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Bariatric surgery is being performed in increasing numbers in an era when reimbursements are being reduced. Academic health centers bear the responsibility for training surgeons to perform these operations yet must keep costs to a minimum and retain high quality. The UCLA Bariatric Surgery Program developed a clinical pathway for the pre- and postoperative management for gastric bypass patients to achieve these goals. Medical records for 182 consecutive gastric bypass patients were retrospectively reviewed before implementation of the pathway (Group I) during the fiscal year of 1998/1999. Data on average length of stay, average intensive care unit length of stay, average standard variable cost, percentage readmission rate, and percentage return to the operating room were collected. This information was compared with the data collected prospectively from 182 patients after implementation of the pathway in July of 1999 (Group II) during the fiscal year of 1999/2000. Hospital cost per admission was reduced by 40 per cent in Group II compared with Group I (P < 0.02). The average length of stay was reduced from 4.05 days in Group I to 3.17 days in Group II (P < 0.033). Overall readmission rate was decreased from 4.2 per cent in Group I to 3.2 per cent in Group II (P < 0.05). There were no differences in morbidities between both groups. The pathway reduced costs by reducing the hospital length of stay, intensive care unit utilization, and readmission rates. Quality was maintained as evidenced by a similar pattern of postoperative morbidities yet readmission rates were reduced. Our results indicate that implementation of a clinical pathway for bariatric surgery reduces cost and improves quality of care in an academic institution. [ABSTRACT FROM AUTHOR]