that may be related to 5-FU toxicity (e.g., volume depletion, stomatitis, nausea and vomiting). RESULTS: A total of 441 patients met all study entry criteria, including 192 who received 5-FU and 249 who did not receive chemotherapy following surgery. 5-FU patients were significantly younger than those in the no-chemotherapy group (p<.001). Mean (±SD) follow-up time was slightly longer in the 5-FU group (137±96 days vs 117±88 days for no chemotherapy). The incidence at 10.5 months of toxicity-related hospitalizations (principally volume depletion, agranulocytosis, gastroenteritis, and nausea and vomiting) was 31% among patients who received 5-FU and 8% among those who did not receive chemotherapy. The cost of inpatient care was $2,716 higher among 5-FU patients. CONCLUSIONS: Hospitalization for 5-FU toxicity is frequent and costly among Medicare patients with metastatic colorectal cancer.