After a college student finally found a treatment that worked, the insurance giant decided it wouldn't pay for the costly drugs. His fight to get coverage exposed the insurer's hidden procedures for rejecting claims.
This article was published on Thursday, February 2, 2023 in ProPublica.
By David Armstrong, Patrick Rucker and Maya Miller
In May 2021, a nurse at UnitedHealthcare called a colleague to share some welcome news about a problem the two had been grappling with for weeks.
United provided the health insurance plan for students at Penn State University. It was a large and potentially lucrative account: lots of young, healthy students paying premiums in, not too many huge medical reimbursements going out.
But one student was costing United a lot of money. Christopher McNaughton suffered from a crippling case of ulcerative colitis — an ailment that caused him to develop severe arthritis, debilitating diarrhea, numbing fatigue and life-threatening blood clots. His medical bills were running nearly $2 million a year.
United had flagged McNaughton's case as a "high dollar account," and the company was reviewing whether it needed to keep paying for the expensive cocktail of drugs crafted by a Mayo Clinic specialist that had brought McNaughton's disease under control after he'd been through years of misery.
On the 2021 phone call, which was recorded by the company, nurse Victoria Kavanaugh told her colleague that a doctor contracted by United to review the case had concluded that McNaughton's treatment was "not medically necessary." Her colleague, Dave Opperman, reacted to the news with a long laugh.
"I knew that was coming," said Opperman, who heads up a United subsidiary that brokered the health insurance contract between United and Penn State. "I did too," Kavanaugh replied.
UnitedHealthcare Employees Discuss the Denial of Chris McNaughton's Claim
David Opperman is an insurance broker who works for UnitedHealthcare. Victoria Kavanaugh is a nurse for United. In this recorded phone call from 2021, the two express relief that a doctor has turned down Penn State student Chris McNaughton's claim as "not medically necessary."
Opperman then complained about McNaughton's mother, whom he referred to as "this woman," for "screaming and yelling" and "throwing tantrums" during calls with United.
The pair agreed that any appeal of the United doctor's denial of the treatment would be a waste of the family's time and money.
"We're still gonna say no," Opperman said.
More than 200 million Americans are covered by private health insurance. But data from state and federal regulators shows that insurers reject about 1 in 7 claims for treatment. Many people, faced with fighting insurance companies, simply give up: One study found that Americans file formal appeals on only 0.1% of claims denied by insurers under the Affordable Care Act.
Insurers have wide discretion in crafting what is covered by their policies, beyond some basic services mandated by federal and state law. They often deny claims for services that they deem not "medically necessary."
When United refused to pay for McNaughton's treatment for that reason, his family did something unusual. They fought back with a lawsuit, which uncovered a trove of materials, including internal emails and tape-recorded exchanges among company employees. Those records offer an extraordinary behind-the-scenes look at how one of America's leading health care insurers relentlessly fought to reduce spending on care, even as its profits rose to record levels.
As United reviewed McNaughton's treatment, he and his family were often in the dark about what was happening or their rights. Meanwhile, United employees misrepresented critical findings and ignored warnings from doctors about the risks of altering McNaughton's drug plan.
At one point, court records show, United inaccurately reported to Penn State and the family that McNaughton's doctor had agreed to lower the doses of his medication. Another time, a doctor paid by United concluded that denying payments for McNaughton's treatment could put his health at risk, but the company buried his report and did not consider its findings. The insurer did, however, consider a report submitted by a company doctor who rubber-stamped the recommendation of a United nurse to reject paying for the treatment.
United declined to answer specific questions about the case, even after McNaughton signed a release provided by the insurer to allow it to discuss details of his interactions with the company. United noted that it ultimately paid for all of McNaughton's treatments. In a written response, United spokesperson Maria Gordon Shydlo wrote that the company's guiding concern was McNaughton's well-being.
"Mr. McNaughton's treatment involves medication dosages that far exceed FDA guidelines," the statement said. "In cases like this, we review treatment plans based on current clinical guidelines to help ensure patient safety."
But the records reviewed by ProPublica show that United had another, equally urgent goal in dealing with McNaughton. In emails, officials calculated what McNaughton was costing them to keep his crippling disease at bay and how much they would save if they forced him to undergo a cheaper treatment that had already failed him. As the family pressed the company to back down, first through Penn State and then through a lawsuit, the United officials handling the case bristled.
"This is just unbelievable," Kavanaugh said of McNaughton's family in one call to discuss his case. "They're just really pushing the envelope, and I'm surprised, like I don't even know what to say."
The Same Meal Every Day
McNaughton on the Penn State campus, where he first enrolled in 2020 Credit: Nate Smallwood, special to ProPublica
Now 31, McNaughton grew up in State College, Pennsylvania, just blocks from the Penn State campus. Both of his parents are faculty members at the university.
In the winter of 2014, McNaughton was halfway through his junior year at Bard College in New York. At 6 feet, 4 inches tall, he was a guard on the basketball team and had started most of the team's games since the start of his sophomore year. He was majoring in psychology.
When McNaughton returned to school after the winter holiday break, he started to experience frequent bouts of bloody diarrhea. After just a few days on campus, he went home to State College, where doctors diagnosed him with a severe case of ulcerative colitis.
A chronic inflammatory bowel disease that causes swelling and ulcers in the digestive tract, ulcerative colitis has no cure, and ongoing treatment is needed to alleviate symptoms and prevent serious health complications. The majority of cases produce mild to moderate symptoms. McNaughton's case was severe.
Treatments for ulcerative colitis include steroids and special drugs known as biologics that work to reduce inflammation in the large intestine.
McNaughton, however, failed to get meaningful relief from the drugs his doctors initially prescribed. He was experiencing bloody diarrhea up to 20 times a day, with such severe stomach pain that he spent much of his day curled up on a couch. He had little appetite and lost 50 pounds. Severe anemia left him fatigued. He suffered from other conditions related to his colitis, including crippling arthritis. He was hospitalized several times to treat dangerous blood clots.
For two years, in an effort to help alleviate his symptoms, he ate the same meals every day: Rice Chex cereal and scrambled eggs for breakfast, a cup of white rice with plain chicken breast for lunch and a similar meal for dinner, occasionally swapping in tilapia.
McNaughton at his home in State College, Pennsylvania. When he fell ill with ulcerative colitis he was forced to stop playing college basketball. Credit: Nate Smallwood, special to ProPublica
His hometown doctors referred him to a specialist at the University of Pittsburgh, who tried unsuccessfully to bring his disease under control. That doctor ended up referring McNaughton to Dr. Edward Loftus Jr. at the Mayo Clinic in Minnesota, which has been ranked as the best gastroenterology hospital in the country every year since 1990 by U.S. News & World Report.
For his first visit with Loftus in May 2015, McNaughton and his mother, Janice Light, charted hospitals along the 900-mile drive from Pennsylvania to Minnesota in case they needed medical help along the way.
Mornings were the hardest. McNaughton often spent several hours in the bathroom at the start of the day. To prepare for his meeting with Loftus, he set his alarm for 3:30 a.m. so he could be ready for the 7:30 a.m. appointment. Even with that preparation, he had to stop twice to use a bathroom on the five-minute walk from the hotel to the clinic. When they met, Loftus looked at McNaughton and told him that he appeared incapacitated. It was, he told the student, as if McNaughton were chained to the bathroom, with no outside life. He had not been able to return to school and spent most days indoors, managing his symptoms as best he could.
McNaughton had tried a number of medications by this point, none of which worked. This pattern would repeat itself during the first couple of years that Loftus treated him.
In addition to trying to find a treatment that would bring McNaughton's colitis into remission, Loftus wanted to wean him off the steroid prednisone, which he had been taking since his initial diagnosis in 2014. The drug is commonly prescribed to colitis patients to control inflammation, but prolonged use can lead to severe side effects including cataracts, osteoporosis, increased risk of infection and fatigue. McNaughton also experienced "moon face," a side effect caused by the shifting of fat deposits that results in the face becoming puffy and rounder.
