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Introduction: The association between poor physical fitness and adverse health outcomes is well-established, but few data are available regarding the association between fitness and health care costs. Hypothesis: Higher fitness is associated with lower overall health care costs. Methods: We studied 1,294 patients (mean 64±12 years) who underwent maximal exercise testing for clinical reasons as part of the Veterans Exercise Testing Study (VETS). Fitness was expressed as the percentage of age-predicted peak METs achieved, and categorized in quartiles. Total and annualized health care costs, derived from the VA Allocated Resource Center, were assessed between 2005 and 2010. Health care costs between quartiles of fitness were compared using ANOVA; multiple regression was used to determine clinical and exercise test predictors of health care costs. Follow-up for all-cause mortality (mean 8.5±5 years) was performed through March 2013. Results: A gradient for reduced health care costs was observed with increased fitness, with subjects in the least-fit quartile having approximately twice the overall costs as those in the fittest quartile (Table). Non-survivors were significantly less fit (6.5±5.1 vs. 9.1±3.5 METs, p<0.001) and exhibited roughly 3 times the health care costs of those who survived. In a multivariate model including historical, clinical and exercise test responses, fitness was a significant predictor of health care costs (p<0.01). Conclusions: Low fitness is associated with a significant burden on the health care system. Improving fitness should be encouraged for its potential to lower health care costs.