ABSTRACTPurposeTotal neoadjuvant therapy (TNT) has become the standard of care in locally advanced rectal cancer, but its economic impact is unclear. This study compares the cost of TNT with conventional neoadjuvant therapy (CNT), consisting of either short‐course radiotherapy or long‐course chemoradiotherapy, within a universally funded public healthcare system.MethodologyA trial‐based costing analysis was conducted from a third‐party payer's perspective with a 2‐year time horizon, following CHEERS guidelines. Consecutive patients with rectal cancer treated with neoadjuvant therapy from 2014 to 2023 were extracted from a multi‐institutional database. Inpatient, outpatient, imaging and pathology resource costs were extracted and adjusted to 2024 AUD with a 5% discount rate. Primary outcomes were overall cost per cohort and mean per patient cost. Secondary outcomes were overall and mean cost per cost category. Sensitivity analysis explored the influence of discount rates and inflation methods.ResultsOf 115 eligible patients, 60 (52.2%) received CNT and 55 (47.8%) received TNT. Overall treatment costs for the cohorts were $8 429 710.66 (CNT) and $6 992 616.67 (TNT), with mean per patient costs of $140 495.18 (CNT) and $127 138.48 (TNT). Overall per patient costs were $13 356.70 (9.51%) lower for TNT patients, mainly driven by lower mean inpatient costs ($78 523.53 vs. $96 843.08, 18.9%). TNT increased outpatient ($43 001.18 vs. $39 376.12, 9.21%), imaging ($4179.13 vs. $2973.61, 40.5%) and pathology ($1434.65 vs. $1302.38, 10.1%) costs. The results were robust to sensitivity analysis.ConclusionTNT is less costly than CNT within a universally funded public healthcare system, primarily due to reduced inpatient costs associated with higher rates of organ preservation.