In 2018, Loftus and McNaughton decided to try an unusual regimen. Many patients with inflammatory bowel diseases like colitis take a single biologic drug as treatment. Whereas traditional drugs are chemically synthesized, biologics are manufactured in living systems, such as plant or animal cells. A year's supply of an individual biologic drug can cost up to $500,000. They are often given through infusions in a medical facility, which adds to the cost.
McNaughton receives an infusion of medication to treat his ulcerative colitis at a medical facility in State College. After initially paying for his treatment, UnitedHealthcare began rejecting his insurance claims. Credit: Nate Smallwood, special to ProPublica.
McNaughton had tried individual biologics, and then two in combination, without much success. He and Loftus then agreed to try two biologic drugs together at doses well above those recommended by the U.S. Food and Drug Administration. Prescribing drugs for purposes other than what they are approved for or at higher doses than those approved by the FDA is a common practice in medicine referred to as off-label prescribing. The federal Agency for Healthcare Research and Quality estimates 1 in 5 prescriptions written today are for off-label uses.
There are drawbacks to the practice. Since some uses and doses of particular drugs have not been extensively studied, the risks and efficacy of using them off-label are not well known. Also, some drug manufacturers have improperly pushed off-label usage of their products to boost sales despite little or no evidence to support their use in those situations. Like many leading experts and researchers in his field, Loftus has been paid to do consulting related to the biologic drugs taken by McNaughton. The payments related to those drugs have ranged from a total of $1,440 in 2020 to $51,235 in 2018. Loftus said much of his work with pharmaceutical companies was related to conducting clinical trials on new drugs.
In cases of off-label prescribing, patients are depending upon their doctor's expertise and experience with the drug."In this case, I was comfortable that the potential benefits to Chris outweighed the risks," Loftus said.
There was evidence that the treatment plan for McNaughton might work, including studies that had found dual biologic therapy to be efficacious and safe. The two drugs he takes, Entyvio and Remicade, have the same purpose — to reduce inflammation in the large intestine — but each works differently in the body. Remicade, marketed by Janssen Biotech, targets a protein that causes inflammation. Entyvio, made by Takeda Pharmaceuticals, works by preventing an excess of white blood cells from entering into the gastrointestinal tract.
As for any suggestion by United doctors that his treatment plan for McNaughton was out of bounds or dangerous, Loftus said "my treatment of Chris was not clinically inappropriate — as was shown by Chris' positive outcome."
The unusual high-dose combination of two biologic drugs produced a remarkable change in McNaughton. He no longer had blood in his stool, and his trips to the bathroom were cut from 20 times a day to three or four. He was able to eat different foods and put on weight. He had more energy. He tapered off prednisone.
"If you told me in 2015 that I would be living like this, I would have asked where do I sign up," McNaughton said of the change he experienced with the new drug regimen.
When he first started the new treatment, McNaughton was covered under his family's plan, and all his bills were paid. McNaughton enrolled at the university in 2020. Before switching to United's plan for students, McNaughton and his parents consulted with a health advocacy service offered to faculty members. A benefits specialist assured them the drugs taken by McNaughton would be covered by United.
McNaughton joined the student plan in July 2020, and his infusions that month and the following month were paid for by United. In September, the insurer indicated payment on his claims was "pending," something it did for his other claims that came in during the rest of the year.
McNaughton and his family were worried. They called United to make sure there wasn't a problem; the insurer told them, they said, that it only needed to check his medical records. When the family called again, United told them it had the documentation needed, they said. United, in a court filing last year, said it received two calls from the family and each time indicated that all of the necessary medical records had not yet been received.
In January 2021, McNaughton received a new explanation of benefits for the prior months. All of the claims for his care, beginning in September, were no longer "pending." They were stamped "DENIED." The total outstanding bill for his treatment was $807,086.
When McNaughton's mother reached a United customer service representative the next day to ask why bills that had been paid in the summer were being denied for the fall, the representative told her the account was being reviewed because of "a high dollar amount on the claims," according to a recording of the call.
Misrepresentations
With United refusing to pay, the family was terrified of being stuck with medical bills that would bankrupt them and deprive McNaugton of treatment that they considered miraculous.
They turned to Penn State for help. Light and McNaughton's father, David, hoped their position as faculty members would make the school more willing to intervene on their behalf.
"After more than 30 years on faculty, my husband and I know that this is not how Penn State would want its students to be treated," Light wrote to a school official in February 2021.
In response to questions from ProPublica, Penn State spokesperson Lisa Powers wrote that "supporting the health and well-being of our students is always of primary importance" and that "our hearts go out to any student and family impacted by a serious medical condition." The university, she wrote, does "not comment on students' individual circumstances or disclose information from their records." McNaughton offered to grant Penn State whatever permissions it needed to speak about his case with ProPublica. The school, however, wrote that it would not comment "even if confidentiality has been waived."
The family appealed to school administrators. Because the effectiveness of biologics wanes in some patients if doses are skipped, McNaughton and his parents were worried about even a delay in treatment. His doctor wrote that if he missed scheduled infusions of the drugs, there was "a high likelihood they would no longer be effective."
During a conference call arranged by Penn State officials on March 5, 2021, United agreed to pay for McNaughton's care through the end of the plan year that August. Penn State immediately notified the family of the "wonderful news" while also apologizing for "the stress this has caused Chris and your family."
Behind the scenes, McNaughton's review had "gone all the way to the top" at United's student health plan division, Kavanaugh, the nurse, said in a recorded conversation.
McNaughton had been on the treatment for three years and it had put his disease in remission with no side effects.
The family's relief was short-lived. A month later, United started another review of McNaughton's care, overseen by Kavanaugh, to determine if it would pay for the treatment in the upcoming plan year.
The nurse sent the McNaughton case to a company called Medical Review Institute of America. Insurers often turn to companies like MRIoA to review coverage decisions involving expensive treatments or specialized care.
Kavanaugh, who was assigned to a special investigations unit at United, let her feelings about the matter be known in a recorded telephone call with a representative of MRIoA.
"This school apparently is a big client of ours," she said. She then shared her opinion of McNaughton's treatment. "Really this is a case of a kid who's getting a drug way too much, like too much of a dose," Kavanaugh said. She said it was "insane that they would even think that this is reasonable" and "to be honest with you, they're awfully pushy considering that we are paying through the end of this school year."
On a call with an outside contractor, the United nurse claimed McNaughton was on a higher dose of medication than the FDA approved, which is a common practice known as "off-label prescribing."
MRIoA sent the case to Dr. Vikas Pabby, a gastroenterologist at UCLA Health and a professor at the university's medical school. His May 2021 review of McNaughton's case was just one of more than 300 Pabby did for MRIoA that month, for which he was paid $23,000 in total, according to a log of his work produced in the lawsuit.
In a May 4, 2021 report, Pabby concluded McNaughton's treatment was not medically necessary, because United's policies for the two drugs taken by McNaughton did not support using them in combination.
Insurers spell out what services they cover in plan policies, lengthy documents that can be confusing and difficult to understand. Many policies, such as McNaughton's, contain a provision that treatments and procedures must be "medically necessary" in order to be covered. The definition of medically necessary differs by plan. Some don't even define the term. McNaughton's policy contains a five-part definition, including that the treatment must be "in accordance with the standards of good medical policy" and "the most appropriate supply or level of service which can be safely provided."
Behind the scenes at United, Opperman and Kavanaugh agreed that if McNaughton were to appeal Pabby's decision, the insurer would simply rule against him. "I just think it's a waste of money and time to appeal and send it to another one when we know we're gonna get the same answer," Opperman said, according to a recording in court files. At Opperman's urging, United decided to skip the usual appeals process and arrange for Pabby to have a so-called "peer-to-peer" discussion with Loftus, the Mayo physician treating McNaughton. Such a conversation, in which a patient's doctor talks with an insurance company's doctor to advocate for the prescribed treatment, usually only occurs after a customer has appealed a denial and the appeal has been rejected.
When Kavanaugh called Loftus' office to set up a conversation with Pabby, she explained it was an urgent matter and had been requested by McNaughton. "You know I've just gotten to know Christopher," she explained, although she had never spoken with him. "We're trying to advocate and help and get this peer-to-peer set up."
McNaughton, meanwhile, had no idea at the time that a United doctor had decided his treatment was unnecessary and that the insurer was trying to set up a phone call with his physician.
