Aims: More than 29 million people in the US have type 2 diabetes mellitus (T2DM), a chronic metabolic disorder characterized by a progressive deterioration of glucose control, which eventually requires insulin. Abnormally low levels of blood glucose, a feared side-effect of insulin treatment, may cause severe hypoglycemia (SHO), leading to emergency department (ED) admission, hospitalization, and long-term complications; these, in turn, drive up the costs of T2DM. This study’s objective was to estimate the prevalence and costs of SHO-related hospitalizations and their additional longer-term impacts on patients with T2DM using insulin.Methods: Using Truven MarketScan claims, we identified adult T2DM patients using basal and basal-bolus insulin regimens who were hospitalized for SHO (inpatient SHO patients) during 2010–2015. Two comparison groups were defined: those with outpatient SHO-related encounters only, including ED visits without hospitalization (outpatient SHO patients), and those with no SHO- or acute hyperglycemia-related events (comparison patients). Lengths of stay and SHO-related hospitalization costs were estimated, and propensity score and inverse probability weighting methods were used to adjust for baseline differences across the groups to evaluate longer-term impacts.Results: We identified 66,179 patients using basal and 81,876 patients using basal-bolus insulin, of which ∼1.1% (basal) to 3.2% (basal-bolus) experienced at least one SHO-related hospitalization. Among those who experienced SHO (i.e. those in the inpatient and outpatient SHO groups), 27% (basal) and 40% (basal-bolus) experienced at least one SHO-related hospitalization. One-third of basal and about one-quarter of basal-bolus patients were admitted directly to the hospital; the remainder were first assessed or treated in the ED. Inpatient SHO patients using basal insulin stayed in the hospital, including time in the ED, for 2.8 days and incurred $6896 in costs; patients using basal-bolus insulin stayed in the hospital for 2.6 days and incurred costs of $5802. Forty-to-fifty percent of inpatient SHO patients were hospitalized again for SHO. Inpatient SHO patients using basal insulin incurred significantly higher monthly costs after their initial SHO-related hospitalization than patients in the other two groups ($2935 vs $1819 and $1638), corresponding to 61% and 79% higher monthly costs; patients using basal-bolus insulin also incurred significantly higher monthly costs than patients in the other groups ($3606 vs $2731 and $2607), corresponding to 32% and 38% higher monthly costs.Limitations: These analyses excluded patients who did not seek ED or hospital care when faced with SHO; events may have been miscoded; and we were not able to account for clinical characteristics associated with SHO, such as insulin dose and duration of diabetes, or unmeasured confounders.Conclusions: The burden associated with SHO is not negligible. Nearly one in three patients using only basal insulin and one in four patients using basal-bolus regimens who experienced SHO were hospitalized at least once due to SHO. Not only did those patients incur the costs of their SHO hospitalization, but they also incurred at least $1,116 (62%) and $875 (70%) more per month than outpatient SHO or comparison patients. Reducing SHO events can help decrease the burden associated with SHO among patients with T2DM.