This article describes a model that estimates annual patient health and cos
t outcomes for schizophrenia under alternative treatment scenarios. We esti
mate these outcomes for typical antipsychotics and show how treatment with
atypical antipsychotics could have an impact on these outcomes. Patients ar
e divided into 5 subcategories-newly diagnosed, no episode, acute episode(s
), extended care, and institutionalized-and patient health and cost outcome
s are estimated for each category. The proportion of people in each categor
y is estimated for U.S. general, state mental hospital, and community menta
l health populations. Outcomes include extrapyramidal and moderate/severe s
chizophrenia symptom days, employed days, suicides, hospital days, and heal
th costs. For patients treated with typical antipsychotics, annual per-pati
ent symptom days ranged from 55 to 365 and costs ranged from $16,000 to $57
,000, depending on disease severity. Atypical antipsychotics may reduce sym
ptoms and costs through better efficacy for negative symptoms and better co
mpliance.