In the peer-to-peer conversation, Loftus told Pabby that McNaughton had "a very complicated case" and that lower doses had not worked for him, according to an internal MRIoA memo.
Following his conversation with Loftus, Pabby created a second report for United. He recommended the insurer pay for both drugs, but at reduced doses. He added new language saying that the safety of using both drugs at the higher levels "is not established."
When Kavanaugh shared the May 12 decision from Pabby with others at United, her boss responded with an email calling it "great news."
Then Opperman sent an email that puzzled the McNaughtons.
In it, Opperman claimed that Loftus and Pabby had agreed that McNaughton should be on significantly lower doses of both drugs. He said Loftus "will work with the patient to start titrating them down" — or reducing the dosage — "to a normal dose range." Opperman wrote that United would cover McNaughton's treatment in the coming year, but only at the reduced doses. Opperman did not respond to emails and phone messages seeking comment.
McNaughton didn't believe a word of it. He had already tried and failed treatment with those drugs at lower doses, and it was Loftus who had upped the doses, leading to his remission from severe colitis.
The only thing that made sense to McNaughton was that the treatment United said it would now pay for was dramatically cheaper — saving the company at least hundreds of thousands of dollars a year — than his prescribed treatment because it sliced the size of the doses by more than half.
When the family contacted Loftus for an explanation, they were outraged by what they heard. Loftus told them that he had never recommended lowering the dosage. In a letter, Loftus wrote that changing McNaughton's treatment "would have serious detrimental effects on both his short term and long term health and could potentially involve life threatening complications. This would ultimately incur far greater medical costs. Chris was on the doses suggested by United Healthcare before, and they were not at all effective."
It would not be until the lawsuit that it would become clear how Loftus' conversations had been so seriously misrepresented.
Under questioning by McNaughton's lawyers, Kavanaugh acknowledged that she was the source of the incorrect claim that McNaughton's doctor had agreed to a change in treatment.
"I incorrectly made an assumption that they had come to some sort of agreement," she said in a deposition last August. "It was my first peer-to-peer. I did not realize that that simply does not occur."
Kavanaugh did not respond to emails and telephone messages seeking comment.
When the McNaughtons first learned of Opperman's inaccurate report of the phone call with Loftus, it unnerved them. They started to question if their case would be fairly reviewed.
"When we got the denial and they lied about what Dr. Loftus said, it just hit me that none of this matters," McNaughton said. "They will just say or do anything to get rid of me. It delegitimized the entire review process. When I got that denial, I was crushed."
A Buried Report
While the family tried to sort out the inaccurate report, United continued putting the McNaughton case in front of more company doctors.
On May 21, 2021, United sent the case to one of its own doctors, Dr. Nady Cates, for an additional review. The review was marked "escalated issue." Cates is a United medical director, a title used by many insurers for physicians who review cases. It is work he has been doing as an employee of health insurers since 1989 and at United since 2010. He has not practiced medicine since the early 1990s.
Cates, in a deposition, said he stopped seeing patients because of the long hours involved and because "AIDS was coming around then. I was seeing a lot of military folks who had venereal diseases, and I guess I was concerned about being exposed." He transitioned to reviewing paperwork for the insurance industry, he said, because "I guess I was a chicken."
When he had practiced, Cates said, he hadn't treated patients with ulcerative colitis and had referred those cases to a gastroenterologist.
He said his review of McNaughton's case primarily involved reading a United nurse's recommendation to deny his care and making sure "that there wasn't a decimal place that was out of line." He said he copied and pasted the nurse's recommendation and typed "agree" on his review of McNaughton's case.
Dr. Nady Cates, a United Medical Director, Explains That He Copied and Pasted the Text of His Decision to Deny McNaughton's Care
In the deposition, Cates tells McNaughton's lawyer that he copied the recommendation of Pamela Banister, a nurse for United, rather than writing his own decision.
Cates said that he does about a hundred reviews a week. He said that in his reviews he typically checks to see if any medications are prescribed in accordance with the insurer's guidelines, and if not, he denies it. United's policies, he said, prevented him from considering that McNaughton had failed other treatments or that Loftus was a leading expert in his field.
"You are giving zero weight to the treating doctor's opinion on the necessity of the treatment regimen?" a lawyer asked Cates in his deposition. He responded, "Yeah."
Attempts to contact Cates for comment were unsuccessful.
At the same time Cates was looking at McNaughton's case, yet another review was underway at MRIoA. United said it sent the case back to MRIoA after the insurer received the letter from Loftus warning of the life-threatening complications that might occur if the dosages were reduced.
On May 24, 2021, the new report requested by MRIoA arrived. It came to a completely different conclusion than all of the previous reviews.
Dr. Nitin Kumar, a gastroenterologist in Illinois, concluded that McNaughton's established treatment plan was not only medically necessary and appropriate but that lowering his doses "can result in a lack of effective therapy of Ulcerative Colitis, with complications of uncontrolled disease (including dysplasia leading to colorectal cancer), flare, hospitalization, need for surgery, and toxic megacolon."
Unlike other doctors who produced reports for United, Kumar discussed the harm that McNaughton might suffer if United required him to change his treatment. "His disease is significantly severe, with diagnosis at a young age," Kumar wrote. "He has failed every biologic medication class recommended by guidelines. Therefore, guidelines can no longer be applied in this case." He cited six studies of patients using two biologic drugs together and wrote that they revealed no significant safety issues and found the therapy to be "broadly successful."
When Kavanaugh learned of Kumar's report, she quickly moved to quash it and get the case returned to Pabby, according to her deposition.
In a recorded telephone call, Kavanaugh told an MRIoA representative that "I had asked that this go back through Dr. Pabby, and it went through a different doctor and they had a much different result." After further discussion, the MRIoA representative agreed to send the case back to Pabby. "I appreciate that," Kavanaugh replied. "I just want to make sure, because, I mean, it's obviously a very different result than what we've been getting on this case."
MRIoA case notes show that at 7:04 a.m. on May 25, 2021, Pabby was assigned to take a look at the case for the third time. At 7:27 a.m., the notes indicate, Pabby again rejected McNaughton's treatment plan. While noting it was "difficult to control" McNaughton's ulcerative colitis, Pabby added that his doses "far exceed what is approved by literature" and that the "safety of the requested doses is not supported by literature."
In a deposition, Kavanaugh said that after she opened the Kumar report and read that he was supporting McNaughton's current treatment plan, she immediately spoke to her supervisor, who told her to call MRIoA and have the case sent back to Pabby for review.
Kavanaugh said she didn't save a copy of the Kumar report, nor did she forward it to anyone at United or to officials at Penn State who had been inquiring about the McNaughton case. "I didn't because it shouldn't have existed," she said. "It should have gone back to Dr. Pabby."
When asked if the Kumar report caused her any concerns given his warning that McNaughton risked cancer or hospitalization if his regimen were changed, Kavanaugh said she didn't read his full report. "I saw that it was not the correct doctor, I saw the initial outcome and I was asked to send it back," she said. Kavanaugh added, "I have a lot of empathy for this member, but it needed to go back to the peer-to-peer reviewer."
In a court filing, United said Kavanaugh was correct in insisting that Pabby conduct the review and that MRIoA confirmed that Pabby should have been the one doing the review.
The Kumar report was not provided to McNaughton when his lawyer, Jonathan Gesk, first asked United and MRIoA for any reviews of the case. Gesk discovered it by accident when he was listening to a recorded telephone call produced by United in which Kavanaugh mentioned a report number Gesk had not heard before. He then called MRIoA, which confirmed the report existed and eventually provided it to him.
Pabby asked ProPublica to direct any questions about his involvement in the matter to MRIoA. The company did not respond to questions from ProPublica about the case.
A Sense of Hopelessness
McNaughton on the Penn State campus Credit: Nate Smallwood, special to ProPublica
When McNaughton enrolled at Penn State in 2020, it brought a sense of normalcy that he had lost when he was first diagnosed with colitis. He still needed monthly hours-long infusions and suffered occasional flare-ups and symptoms, but he was attending classes in person and living a life similar to the one he had before his diagnosis.
