For months, Sovereign Valentine had been feeling progressively run-down. The 50-year-old personal trainer, who goes by "Sov," tried changing his workout and diet to no avail.
Finally, one Sunday, he drove himself to the hospital in the small town of Plains, Mont., where his wife, Jessica, happened to be the physician on call. "I couldn't stop throwing up. I was just toxic."
It turned out he was in kidney failure and needed dialysis immediately.
"I was in shock, but I was so weak that I couldn't even worry," he said. "I just turned it over to God."
He was admitted to a nearby hospital that was equipped to stabilize his condition and to get his first dialysis session. A social worker there arranged for him to follow up with outpatient dialysis, three times a week. She told them Sov had two options, both about 70 miles from his home. They chose a Fresenius Kidney Care clinic in Missoula.
A few days after the treatments began, an insurance case manager called the Valentines warning them that since Fresenius was out of network, they could be required to pay whatever the insurer didn't cover. The manager added that there were no in-network dialysis clinics in Montana, according to Jessica's handwritten notes from the conversation. (The insurance company disputes this and says that its case manager told her there were no in-network dialysis clinics in Missoula.)
Jessica repeatedly asked both the dialysis clinic staff and the insurer how much they could expect to be charged, but couldn't get an answer.
Then the bills came.
Patient: Sovereign Valentine, 50, a personal trainer in Plains, Mont. He is insured by Allegiance through his wife's work as a doctor in a rural hospital.
Total bill: $540,841.90 for 14 weeks of dialysis care at an out-of-network Fresenius clinic. Valentine's insurer paid $16,241.73. The clinic billed Valentine for the unpaid balance of $524,600.17.
Service provider: Fresenius Medical Care, one of two companies (along with rival DaVita) that control about 70% of the U.S. dialysis market.
Medical treatment: Hemodialysis at an outpatient Fresenius clinic, three days a week for 14 weeks.
What gives: As the dominant providers of dialysis care in the U.S., Fresenius and DaVita together form what health economists call a "duopoly." They can demand extraordinary prices for the lifesaving treatment they dispense — especially when they are not in a patient's network. A 1973 law allows all patients with end-stage renal disease like Sov to join Medicare, even if they're younger than 65 — but only after a 90-day waiting period. During that time, patients are extremely vulnerable, medically and financially.
Fresenius billed the Valentines $524,600.17 — an amount that is more than the typical cost of a kidney transplant. It's also nearly twice Jessica's medical school debt. Fresenius charged the Valentines $13,867.74 per dialysis session, or about 59 times the $235 Medicare pays for a dialysis session.
When Jessica opened the first bill, she cried. "It was far worse than what I had imagined would be the worst-case scenario," she said.
Sov had a different reaction: "To me, it's so outrageous that I just have to laugh."
Dialysis centers justify high charges to commercially insured patients because they say they make little or no money on the rates paid for their Medicare patients, who — under the 1973 rule — make up the bulk of their clientele. But nearly $14,000 per session is extraordinary. Commercial payers usually pay about four times the Medicare rate, according to a recent study.
Dialysis companies are quite profitable. Fresenius reported more than $2 billion in profits in 2018, with the vast majority of its revenue coming from North America.
The discrepancy in payments between Medicare and commercial payers gives dialysis centers an incentive to treat as many privately insured patients as possible and to charge as much as they can before dialysis patients enroll in Medicare. It may also give dialysis centers an incentive to charge outlandish prices to the few out-of-network patients they see.
"The dialysis companies may think they can get closer to what they want from the health plans by staying out of network and charging these prices that are totally untethered to their actual costs," said Sabrina Corlette, a professor at Georgetown University's Health Policy Institute. "They have the health plans over a barrel."
One potential way to save costs on dialysis is to switch to a type that can be done at home, which involves infusing fluid into the abdomen. Called peritoneal dialysis, it is common in Europe but relatively rare in the U.S. In an executive order this month, President Trump announced new incentives to increase uptake of those options.
Brad Puffer, a spokesman for Fresenius Medical Care North America, said the company would not comment on any specific patient's situation.
"This is one example of the challenges that can arise from a complex healthcare system in which insurers are increasingly shifting the financial burden to patients," Puffer said in a written statement. "The insurance company should accurately advise patients of in- and out-of-network providers. It is the patient's choice when they receive that information as to which provider they select."
Resolution: As a physician, Jessica Valentine is savvy about navigating the insurance system. She knew it was important to find an in-network provider of dialysis. She and the insurance company case manager both searched on the insurer's online provider directory, she said, and were unable to find one. The problem may have been searching for a "provider" rather than a "facility" in the directory.
Jessica eventually wrote to the Montana insurance commissioner to inquire if the lack of a dialysis provider violated a requirement that insurers maintain an "adequate network" of providers.
