A retrospective review of 114 patient charts was conducted at three geographically different hospitals to compare the costs of ceftazidime (CTZ) with the combination of tobramycin and ticarcillin (T/T) in the treatment of hospital-acquired pneumonias and/or septicemias. Variables analyzed to determine the cost of the therapy included duration of treatment, dosage and number of doses administered, side effects, and laboratory tests. Time and motion studies were also performed and the results included in the algorithm. In two of the three hospitals, the computer-calculated cost of CTZ therapy was significantly less than for T/T therapy ($1194 vs. $1668 and $93 vs $629). In the third hospital there was no significant difference in the costs of the two treatments ($1079 for CTZ vs. $1066 for T/T). The cost of each regimen per patient day followed a similar pattern, with CTZ therapy being significantly less expensive in the same two hospitals. Patients receiving CTZ therapy realized an average cost savings of $29.70 per day at the three institutions. These savings appeared to be due to a reduction in laboratory and administration costs resulting from the decreased frequency of CTZ administration. We conclude that CTZ therapy was less costly than T/T therapy at three geographically different institutions when the cost of supplies, laboratory tests, and personnel time were taken into account.