It was a striking contrast to the previous six years, which he had spent largely confined to his parents' house in State College. The frequent bouts of diarrhea made it difficult to go out. He didn't talk much to friends and spent as much time as he could studying potential treatments and reviewing ongoing clinical trials. He tried to keep up with the occasional online course, but his disease made it difficult to make any real progress toward a degree.
United, in correspondence with McNaughton, noted that its review of his care was "not a treatment decision. Treatment decisions are made between you and your physician." But by threatening not to pay for his medications, or only to pay for a different regimen, McNaughton said, United was in fact attempting to dictate his treatment. From his perspective, the insurer was playing doctor, making decisions without ever examining him or even speaking to him.
The idea of changing his treatment or stopping it altogether caused constant worry for McNaughton, exacerbating his colitis and triggering physical symptoms, according to his doctors. Those included a large ulcer on his leg and welts under his skin on his thighs and shin that made his leg muscles stiff and painful to the point where he couldn't bend his leg or walk properly. There were daily migraines and severe stomach pain. "I was consumed with this situation," McNaughton said. "My path was unconventional, but I was proud of myself for fighting back and finishing school and getting my life back on track. I thought they were singling me out. My biggest fear was going back to the hell."
McNaughton said he contemplated suicide on several occasions, dreading a return to a life where he was housebound or hospitalized.
McNaughton and his parents talked about him possibly moving to Canada where his grandmother lived and seeking treatment there under the nation's government health plan.
Loftus connected McNaughton with a psychologist who specializes in helping patients with chronic digestive diseases.
The psychologist, Tiffany Taft, said McNaughton was not an unusual case. About 1 in 3 patients with diseases like colitis suffer from medical trauma or PTSD related to it, she said, often the result of issues related to getting appropriate treatment approved by insurers.
"You get into hopelessness," she said of the depression that accompanies fighting with insurance companies over care. "They feel like ‘I can't fix that. I am screwed.' When you can't control things with what an insurance company is doing, anxiety, PTSD and depression get mixed together."
In the case of McNaughton, Taft said, he was being treated by one of the best gastroenterologists in the world, was doing well with his treatment and then was suddenly notified he might be on the hook for nearly a million dollars in medical charges without access to his medications. "It sends you immediately into panic about all these horrific things that could happen," Taft said. The physical and mental symptoms McNaughton suffered after his care was threatened were "triggered" by the stress he experienced, she said.
In early June 2021, United informed McNaughton in a letter that it would not cover the cost of his treatment regimen in the next academic year, starting in August. The insurer said it would only pay for a treatment plan that called for a significant reduction in the doses of the drugs he took.
United wrote that the decision came after his "records have been reviewed three times and the medical reviewers have concluded that the medication as prescribed does not meet the Medical Necessity requirement of the plan."
In August 2021, McNaughton filed a federal lawsuit accusing United of acting in bad faith and unreasonably making treatment decisions based on financial concerns and not what was the best and most effective treatment. It claims United had a duty to find information that supported McNaughton's claim for treatment rather than looking for ways to deny coverage.
United, in a court filing, said it did not breach any duty it owed to McNaughton and acted in good faith. On Sept. 20, 2021, a month after filing the lawsuit, and with United again balking at paying for his treatment, McNaughton asked a judge to grant a temporary restraining order requiring United to pay for his care. With the looming threat of a court hearing on the motion, United quickly agreed to cover the cost of McNaughton's treatment through the end of the 2021-2022 academic year. It also dropped a demand requiring McNaughton to settle the matter as a condition of the insurer paying for his treatment as prescribed by Loftus, according to an email sent by United's lawyer.
The Cost of Treatment
An order form for medications given to McNaughton Credit: Nate Smallwood, special to ProPublica
It is not surprising that insurers are carefully scrutinizing the care of patients treated with biologics, which are among the most expensive medications on the market. Biologics are considered specialty drugs, a class that includes the best-selling Humira, used to treat arthritis. Specialty drug spending in the U.S. is expected to reach $505 billion in 2023, according to an estimate from Optum, United's health services division. The Institute for Clinical and Economic Review, a nonprofit that analyzes the value of drugs, found in 2020 that the biologic drugs used to treat patients like McNaughton are often effective but overpriced for their therapeutic benefit. To be judged cost-effective by ICER, the biologics should sell at a steep discount to their current market price, the panel found.
A panel convened by ICER to review its analysis cautioned that insurance coverage "should be structured to prevent situations in which patients are forced to choose a treatment approach on the basis of cost." ICER also found examples where insurance company policies failed to keep pace with updates to clinical practice guidelines based on emerging research.
United officials did not make the cost of treatment an issue when discussing McNaughton's care with Penn State administrators or the family.
Bill Truxal, the president of UnitedHealthcare StudentResources, the company's student health plan division, told a Penn State official that the insurer wanted the "best for the student" and it had "nothing to do with cost," according to notes the official took of the conversation.
Behind the scenes, however, the price of McNaughton's care was front and center at United.
In one email, Opperman asked about the cost difference if the insurer insisted on only paying for greatly reduced doses of the biologic drugs. Kavanaugh responded that the insurer had paid $1.1 million in claims for McNaughton's care as of the middle of May 2021. If the reduced doses had been in place, the amount would have been cut to $260,218, she wrote.
United was keeping close tabs on McNaughton at the highest levels of the company. On Aug. 2, 2021, Opperman notified Truxal and a United lawyer that McNaughton "has just purchased the plan again for the 21-22 school year."
A month later, Kavanaugh shared another calculation with United executives showing that the insurer spent over $1.7 million on McNaughton in the prior plan year.
United officials strategized about how to best explain why it was reviewing McNaughton's drug regimen, according to an internal email. They pointed to a justification often used by health insurers when denying claims. "As the cost of healthcare continues to climb to soaring heights, it has been determined that a judicious review of these drugs should be included" in order to "make healthcare more affordable for our members," Kavanaugh offered as a potential talking point in an April 23, 2021, email.
Three days later, UnitedHealth Group filed an annual statement with the U.S. Securities and Exchange Commission disclosing its pay for top executives in the prior year. Then-CEO David Wichmann was paid $17.9 million in salary and other compensation in 2020. Wichmann retired early the following year, and his total compensation that year exceeded $140 million, according to calculations in a compensation database maintained by the Star Tribune in Minneapolis. The newspaper said the amount was the most paid to an executive in the state since it started tracking pay more than two decades ago. About $110 million of that total came from Wichmann exercising stock options accumulated during his stewardship.
The McNaughtons were well aware of the financial situation at United. They looked at publicly available financial results and annual reports. Last year, United reported a profit of $20.1 billion on revenues of $324.2 billion.
When discussing the case with Penn State, Light said, she told university administrators that United could pay for a year of her son's treatment using just minutes' worth of profit.
'Betrayed'
McNaughton looks out a window at his home in State College. Credit: Nate Smallwood, special to ProPublica
McNaughton has been able to continue receiving his infusions for now, anyway. In October, United notified him it was once again reviewing his care, although the insurer quickly reversed course when his lawyer intervened. United, in a court filing, said the review was a mistake and that it had erred in putting McNaughton's claims into pending status.
McNaughton said he is fortunate his parents were employed at the same school he was attending, which was critical in getting the attention of administrators there. But that help had its limits.
In June 2021, just a week after United told McNaughton it would not cover his treatment plan in the upcoming plan year, Penn State essentially walked away from the matter.
In an email to the McNaughtons and United, Penn State Associate Vice President for Student Affairs Andrea Dowhower wrote that administrators "have observed an unfortunate breakdown in communication" between McNaughton and his family and the university health insurance plan, "which appears from our perspective to have resulted in a standstill between the two parties." While she proposed some potential steps to help settle the matter, she wrote that "Penn State's role in this process is as a resource for students like Chris who, for whatever reason, have experienced difficulty navigating the complex world of health insurance." The university's role "is limited," she wrote, and the school "simply must leave" the issue of the best treatment for McNaughton to "the appropriate health care professionals."
In a statement, a Penn State spokesperson wrote that "as a third party in this arrangement, the University's role is limited and Penn State officials can only help a student manage an issue based on information that a student/family, medical personnel, and/or insurance provider give — with the hope that all information is accurate and that the lines of communication remain open between the insured and the insurer."