With help from the state insurance commissioner, she learned that there was, in fact, an in-network dialysis clinic run by a nonprofit organization that had not turned up in her insurer's online search or the directory. She immediately arranged for Sov to start getting further dialysis there. But the bills with Fresenius, meanwhile, were adding up.
After a reporter made inquiries, a financial counselor at Fresenius told Jessica that the Valentines qualified for a discount of 50%, based on their income. That would still leave them a bill of $262,400.08.
"It's still a completely outrageous charge," Jessica said. "I want to pay what we owe and what's reasonable and what his care actually cost."
Unwilling to pay Fresenius more, Allegiance said Jessica should have found the in-network facility earlier. "There is always the potential for customers to misunderstand information about how their health plan works, especially in stressful situations," a spokesperson for Allegiance wrote.
Jessica is considering contacting a lawyer. If all else fails, the Valentines will consider filing for bankruptcy. A family doctor who works at a rural hospital, Jessica now understands why some of her patients avoid testing and treatment for fear of the cost. "It's very, very frustrating to be a patient, and it's very disempowering to feel like you can't make an informed choice because you can't get the information you need."
The takeaway: Dialysis is a necessary, lifesaving treatment. It is not optional — no matter a patient's financial situation.
Insurers are obligated to have adequate networks for all covered medical services in their plans, though "adequacy" is poorly defined.
So, if it looks like there isn't an in-network option within a reasonable distance — for dialysis or more basic services from orthopedists or dermatologists — keep digging. Keep in mind that dialysis clinics may be listed as "facilities" rather than "providers" in your directory.
If none are available, seek help from your state's insurance commissioner. Report your experiences — that's one way the commissioner can learn that the names listed in the directory aren't taking patients or are 50 miles away, for example.
If you have insurance through an employer, you can contact your benefits department to go to bat for you. If there is no in-network option, you should get a dispensation to go out of network at in-network rates and with in-network copayments.
If you receive a bill for out-of-network care, don't merely write the check. Ask for an itemized bill and review the charges. You can also ask your insurance company to negotiate with the provider on your behalf. See if the bill counts as a "surprise bill" under your state's law, in which case you could be "held harmless" from excessive charges.
And when all else fails, try to negotiate directly with the provider. They might have a financial assistance policy, or be willing to lower the cost significantly to avoid turning you over to a debt collector that would pay them pennies on the dollar.
NPR produced and edited the interview with Kaiser Health News' Elisabeth Rosenthal for broadcast. Nick Mott of Montana Public Radio provided audio reporting. The digital version of this story was updated July 22 to include a fuller explanation of the insurance company's account of what the Valentines were told about dialysis clinics in its network.
Bill of the Month is a crowdsourced investigation by Kaiser Health News and NPR that dissects and explains medical bills. Do you have an interesting medical bill you want to share with us? Tell us about it here.
NOEL KING, HOST:
All right, we're going to talk today about our medical bill of the month for the month of July. We have seen some pretty outrageous bills sent in by our listeners, but this is the biggest one we've seen yet.
Dr. Elisabeth Rosenthal is the editor-in-chief of our partner Kaiser Health News, and she's in the studio to tell us about it. Hi, Elisabeth.
ELISABETH ROSENTHAL, BYLINE: Good to be here. Yes, this one's a doozy.
KING: This month's bill went to a couple in the state of Montana.
ROSENTHAL: Yeah, this month, we meet Jessica and Sov Valentine. They've run into what can happen to you when you have to go out-of-network for kidney dialysis or any other procedure, frankly.
KING: So being in and out of network can be confusing for a lot of people. It was in this case. We sent reporter Nick Mott to visit the Valentines in their home in Plains, Mont.
NICK MOTT, BYLINE: Sov Valentine is in his garage-turned-gym doing some leg extensions. He's been a personal trainer for three decades. But right now, he's skinny as a rail.
SOV VALENTINE: When I first got sick, I - honestly, I was laying in bed with a two-pound dumbbell.
MOTT: He says he's doing everything he can to stay strong and fit so he can be ready for a kidney transplant when the time comes.
VALENTINE: After all these years, I know that if you don't maintain what you have, even if it's just doing two pounds, you're in trouble.
VALENTINE: Back in January, he'd been feeling weak and fatigued during his workouts. Then one day, he started vomiting. He knew something was seriously wrong, and he went to the hospital. But Plains, Mont. is a small town. And there was only one physician working when he got there. It was his wife, Jessica.
JESSICA VALENTINE: He just showed up at the front desk, so...
MOTT: What were you thinking?
VALENTINE: Oh, shoot.
MOTT: His kidneys were covered in cysts, and they were barely functioning. He'd need to start dialysis immediately.
