Abstract Introduction Misinformation is a major public health threat as it leads to unnecessary illnesses, deaths, and costs to society. In 2021, misinformation about COVID-19 vaccines was rampant, where a large portion of the US population believed in vaccine misinformation and refused vaccination.Methods This study utilized a microsimulation model of COVID-19 vaccination, cases, hospitalizations, and deaths to estimate the cost of vaccine hesitancy that was fueled by misinformation in the United States. The analysis compares a baseline model with scenarios where misinformation was removed.Results Misinformation was estimated to contribute to nearly 2.3 (2.04–2.5) million cases and 66 000 (59 300–72 500) hospitalizations in 2021. Misinformation resulted in $2 billion ($1.79–$2.33 billion) in extra costs of hospitalization and 45 000 (40 800–50 000) avertable deaths. Misinformation on vaccine hesitancy cost up to $229 million ($226–$231 million) in California, $173 million ($171–$175 million) in Texas, $171 million ($169–$173 million) in Florida, and $144 million ($143–$146 million) in New York State in 2021. Montana, Nevada, Colorado, Arizona, Wyoming, New Mexico, and Alaska faced the highest ($10–$14) per person costs of misinformation.Conclusion While the COVID-19 pandemic has subsided, misinformation remains. Combating misinformation on a large scale and building trust in health institutions and science is essential to prevent unnecessary costs and improve population health.