Penn State declined to provide financial information about the plan. However, the university and United share at least one tie that they have not publicly disclosed.
When the McNaughtons first reached out to the university for help, they were referred to the school's student health insurance coordinator. The official, Heather Klinger, wrote in an email to the family in February 2021 that "I appreciate your trusting me to resolve this for you."
In April 2022, United began paying Klinger's salary, an arrangement which is not noted on the university website. Klinger appears in the online staff directory on the Penn State University Health Services webpage, and has a university phone number, a university address and a Penn State email listed as her contact. The school said she has maintained a part-time status with the university to allow her to access relevant data systems at both the university and United.
The university said students "benefit" from having a United employee to handle questions about insurance coverage and that the arrangement is "not uncommon" for student health plans.
The family was dismayed to learn that Klinger was now a full-time employee of United.
"We did feel betrayed," Light said. Klinger did not respond to an email seeking comment.
McNaughton's fight to maintain his treatment regimen has come at a cost of time, debilitating stress and depression. "My biggest fear is realizing I might have to do this every year of my life," he said.
McNaughton said one motivation for his lawsuit was to expose how insurers like United make decisions about what care they will pay for and what they will not. The case remains pending, a court docket shows.
He has been accepted to Penn State's law school. He hopes to become a health care lawyer working for patients who find themselves in situations similar to his.
He plans to reenroll in the United health care plan when he starts school next fall.
Money and lobbying help shield lab-developed tests, including prenatal screenings, from heightened federal scrutiny.
A number of tests used by patients to make major healthcare decisions have once again escaped regulation by the Food and Drug Administration, following intensive lobbying on behalf of test-makers, professional associations and academic medical centers.
ProPublica recently published an investigation about popular prenatal screenings that fall into this category, which one expert described as an unregulated "Wild West." Upwards of half of all pregnant people now receive one of these prenatal screenings. (We also have put together a guide for expecting parents.)
Congress was on the cusp of finally creating a pathway for the FDA to scrutinize these tests, as it does for many other common commercial tests. For much of 2022, the VALID Act seemed on track for passage — and then, in the final weeks of the year, legislators backed away.
The VALID Act, which had bipartisan support, had been developed after nearly a decade of debate among stakeholders about ways to close a regulatory loophole and clarify the FDA's role in overseeing the testing industry. The legislation had momentum thanks, in part, to Theranos' fraudulent blood-testing scandal and the coronavirus pandemic, both of which revealed the possible consequences of unchecked tests reaching patients.
But lawmakers left VALID out of a must-pass end-of-year bill that dealt with a range of spending priorities.
Opponents argued that VALID would have created burdensome regulations for lab-developed tests, or LDTs, stunting essential innovation and flexibility while limiting patient access to healthcare.
The current approach to lab-developed tests goes back to 1976, when Congress revamped the regulation of medical devices. At the time, the tests were considered low-risk and were not in wide use. Since then, the FDA has effectively exempted this type of lab test from its requirements.
Today, the number and complexity of lab-developed tests has grown. A study by the Pew Charitable Trust said there's no way of knowing how many are used on patients each year because there are no tracking measures. But Pew estimated that 12,000 labs are likely to use LDTs, many of which process thousands of patient samples each day.
"The needs were getting bigger and bigger, and also the potential risks get bigger and bigger, too," said Mark McClellan, who served as the head of both the FDA and the Centers for Medicare and Medicaid Services during President George W. Bush's administration. He had urged Congress to pass the bill.
Several people involved in bill negotiations told ProPublica that concern over how it would affect academic labs is what killed it.
Bucshon pointed to the Association of American Medical Colleges and the Association for Molecular Pathology as particularly influential forces that persuaded his colleagues to leave VALID out of the end-of-year bill. According to disclosure forms, AAMC spent at least $300,000 on lobbying activities that included the VALID Act in 2022, while AMP spent at least $189,000. Since 2018, AMP spent at least $957,000 on lobbying activities that included VALID.
AMP had also urged academic lab leaders to reach out to elected officials about this issue. It shared sample letters for them to sign and send, and it organized a "Virtual Advocacy Day," where AMP scheduled meetings between members and their representatives in Washington, providing them with talking points, background information and best practices.
"Here's the thing," Bucshon said. "The academic medical centers, and big medical centers, are in every state." They employ a lot of people and have significant economic impact in every lawmaker's turf, he said, "and so that gives them a pretty big voice."
Heather Pierce, AAMC's senior director for science policy and regulatory counsel, said that many academic medical centers make and use a number of lab-developed tests, and they typically don't have the infrastructure or staff to handle the type of FDA oversight set out by VALID. FDA review, she said, would also add time to the process of developing tests for patients with urgent needs.
The makers of prenatal screening tests weighed in on the bill, too. Illumina, for example, spent more than $3 million over two quarters of 2022 on lobbying activities that included provisions of the VALID Act. And since 2019, Invitae paid at least $950,500 on lobbying activities that included VALID.
"While we support efforts to make sure that lab-developed testing is high quality, Invitae believes that the VALID Act would increase the cost of testing, slow innovation, and force consolidation in the industry while imposing many requirements that do little to improve patient care," said a spokesperson in an email.
While some proponents of the bill still hold out hope for the VALID Act, others said it's unlikely to get traction again anytime soon. Several of those involved said they anticipate the FDA, which has long claimed jurisdiction over the tests, will try to use its current powers to take direct action, though that will likely take more time and could face litigation from opponents.
"While we stand ready to work with Congress, we are considering all options," an FDA press officer said in a statement. "One of those options is administrative action, which could include rulemaking."
Speaking at a trade conference in October, FDA Commissioner Robert Califf said that going it alone is "not something we want to do, because having a clear law passed leads to the best situation." But, he said, if nothing passes, "we also can't stand by."
Current and former FDA officials have expressed befuddlement at how difficult it has been to regulate these tests. "There's almost a point of, what do I need to do?" Jeff Shuren, director of the FDA's Center for Devices and Radiological Health, said to a trade journal in October. "Do I need a pile of dead bodies before somebody says enough is enough?"
Some opponents of VALID acknowledge that lab testing reform is needed. But they said it should be done without involving the FDA. AMP's proposed policy, for example, would update the existing oversight system under the Centers for Medicaid and Medicare, which reviews lab operations.
Sen. Rand Paul, a Republican from Kentucky and a former physician, introduced an alternative bill that would do just this, dubbed the VITAL Act. An aide to Paul said the issue came to his attention after AMP approached him about it several years ago. Paul is expected to re-introduce the VITAL Act this year.
While the Centers for Medicaid and Medicare monitor the quality standards in labs, no federal agency checks to make sure lab-developed tests work the way they claim to before they reach patients; similarly, no agency vets the marketing before the tests are sold. Companies aren't required to publicly report so-called adverse events — incidents that happen when the tests get it wrong. And no federal agency has recall authority.
The VALID Act would have phased in the FDA review process over time, with the agency evaluating only high-risk tests — ones where an inaccurate result could lead to serious harm.
Momentum for VALID began to stall in the summer, with a push for an amendment that would exempt academic medical centers.
"I do think that the fact that we couldn't get it done in July and August really created this opportunity for people to poke holes in the boat, as it were," said Cara Tenenbaum, a former FDA policy adviser. "This protracted process allowed people who maybe were not otherwise engaged, or fully engaged, to have an outsized effect that I don't think was in the interest of patients."
Pew declined to comment on the proceedings. Tenenbaum lobbied in support of VALID on behalf of Pew.
Bucshon said he understands the concerns of regulatory skeptics. "Include me in that category, if it's unnecessary and inappropriate regulation that stymies innovation and technology advancements," Bucshon said. "This isn't one of those situations, in my opinion."
Medicare's COVID-19 testing costs reached over $2 billion in 2022. The growing costs concern some experts, who say financial incentives and a lack of regulation early in the pandemic led to fraud and overspending.
This article was published on Saturday, December 30, 2022 in ProPublica.
As the COVID-19 pandemic continues to churn, Medicare spending on testing for the virus continued to increase in 2022 and is outpacing the two prior years.
