Regulations in Ontario, Canada, as in most provinces and states in North America, require human tissues (with few exceptions) removed at surgery to be sent to a pathology laboratory for examination and report. We hypothesized that this practice is inconsistently followed and that routine pathological consultation is costly and rarely results in a change in treatment for patients undergoing knee arthroscopy. Chiefs of pathology, orthopaedic surgeons, and orthopaedic operating room nurse managers in Ontario hospitals that perform arthroscopic knee surgery were surveyed for compliance. We determined cost using pathology department procedure codes and evaluated effectiveness as the correlation between the postoperative diagnoses of orthopaedic surgeons and pathologists for 1,036 consecutive knee arthroscopy cases. In only one case (0.1%) was it felt that pathology consultation had the potential to significantly alter patient care. The total cost of pathology consultation for the 1,036 cases reviewed was $234,147.00 (mean cost per case, $226.00). Ninety percent of hospitals do not comply with the regulations regarding the processing of these tissues. Poor compliance is justified by the lack of diagnostic value and the need to contain health care costs.