This study investigated the relationships between antipsychotic drug use pa
tterns and direct costs for 3,321 Medi-Cal patients with schizophrenia. Ord
inary least-squares regression models were used to estimate the impact on c
osts of receiving antipsychotic drug treatment, delays in treatment, change
s in therapy, and continuous therapy. Average costs were $25,940 per year p
er patient. Having used an antipsychotic drug was correlated with lower psy
chiatric hospital costs ($2,846 less) but higher nursing home costs. Comple
ting one year of uninterrupted drug therapy was correlated with higher nurs
ing home costs. Delayed drug treatment and changes in therapy increased the
cost by $9,418 and $9,719, respectively.