Through Oct. 31, Medicare had spent $2 billion on COVID-19 tests in 2022, an amount that will surpass last year's total as claims are filed, according to new data provided to ProPublica by CareSet, a research organization that works to make the healthcare system more transparent.
That compares to $2 billion for all of 2021 and $1.5 billion in 2020, a recent analysis by the Department of Health and Human Services' Office of Inspector General shows.
Fraud and overspending are contributing to the increases, experts say, because federal money for COVID-19 testing is not subject to some of the same financial and regulatory constraints as other tests covered by Medicare, the government insurance program for people 65 and older and the disabled.
The growing costs concern some of these experts, who say the need for financial incentives to expand the availability of testing has passed.
Early in the pandemic, testing was both critical to slowing the spread of the virus and in short supply. So the federal government enacted measures to make it more profitable to get in the COVID-19 testing business. Good for the duration of the public health emergency, which has not yet expired, the measures include a generous Medicare reimbursement rate, requirements for private insurance to cover testing — even compelling insurance plans to pay whatever cash price is demanded by out-of-network labs — and a hefty fund for testing those people who didn't have insurance.
The measures succeeded in drawing new and existing labs into the COVID-19 business and helped ensure most people had access to testing, even if some faced excessive waits to get their results. But the incentives also attracted price-gougers, fraudsters and people with no experience in the laboratory business. The result was a chaotic approach that ranged from bungled testing programs and confusion over new requirements to outright fraud.
"It was an unprecedented wave of fraud," said Michael Cohen, an operations officer with the HHS Inspector General, which investigates crimes involving federal healthcare programs.
This year, ProPublica detailed how one Chicago-based lab, Northshore Clinical, used political connections in Nevada to speed its licensing and generated tremendous volume through agreements with school districts, universities and local governments. The story also detailed questionable billing practices that one insurance expert described as fraudulent. A study of Northshore's testing on the University of Nevada Reno campus found the company missed 96% of COVID-19 cases during December 2021.
The company submitted 600 pages of documentation to state regulators to support its claim that it fixed deficiencies noted by inspectors, but it ultimately asked the state to close its license and pulled out of Nevada before the investigation was finished. Northshore repeatedly declined to comment to ProPublica.
The OIG, which had been investigating Northshore in Illinois, expanded its probe to Nevada after ProPublica published its report.
Cohen said OIG investigators have faced challenges responding to the onslaught of suspected fraud — from a lack of additional resources to constantly evolving policies.
In April, the Department of Justice announced criminal charges against people in eight states who allegedly submitted more than $149 million in COVID-19 false billings to federal programs. The OIG has also performed analyses on Medicare data, including for a report released this month that found 378 labs had billed Medicare for expensive add-on tests at "questionably high levels" after testing individuals for COVID-19.
Attorneys general in a handful of states have taken action against labs for forging results, charging fees for "expedited results" that arrived days later and deceptive marketing practices.
Programs to pay for COVID-19 testing aren't the only pandemic assistance funds that have attracted people seeking to profit. Paycheck Protection Program loans went to fake businesses or were spent on luxury goods instead of keeping people employed, ProPublica and other news outlets have reported. Expanded state unemployment programs also saw unprecedented fraud that a partial accounting estimates is $57.3 billion.
Tolerating some fraud is a necessary trade-off to attain legitimate public policy goals, said Loren Adler, associate director of the USC-Brookings Schaeffer Initiative for Health Policy. But once the incentives and loose regulations boosted the availability of testing, they could have been revised to prevent abuse and overspending, he argued.
"We were in a very different world in April 2020," Adler said. "We needed to overpay because we needed more capacity. Once we scaled up, it was no longer necessary. We could've saved a lot of taxpayer money."
According to the data provided by CareSet, more than 2,300 new labs have enrolled as Medicare providers since the pandemic began and have been billing for COVID-19 testing, evidence of the increased capacity generated by the federal measures.
Total Medicare spending on COVID-19 testing is a small fraction of the $4 trillion federal response to the pandemic. That figure includes not only testing and treatment but also direct support for individuals, businesses, schools and local governments. Adler said that may be why lawmakers haven't revisited the incentives.
Still, testing — as funded by Medicare, private insurance and other federal assistance programs — was a lucrative corner of the pandemic response for many providers.
Labs with troubled operations reaped millions from Medicare, the CareSet data shows.
Northshore Clinical, for example, submitted $6.2 million in Medicare claims for COVID-19 testing between Jan. 1, 2021, and Nov. 30, 2022. Doctors Clinical Laboratory, which is facing lawsuits filed by attorneys general in three states, billed $252,000 in 2021. Doctors Clinical did not respond to requests for comment.
Curative Labs, one of the largest COVID-19 testing providers in the country, has billed Medicare $32 million for testing since Jan. 1, 2021. Curative, launched in California by a 25-year-old college dropout, tapped political connections to land a no-bid contract to test in Colorado's nursing homes, according to the Colorado Springs Gazette. But the state's decision to use Curative tests on individuals without symptoms — a use the tests had not been authorized for — led to unreliable results, as Colorado's nursing home death rate was the highest in the nation, according to CPR News. The FDA later revoked authorization for Curative tests and the state canceled its contract with the company.
"During the pandemic, Curative provided millions of Americans with a safe, accessible and reliable way to test for the virus, including when it was extremely difficult to obtain a COVID-19 test," a Curative spokesperson said. "Our teams deployed tests in an efficient manner, helping to prevent the spread of outbreaks in communities across the state of Colorado and throughout the country."
The spokesperson also pointed to a Colorado legislative committee's decision not to audit the procurement process as an exoneration of Curative's operations in the state. The request for the audit failed in a tied vote along party lines after a state official testified she made the decision to use Curative based on the best science available at the time.
"Nomi Health was one of the first partners to provide open accessible testing at scale on behalf of our partners," Nomi's co-founder and chief operations officer Joshua Walker said in a statement. "We remain one of the few providers in the markets we serve providing important access to this needed service."
Walker said Nomi continues to provide free tests for uninsured individuals despite the end of the federal program that paid for those tests. "We still feel strongly that open and easy access is an important part of keeping our communities safe and helping to drive our economy forward."
The OIG's Cohen said the most common crime investigated by his agency was identity theft. Nefarious labs would snag Medicare beneficiaries' information and use it to bill for services not provided or expensive and unnecessary add-on tests.
"They would take it all. ‘We need your Medicare number. We need your Social Security number. Oh, we need credit card information.' People were giving up just tons of information because people were understandably clamoring for tests," Cohen said.
Medicare wasn't the only government program targeted for laboratory fraud.
healthcare providers found quick access to money in the federal fund for testing people without insurance. The program, run by another federal agency, the Health Resources and Services Administration, was designed to get money out fast and with few restrictions. "Bad actors bled the program for as much as they could," Cohen said.
The program was initially funded by Congress with $2 billion. It ended up paying out $11 billion in testing claims. Congress opted not to allocate any more money into it and HRSA stopped accepting claims in March 2022 — leaving many uninsured individuals on the hook for COVID-19 care.
An HHS official said safeguards against fraud were put in place and any providers caught abusing the program could be subject to enforcement measures.
"The COVID-19 Uninsured Program was designed to ensure that every person in the United States had access to COVID-19 testing, treatment and vaccines — regardless of insurance status — and has been successful in getting care to the most vulnerable among us," the official said.
As the pandemic has evolved, how people test for the virus has changed too. Now, instead of getting lab tests, many patients opt to use at-home rapid tests. And that has opened up another opportunity for fraud, experts say.
While the public health emergency is underway, Medicare is covering up to eight over-the-counter COVID-19 tests per member each month. Some providers are trying to design "subscription" services in which they mail eight tests every month whether the beneficiary needs them or not, Cohen said.
Indeed, the CareSet data shows a dramatic shift in spending for over-the-counter tests and away from PCR laboratory tests beginning in April.
And as investigators try to stay atop new scams, they're busy investigating the old ones.
"We are still finding entities that defrauded us of just enormous amounts of money," Cohen said.
