A simulation model was constructed to assess the relative costs and cost-effectiveness of different screening and vaccination strategies for dealing with hospital incidents of varicella exposure, compared with current policies, using data from published sources and a hospital survey. The mean number of incidents per hospital year was 3·9, and the mean annual cost of managing these incidents was £5170. Vaccination of all staff would reduce annual incidents to 2·2 at a net cost of £48900 per incident averted. Screening all staff for previous varicella, testing those who are uncertain or report no previous varicella, and vaccinating those who test negative for VZV antibodies, reduces annual incidents to 2·3 and gives net savings of £440 per incident averted. Sensitivity analyses do not greatly alter the ranking of the options. Some form of VZV vaccination strategy for health care workers may well prove a cost-effective use of health care resources.