Abstract Hypnotics (sleeping pills) are prescribed widely, but the economic costs of the harm they have caused have been largely unrecognized. Randomized clinical trials have observed that hypnotics increase the incidence of infections. Likewise, hypnotics increase the incidence of major depression and cause emergency admissions for overdoses and deaths. Epidemiologically, hypnotic use is associated with cancer, falls, automobile accidents, and markedly increased overall mortality. This article considers the costs to hospitals and healthcare payers of hypnotic-induced infections and other severe consequences of hypnotic use. These are a probable cause of excessive hospital admissions, prolonged lengths of stay at increased costs, and increased readmissions. Accurate information is scanty, for in-hospital hypnotic benefits and risks have scarcely been studied — certainly not the economic costs of inpatient adverse effects. Healthcare costs of outpatient adverse effects likewise need evaluation. In one example, use of hypnotics among depressed patients was strongly associated with higher healthcare costs and more short-term disability. A best estimate is that U.S. costs of hypnotic harms to healthcare systems are on the order of $55 billion, but conceivably might be as low as $10 billion or as high as $100 billion. More research is needed to more accurately assess unnecessary and excessive hypnotics costs to providers and insurers, as well as financial and health damages to the patients themselves.