Study Design Cost data were gathered from computerized records of the Liberty Mutual Insurance Company for low back pain workers' compensation claims (N= 119,107) and for all claims (N= 731,087) initiated from 45 jurisdictions (states) during 1989. Objective This study provided more current, accurate, and additional information to estimate the costs and incidence associated with compensable low back pain compared with all compensation claims. Methods The first group of data included all compensable low back claims selected by specific codes: body part codes consisted of low back area, sacrum and coccyx, disc, and multiple trunk; injury codes consisted of strain, sprain, inflammation, rupture, hernia, fracture, and contusion. The second sample included all compensable claims, including both occupational injuries and illnesses. Results Low back pain cases represented 16% of all claims but 33% of all claims costs; 55.4% of the low back pain cases received medical payments only (i.e., did not receive indemnity payments for lost time). The mean cost per case for low back pain was $8321; median cost per case was $396. Medical costs represented 32.4% of the total costs; indemnity costs (i.e., payment for lost time) represented 65.8%. Conclusions Since indemnity costs represent the greatest percentage of workers' compensation expenditure, the primary goal of low back pain management should be the prevention or reduction of prolonged disability.