Detailed analysis of all neurologic and neurosurgical admissions at Johns Hopkins Hospital for 6 months prior to and the second 6 months after installation of a CT head scanner was undertaken in an attempt to identify the effect CT had on health care decisions, costs, and morbidity. Data showed decreased cost of more than $2,000 per patient and shorter length of stay by 7 days in patients with extracerebral collections, and more than $2,500 and 8 days reduction in patients with tumors after CT was in use. A group matched by computer for age, diagnosis, and physician showed decreased costs of more than $2,000 and shortened stay by more than 3 days per hospitalization. Increased costs were shown in patients with cerebrovascular disease after CT. Change in method of workup with fewer invasive studies for all patients (P < .001) and significant increases in cost of diagnostic workup were demonstrated (P < .001). There was no change in morbidity and mortality between the two groups.