Reduction of postoperative readmissions has been identified as an opportunity for containment of health care costs. To date, the effect of index hospitalization costs on subsequent readmissions, however, has not been examined. To identify the effect of index admission costs on readmission rates and to quantify any potential variation in costs and readmission attributable to the patient, procedure, and surgeon. Retrospective analysis of the medical records of 4114 patients who underwent a colorectal, pancreatic, or hepatic resection from January 1, 2009, to December 31, 2013, at a tertiary care hospital. Readmission was defined as a second hospitalization within 30 days of discharge from the index hospitalization. Final follow-up was completed on April 24, 2014, and data were analyzed from July 1 to August 1, 2015. Total inpatient costs of the index hospitalization and readmission rates. Among 4114 patients who met inclusion criteria (2122 women [51.6%] and 1992 men [48.4%]; median [interquartile range (IQR)] age, 59 [49-69] years), 1760 (42.8%) underwent colorectal resection; 1660 (40.4%), pancreatic resection; and 694 (16.9%), hepatic resection. Seven hundred seven patients were readmitted within 30 days (unadjusted readmission rate, 17.2%), including 328 patients (18.6%) for colorectal procedures, 309 patients (18.6%) for pancreatic procedures, and 70 patients (10.1%) for hepatic procedures (P < .001). The median cost of surgery during the index hospitalization was $24 992 and varied by procedure (colorectal, $22 186; pancreatic, $29 175; hepatic, $22 757; P < .001). The median index length of stay was 7 (IQR, 5-11) days and was higher among patients who were eventually readmitted (8 [IQR, 6-13] vs 7 [IQR, 5-11] days; P < .001). Readmitted patients had a higher incidence of perioperative morbidity during the index hospitalization (169 of 707 [23.9%] vs 662 of 3407 [19.4%]; P = .007). On adjusted analysis, an independent association with a higher risk for readmission was found for African American patients (odds ratio [OR], 1.45; 95% CI, 1.17-1.81), those undergoing pancreatic (OR, 1.99; 95% CI, 1.50-2.63) or colorectal (OR, 1.93; 95% CI, 1.46-2.55) resection, and patients with an observed-to-expected index length of stay of greater than 1 (OR, 1.26; 95% CI, 1.05-1.54) (P ≤ .001 for all). Total index hospitalization costs were higher among patients who were readmitted ($21 312 vs $24 321; P < .001). Further, among patients without a complication during the index hospitalization, total costs remained higher among patients who were eventually readmitted ($26 799 vs $22 462; P < .001). At the surgeon level, readmission rates varied among surgeons performing the same procedure (0%-33% among colorectal surgeons, 13%-38%% among pancreatic surgeons, and 8%-33% among hepatic surgeons; P < .001). Similarly, substantial variation in index hospitalization costs was also observed among surgeons performing the same procedure (coefficient of variation, 118.4% for colorectal, 89.0% for pancreatic, and 85.0% for hepatic). Thirty-day readmission rates among patients undergoing major abdominal surgery vary significantly. Higher index hospitalization costs did not translate into lower readmission rates.