Context: Prior clinical studies have indicated that cochlear implantation provides benefits to individuals with advanced sensorineural hearing loss who are unable to gain effective speech recognition with hearing aids. Objective: To determine the cost per quality-adjusted life-year (QALY) for adults receiving multichannel cochlear implants. Design: Prospective 12-month multicenter study using preference-based quality-of-life measures and total cost determinations, comparing profoundly hearing-impaired adult subjects with and without cochlear implants. Setting: Hospital-based and patient-resource clinics. Patients: Severely to profoundly hearing-impaired adult recipients of a cochlear implant and adults eligible for the device who had not yet received it. Main Outcome Measure: Clinical assessment of implant participants included medical and audiologic (speech understanding) data at the time of enrollment, 6 months, and 12 months. All participants' health-utility was assessed at the rime of enrollment, 6 months, and 12 months using the Health Utility Index. One-year-medical resource utilization and cost data included bills related to implants, patient diaries, charge estimates from clinical sites, and published literature. A decision model was developed to determine cost per QALY. Results: Of the 84 enrolled adults, 62 (75%) completed the study. Mean health-utility scores at the time of enrollment were identical between groups. The marginal 12-month health-utility gain for implant recipients was 0.20; 90% of this improvement was achieved within 6 months. For patients with a mean ZZ-year life expectancy, the marginal cost per QALY was $14 670; Conclusions: Overall, multichannel cochlear implants significantly improved recipients' performance on measures of speech understanding and ratings of health-utility within 6 months of implantation. The multichannel cochlear implant yielded a very favorable cost per QALY.