Aim: To estimate the health economic impact of undertaking urine albumin-to-creatinine ratio (UACR) testing versus no UACR testing in early stages of chronic kidney disease (CKD) progression in patients with type 2 diabetes (T2D). Methods: An economic model, taking a UK healthcare system perspective, estimated the impact of UACR testing on additional costs, clinical benefits measured as prevented dialyses and cardiovascular-related deaths, life years gained (LYg), LYg before kidney failure, and incremental cost-effectiveness ratio (ICER). Sixteen of the 18 Kidney Disease: Improving Global Outcomes (KDIGO) heatmap categories were considered separately, and grouped in health states according to CKD risk. Results were derived for current standard-of-care and emerging CKD therapies. Results: The cohort that adhered to both UACR and estimated glomerular filtration rate (eGFR) testing guidelines in early stages of CKD (n = 1000) was associated with approximately 500 LYg before kidney failure onset; costing approximately £2.5 M. ICERs across the KDIGO heatmap categories were approximately £5,000. Limitations: This model used data from a comprehensive meta-analysis that was initiated more than 10 years ago (2009). While this was the most comprehensive source identified, recent changes in the treatment landscape, patient population and social determinants of CKD will not be captured. Furthermore, a narrow approach was taken, aligning included costs with UK NHS reference materials. This means that some direct and indirect drivers of costs in late-stage disease have been excluded. Conclusions: UACR testing in the early stages of CKD is cost effective in T2D patients. Emerging therapies with the potential to slow CKD progression, mean that optimal monitoring through UACR/eGFR testing will become increasingly important for accurate identification and timely treatment initiation, particularly for the highest-risk A3 category.