New documents show that St. Jude Children's Research Hospital's reserves grew to $7.6 billion, as other children's cancer nonprofits struggled to raise cash.
This article was published on Wednesday, June 8, 2022 in ProPublica.
In July 2021, St. Jude Children's Research Hospital announced to fanfare that it had just finished raising $2 billion in donations, a single-fiscal-year record for the nation's largest healthcare charity. "Solving pediatric cancer is a global problem — a multi-trillion, multi-year problem," Rick Shadyac, chief executive of St. Jude's fundraising arm, told the Associated Press at the time. "The way we look at it is: If not St. Jude, then who?"
Financial disclosures newly released by St. Jude, however, show $886 million of the hospital's record $2 billion-plus in revenues last fiscal year went unspent. Those surplus dollars instead flowed to the hospital's reserve fund, which helped it grow to $7.6 billion by the end of June 2021. That's enough money to run St. Jude's 77-bed hospital in Memphis at last year's levels for the next five years without a single additional donation.
The impressive growth in fundraising raises new concerns about the amount of money that the charity has put aside for its rainy day fund.
Last year, ProPublica reported that St. Jude had accumulated billions of dollars while many families of young patients treated at the hospital struggled financially. Parents told ProPublica that they'd exhausted savings and retirement accounts and borrowed from family and friends, despite St. Jude's much-publicized pledge to alleviate many of the costs associated with treatment "because all a family should worry about is helping their child live." St. Jude said they provided generous benefits to families, but cannot cover all financial obligations that a family experiences during a child's illness. In response to the story, St. Jude significantly increased its benefits for families, including more support for travel and housing.
Some researchers, oncologists, healthcare advocates and families of patients complain that St. Jude's fundraising makes it more difficult for other pediatric hospitals to raise money for their operations. St. Jude competes for fundraising dollars directly against other children's hospitals, some of which have significant numbers of patients in clinical trials and their own research divisions focused on pediatric cancer care. To visualize just how much St. Jude outstrips its competitors: In 2020, U.S. News and World Report's ranked the nation's best children's cancer centers. St. Jude's, ranked tenth, pulled in more than the combined total of the nine hospitals ranked above it , according to financial records filed with the Internal Revenue Service.
"Donors all want to get the biggest bang for their buck," said Ge Bai, a professor of accounting and health policy at Johns Hopkins University. "It's time for St. Jude to respect donors' preferences and stop hoarding. Effectively and sufficiently spending money on the core mission is the only way to deserve donors' trust and sustain their generosity."
In a statement, St. Jude said the large reserve was a prudent cushion against swings in the stock market as well as the economic uncertainties created by global crises like the war in Ukraine. It said it expects the yearly cost of operating the hospital and making capital improvements to increase from a total of $2 billion in fiscal 2023 to $2.2 billion by fiscal 2026. At that point, according to the statement, contributions may not keep pace with spending and the hospital may need to tap the reserve fund. The hospital said it expects to spend a total of $12.9 billion over the six-year period beginning with fiscal 2022.
St. Jude said it cannot be fairly compared to any other hospital because its operating model relies disproportionately on public donations.
"Our reserves allow us now, and in the years ahead, to treat patients and continue research projects — no matter what happens to the economy or in the event of a disaster," the statement said.
St. Jude said it is also expanding its work internationally, including a plan to spend $200 million over five years to help thousands of children in the Middle East, Africa and other parts of the world receive free chemotherapy drugs. In recent months, the hospital has also helped pediatric cancer patients in Ukraine continue receiving care.
"Having a responsible reserve fund is critical to fueling this comprehensive, global strategic plan," St. Jude wrote.
The Better Business Bureau's Wise Giving Alliance, which sets standards for charitable spending, advises charities to avoid accumulating funds that could instead be used for current programs. It says a charity's unrestricted net assets available for use should not be more than three times the past year's expenses or the current year's budget. The alliance deducts assets like land and buildings from its calculations and combines the expenses of the hospital and its fundraising arm. The alliance calculation puts the reserve fund at 3.05 times higher than the current year budget of the hospital and ALSAC, which the charities provided to the alliance. Though St. Jude itself is slightly above the limit, the alliance said it remains in compliance.
St. Jude's fundraising arm, the American Lebanese Syrian Associated Charities, or ALSAC, spent $626 million in fiscal 2021, about 35% of the organization's total expenses, the financial disclosures show. That figure includes fundraising and educating the public about childhood cancers. St. Jude spent $1.2 billion on treatment for children with major illnesses, laboratories and clinical trials and hospital administration. St. Jude said its fundraising and marketing expenses were well within industry standards.
The record-breaking $2 billion in contributions to St. Jude represented a 16% increase over the previous year. St. Jude said that it benefited from investment gains in a hot stock market in addition to the increase in contributions in fiscal 2021.
One key driver of the boost in donations was bequests, in which donors name St. Jude as a beneficiary in their wills. Such donations increased 24% from the prior year to $478 million, or almost one in four dollars donated to St. Jude.
The bequest program, while one of the most successful in the country in terms of dollars raised, has also led to disputes with donors' family members and allegations the hospital is too aggressive in seeking monies from inheritances. St. Jude says that it operates with the highest ethical standards in carrying out donors' intents.
St. Baldrick's Foundation is one of the largest funders of childhood cancer research in the country. Its wide-ranging programs pay for clinical trials to test new treatments and provide training for new doctors and researchers entering the field.
The charity primarily raises money through events where people shave their heads to solicit contributions. When COVID-19 triggered quarantines in March 2020, St. Baldrick's had to cancel scores of events and lost millions of dollars in donations, said Kathleen Ruddy, the organization's chief executive.
In the fiscal year before the pandemic began, St. Baldrick's financial disclosures show it raised more than $36 million. Total donations last fiscal year, ending in June 2021, were about $18 million — a 49% drop. The charity had to close several research grant programs and lay off staff, Ruddy said.
People often ask if St. Baldrick's is part of St. Jude, Ruddy said, but in fact St. Jude applies for, and sometimes receives, research grants from St. Baldrick's.
St. Jude is one of a number of deserving charities serving kids with cancer, Ruddy said.
"We have funded about $9.3 million worth of research at St. Jude" since the foundation launched in 2004, Ruddy said. "But we've funded over $300 million at other hospitals. So it tells you that no institution has a monopoly on talent and innovation and ideas."
She said St. Baldrick's fundraising has begun to recover and the charity plans to restore one of its shuttered research grants next fiscal year.
Most Americans know St. Jude Children's Research Hospital through television advertisements featuring Hollywood celebrities asking for contributions or the millions of fundraising appeals that regularly arrive in mailboxes across the country.
But a select group of potential donors is targeted in a more intimate way. Representatives of the hospital's fundraising arm visit their homes; dine with them at local restaurants; send them personal notes and birthday cards; and schedule them for "love calls."
What makes these potential donors so special? They told St. Jude they were considering leaving the hospital a substantial amount in their wills. Once the suggestion was made, specialized fundraisers set a singular goal: build relationships with the donors to make sure the money flows to the hospital after their deaths.
The intense cultivation of these donors is part of a strategy that has helped St. Jude establish what may be the most successful charitable bequest program in the country. In the most recent five-year period of reported financial results, bequests constituted $1.5 billion, or 20%, of the $7.5 billion St. Jude raised in those years. That amount, both in terms of dollars and as a percentage of fundraising, far outpaces that raised by other leading children's hospitals and charities generally.
While a financial boon to St. Jude, the hospital's pursuit has led to fraught disputes with donors' family members and allegations that it goes too far in its quest for bequests.
St. Jude is a major research center with a 73-bed hospital in Memphis, Tennessee, that primarily treats kids from the Mid-South. Its bequest operation has a broad reach, with fundraisers based across the nation and a willingness to challenge families in court over the assets their loved ones leave behind. These battles can sometimes be lengthy and costly, spending donor money on litigation and diminishing inheritances. Family attorneys who specialize in such fights say that St. Jude can be especially aggressive, often pursuing cases all the way to state supreme courts.
"At the end of it, there is very little to hold on to feel good about," said Vance Lanier, of Lafayette, Louisiana, who won a yearslong legal battle with St. Jude over his father's estate but not before both sides spent heavily on the case.
