Regional variations in lumbar spinal fusion rates suggest a poor consensus on surgical indications. Therefore, complications, costs, and reoperation rates were compared for elderly patients undergoing surgery with or without spinal fusion. Subjects were Medicare recipients who underwent surgery in 1985, with 4 years of subsequent follow-up. There were 27,111 eligible patients, of whom 5.6% had fusions. Mean age was 72 years. Patients undergoing fusion had a complication rate 1.9 times greater than those who had surgery without fusion. The blood transfusion rate was 5.8 times greater, nursing home placement rate 2.2 times greater, and hospital charges 1.5 times higher (all P < 0.0005). Six-week mortality was 2.0 times greater for patients undergoing fusions (P = 0.025). Reoperation rates at 4 years were no lower for patients who had fusion surgery and results were similar in most diagnostic subgroups. Indications for fusion among older patients require better definition, preferably based on outcomes from prospective controlled studies.