VALENTINE: It's just shock. I mean, there's no other way to describe it.
MOTT: He's 50, really young for such a major health issue. It's a lot to deal with.
VALENTINE: What I do is just focus on what the one task is, whether it's big or small. Get through that, and don't worry about anything else.
MOTT: While Sov took it one day at a time, Jessica started doing the dirty work of figuring out what all this was going to cost.
VALENTINE: So I am pretty familiar with navigating the system because I have to do it for my work all the time. So I call insurance companies and try to get things authorized for patients as part of my job.
MOTT: Their insurance company said all the dialysis options in Montana were out-of-network. So Jessica called Fresenius, a dialysis center. The center said they couldn't give them an estimate and referred them back to their insurance, who referred them back to Fresenius and on and on.
Sov started treatments three times a week at Fresenius. As the time passed, the Valentines held their breath.
VALENTINE: While the bills were adding up, we didn't have any idea what the bills might be. So we didn't get any bills until he was essentially almost done at Fresenius.
MOTT: The first bill came in late March after 2 1/2 months of treatment. It was for $120,000. Jessica called Fresenius immediately. After several phone calls, all she found out is that they might be eligible for financial aid.
VALENTINE: That is ridiculous. I don't know who would be able to possibly do that. It's crazy.
MOTT: Then more bills came. That number grew to more than half a million dollars. They received a collection notice, too.
VALENTINE: It just doesn't seem real.
MOTT: Sov keeps taking things one step at a time. They kept digging and eventually found an in-network dialysis center at a fraction of the cost. They applied for financial aid from Fresenius and Medicare. The stress of being sick, of owing so much money, it compounds.
VALENTINE: I'm focusing on keeping my energy to heal. You know, I'm headed for a transplant. And I don't want to wear myself out, which is what this does.
MOTT: Sov's wife is a doctor, and he has good insurance. But he says he knows not everyone has the same luck.
KING: That was Nick Mott with Montana Public Radio. OK, Elizabeth, so Sov told Nick that he feels lucky. But he still has a half a million dollar bill that he's got to pay. Will Fresenius negotiate with him at all?
ROSENTHAL: Well, the company did come back to the Valentines and offered to cut it by 50%. But, you know, that's still more than Jessica owes in student loans for med school and, frankly, more than many kidney transplants would cost.
KING: This couple in Montana are not the only people in this country having problems with the cost of dialysis. The federal government has actually started paying attention to this, right?
ROSENTHAL: Yeah, I mean, dialysis has gotten some headlines because the Trump administration wants to make some changes that could result in taxpayers saving some money on dialysis care. It's mostly a cost to the federal government. And that's because the vast majority of people who need dialysis, people who develop end-stage renal disease like Sov, can get on Medicare under a 1973 bill.
But there's a catch to that, and they have to wait 90 days until they qualify. And that's where Sov gets really stuck.
KING: And once you're on Medicare, how much does it pay?
ROSENTHAL: Well, here's the crazy thing. Medicare pays about $235 per dialysis session. Meanwhile, Fresenius charged Sov $14,000 a session - huge gap there. And remember; end-stage renal disease is life-threatening. When you need dialysis, you need it, and you need dialysis three times a week.
KING: Could he have gone someplace other than Fresenius?
ROSENTHAL: Well, there aren't a lot of options. Fresenius and one other company, DaVita, control about 70% of the dialysis market in the U.S. And since Medicare picks up the tab after that 90-day wait, the companies play hardball with insurers for patients who have private insurance. It looks like they're simply trying to charge whatever they think they can get away with.
KING: So it sounds like what you're saying is there was not much they could have done to prevent this bill.
ROSENTHAL: Well, they were told there were no in-network options. He needed immediate dialysis. And when Jessica checked, that appeared to be the case. If there's no way to stay in network for needed care, under some state laws that could be considered a surprise bill, so fight it.
Also, President Trump's announcement earlier this month could have offered some help in that it's promoting alternative types of dialysis that can be done at home. But for now, the Valentines are in a tough position.
KING: So what's their plan? How are they doing now?
ROSENTHAL: Well, after discovering that there was an in-network provider in state that hadn't turned up in the directory, Sov is getting his dialysis there now. And pretty soon, he'll be eligible for Medicare. But what he's really hoping for is to get a kidney transplant soon.
Also, sadly, this hardworking couple is considering filing for bankruptcy if they have to pay that bill.
KING: Dr. Elisabeth Rosenthal from Kaiser Health News, thanks so much for being here.
(SOUNDBITE OF MUSIC)
KING: If you have a baffling or surprising medical bill that you want us to take a look at, go to NPR's Shots blog and tell us all about it. Transcript provided by NPR, Copyright NPR.