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Objective: To evaluate a novel healthcare programme for the treatment of patients with hip and knee osteoarthritis in southern Germany in terms of clinical and health economic outcomes. The study is based on claims data from 2014 to 2017. Methods: We conducted a retrospective comparative cohort study of 9768 patients with hip and knee osteoarthritis, of whom 9231 were enrolled in a collaborative ambulatory orthopaedic care programme (intervention group), and 537 patients received usual orthopaedic care (control group). Key features of the programme are coordinated care, morbidity-adapted reimbursement and extended consultation times. Multivariable analysis was performed to determine effects on health utilisation outcomes. The economic analysis considered annual costs per patient from a healthcare payer perspective, stratified by healthcare service sector. Besides multivariable regression analyses, bootstrapping was used to estimate confidence intervals for predicted mean costs by group. Results: Musculoskeletal-disease-related hospitalisation was much less likely among intervention group patients than control group patients [odds ratio (OR): 0.079; 95% CI: 0.062–0.099]. The number of physiotherapy prescriptions per patient was significantly lower in the intervention group (RR: 0.814; 95% CI: 0.721–0.919), while the likelihood of participation in exercise programmes over one year was significantly higher (OR: 3.126; 95% CI: 1.604–6.094). Enrolment in the programme was associated with significantly higher ambulatory costs (€1048 vs. €925), but costs for inpatient care, including hospital stays, were significantly lower (€1003 vs. €1497 and €928 vs. €1300 respectively). Overall annual cost-savings were €195 per patient. Conclusions: Collaborative ambulatory orthopaedic care was associated with reduced hospitalisation in patients with hip and knee osteoarthritis. Health costs for programme participants were lower overall, despite higher costs for ambulatory care.