OBJECTIVES: To estimate the cost and health benefits of implementing a risk factor-based prevention strategy for early-onset neonatal group B streptococcal (GBS) disease, using baseline assumptions and costs from a health maintenance organization. With the risk factor-based strategy, intrapartum antibiotics (IPAs) would be provided to women with fever, prolonged rupture of membranes, or preterm labor. A second objective was to determine the impact of an increased length of stay for well term infants with mothers who received IPAs. METHODS: We used decision analysis to compare the costs and benefits of the prevention strategy with usual obstetric practice for a cohort of 100 000 women and their newborn infants. We derived baseline values from a previous study based on chart review and automated cost data from a health maintenance organization in Northern California. In sensitivity analyses, we varied baseline assumptions, including additional costs for observing well term infants who received IPAs. RESULTS: If adherence to guidelines were 100%, 17% of mothers would receive IPAs at a cost of $490,000; $1.6 million would be saved by preventing 66 GBS cases (64% reduction). The net savings would be $1.1 million and 61 life-years. The net cost is sensitive to the cost of caring for well infants who received IPAs. If each term infant of a mother who received IPAs had 1 more day of observation than other term infants, there would be a net cost of $8.1 million; the cost per GBS case prevented would be $120,000 and the cost per life-year saved would be $130,000. CONCLUSIONS: Implementation in a health maintenance organization of a risk factor-based strategy to prevent neonatal GBS disease can prevent substantial disease and be cost saving. However, if the length of hospital stay were extended among well term infants whose mothers received IPAs, the strategy would be relatively costly compared with other medical interventions.