OBJECTIVE: The purpose of this study was to determine whether elective use of a health plan-sponsored health club membership had an impact on health care use and costs among older adults with diabetes. RESEARCH DESIGN AND METHODS: Administrative claims for 2,031 older adults with diabetes enrolled in a Medicare Advantage plan were obtained for this retrospective cohort study. Participants (n = 618) in the plan-sponsored health club benefit (Silver Sneakers [SS]) and control subjects (n = 1,413) matched on SS enrollment index date were enrolled in the plan for at least 1 year before the index date. Two-year health care use and costs of SS participants and control subjects were estimated in regressions adjusting for baseline differences. RESULTS: SS participants were more likely to be male, had a lower chronic disease burden, used more preventive services, and had a lower prevalence of arthritis (P <or= 05). SS participants had lower adjusted total health care costs than control subjects in the first year after enrollment (-$1,633 [95% CI -$2,620 to -$646], P = 0.001), and adjusted total costs in year 2 trended lower (-$1,230 [-$2,494 to $33], P = 0.06). Participants who made on average >or=2 SS visits/week in year 1 had lower total costs in year 2 ($2,141 [-$3,877 to -$405], P = 0.02) than participants who made <2 visits/week. CONCLUSIONS: Use of a health club benefit by older adults with diabetes was associated with slower growth in total health care costs over 2 years; greater use of the benefit was actually associated with declines in total costs.