The problem of estimating expected outcomes for the economic evaluation of treatments for which the outcome of principal interest is (quality adjusted) survival time has so far not received sufficient attention in the literature. The best estimate of expected survival is mean survival time, but with censored survival data, the true survival time for all the subjects is not known, so the mean is not defined.A possible solution to this estimation problem is illustrated by a retrospective cost-effectiveness analysis of the addition of hormonal therapy to standard radiotherapy for patients with locally advanced prostate cancer. A recently proposed method is used to approach the problem caused by censored cost data, and the impact of uncertainty is assessed by bootstrap resampling techniques. Mean survival time is estimated by a restricted means analysis with the time point of restriction determined by statistical criteria. When average total costs and mean survival time is evaluated at this time point of restriction, the result is that the combined therapy (radiotherapy plus hormonal therapy) increases mean survival time by about 1 year, while reducing the costs per patient for the French health insurance system by 12 700 FF. The time point of restriction may also be determined by other criteria and mean survival time may be estimated by extrapolating the survival curves by means of various parametric survival distributions. We show that the exact results of the economic evaluation are decisively determined by the restriction time point chosen and the approach taken to estimate mean survival time. Copyright 2002 John Wiley & Sons, Ltd.