"Think of all the fees for lawyers that didn't go to St. Jude, not one child, not one cancer patient," Lanier said. "Where is the sanity in all this?"
The nonprofit even courts those who aid in estate planning and drawing up wills, sponsoring conferences where attorneys, financial advisers and estate professionals gather. On at least one occasion it offered attendees a chance to win a golf trip.
The prospective donors wooed by St. Jude are often people like Nona Harris: elderly, childless women with substantial wealth. Harris notified the charity in 1996 that she was considering leaving it a bequest. St. Jude spent the next two decades cultivating Harris. An internal database, built to collect information on donors, tracked nearly 100 calls and other contacts between Harris and the charity's fundraisers during that time — an average of almost once every two months. It also noted information Harris shared with fundraisers.
By the time she died in 2015, the charity knew just about everything there was to know about her. It knew about the health problems of her husband, J.D., from the medicines that he took to the heart defibrillator that needed to be replaced. St. Jude knew that J.D.'s mother died when he was 13 and that one of Nona's relatives had a rare tongue cancer. It knew the couple owned a condominium in Tulsa, Oklahoma, and a ranch with cattle and horses in Kansas.
Most importantly, the charity knew the couple planned to leave their nearly $6 million estate to St. Jude. But Nona died before J.D., and after he changed his estate plan — reducing St. Jude's payout by about $2.5 million — the charity went to court, triggering an expensive, drawn-out legal battle that pitted the hospital against several of J.D.'s family members.
Estate matters can be contentious, and many nonprofit organizations, including ProPublica, seek donations in people's wills.
But St. Jude's pursuit of such donations stands out. Bequests to St. Jude, as a percentage of total contributions, are more than double the national average of 9% as calculated by Giving USA.
And it receives more than other children's hospitals that list bequest donations. Boston Children's Hospital reported that estate and trust donations ranged from 3% to 6.5% annually during the three-year period of 2014 through 2016. Donations from estates to Children's Hospital Colorado Foundation represents 3.5% of total giving at that hospital, according to its website. Nationwide Children's Hospital in Columbus, Ohio, said its bequest giving was aligned with national benchmarks such as the 9% figure from Giving USA.
For such organizations, any decision about waging legal fights with family members often comes down to a public relations decision.
"A legal fight could mar the reputation of a charity," said Elizabeth Carter, a law professor at Louisiana State University who specializes in estate planning. "A lot of charities decide it is just not worth it; we don't need that bad press. Occasionally you will see them fighting it, but not often because of the bad PR that comes from it."
In a statement issued through its fundraising arm, the American Lebanese Syrian Associated Charities, or ALSAC, St. Jude said its bequest program "operates with the highest ethical standards and with bequest program best practices like other large charities."
But it declined to answer specific questions about its bequest program, including how many cases are in litigation, or to respond in detail to questions about individual cases in which it has contested wills.
In 2017, Fred Jones, the ALSAC lawyer who oversees bequest matters, told an Oklahoma court that the charity was involved in more than 100 legal fights over disputed estates. Jones said many of those involved other parties challenging an estate in which St. Jude had an interest, but that it did pursue legal action on its own in some cases. Jones said St. Jude received about 2,000 new bequests in the fiscal year ending June 30, 2017. In a statement, ALSAC said it litigates less than less than 1% of the thousands of estate donations that it receives.
Jones told the court that neither St. Jude nor ALSAC "is in the business of trying cases," in part because such efforts are funded with donations for the treatment of sick children. As a result, Jones said, St. Jude only initiates cases in which due diligence reveals substantial evidence to support a claim. "In effect, we're using donor dollars — which we very carefully protect — in those cases where we believe that there has been a curtailment of the donor's actual intent," he said. Jones did not respond to a request for comment. St. Jude declined to provide further details on the use of donor funds to pay legal costs. In some jurisdictions, courts allow winning parties in a case to seek legal fees from the losing side and legal costs are sometimes reimbursed as part of settlement agreements.
To make the case that estate proceeds should go to St. Jude, the charity sometimes argues that relatives are not entitled to any proceeds from their family's estates.
"Where I think the line is crossed is when they promote the disinheritance of children or families," said Cary Colt Payne, a Las Vegas attorney representing a son who is battling St. Jude over his father's estate.
In its statement, ALSAC said ProPublica's reporting on bequests was "highly selective and flawed as it focused on a small handful of contested cases over several years out of the many types of these donations received each year. These contested estate matters often cover complex and sensitive family matters, include multiple charities, and involve local lawyers advising ALSAC/St. Jude."
St. Jude's responsibility, according to the statement, is "to carry out the clear written intent of a donor, typically stated in a written will or trust drafted by an independent lawyer, most often witnessed and notarized. These are beautiful legacy gifts with enduring impact, enabling us to remain focused on our mission: Finding cures. Saving children."
"Love Calls"
St. Jude, founded by the entertainer Danny Thomas, makes a unique promise as part of its fundraising: "Families never receive a bill from St. Jude for treatment, travel, housing or food — because all a family should worry about is helping their child live."
That pledge, and the ubiquitous appeals for donations that accompany it, has helped St. Jude become the country's largest healthcare charity. Recent years have seen record-breaking fundraising gains. The hospital raises so much money that between 2016 and 2020, it annually steered an average of $400 million into a growing reserve fund that totaled $5.2 billion as of June 30, 2020 — the most recent figures publicly available.
To raise money, St. Jude depends on the related nonprofit ALSAC, which conducts the hospital's fundraising and awareness campaigns.
ALSAC's interactions with Nona Harris provide a window into the techniques used by the charity to encourage bequests and cultivate those who express an interest in making them.
In January 1996, Nona called St. Jude to let the hospital know she was considering making a large bequest, which at that time she said could be up to $500,000.
Phone calls from potential donors like Harris are just one of the ways ALSAC learns of potential bequests. Other times, the hospital is alerted by a financial planner or estate lawyer of plans by clients to leave money to St. Jude. Most times, proceeds from bequests just show up with no prior notice after a person has died. The charity also solicits them in fundraising materials, encouraging anyone open to considering St. Jude in their will to notify it using an enclosed information card and envelope.
Harris, after notifying St. Jude of the potential bequest, then asked that no one contact her. That request was apparently ignored as an ALSAC staffer was tasked with getting in touch with Nona a few months after her call, according to a printout of a computerized log of interactions with Nona filed in court.
ALSAC bequest specialists maintain a "portfolio" of estate donors who are ranked by importance, according to current and former ALSAC employees. The size and range of the ALSAC bequest operation gives it the advantage of being able to meet in person with donors anywhere in the country.
ALSAC sent Nona handwritten birthday and holiday cards, and in one case, just a note to say, "I thought of you today." The cards were often followed by phone calls around the holidays to check in with her.
On four occasions — in 2000, twice in 2001 and in 2005 — Nona was listed for what were described in the log as "love calls." St. Jude declined to provide details on what such calls entailed.
The ALSAC staff invited the Harrises to special events, including a 50th anniversary gala party in Los Angeles, as well as asking them repeatedly to come to Memphis and visit the hospital. "I will be sure to be at the front door waiting for your arrival," a staffer wrote in 2007. Family members do not believe the Harrises ever visited.
One hint in the notes of why Nona chose St. Jude as a beneficiary of her estate was a comment she made in 2004 that she "was thrilled to do it since St. Jude is her patron saint." Although the hospital is named after the saint, it does not have any religious affiliations. J.D. also had a fondness for the children's hospital, according to family members, and would occasionally wear a St. Jude baseball cap sent to the couple by fundraisers.
The Harrises were different from other large bequest donors in one significant way. It doesn't appear anyone from ALSAC ever visited them at their home.
Former ALSAC employees who worked on bequests said they would visit some donors dozens of times. They said some of those were older donors who were lonely and enjoyed the companionship. Internally, the jobs came to be known as "the tea and cookie positions" since that's what many visits to donors involved. One staffer said he became so close to one donor that he attended holiday dinners at the family's home.
An ALSAC employee based in Rhode Island said she would meet in person with 150 to 200 people a year throughout New England and upstate New York who indicated they planned to leave money to St. Jude or were considering it, according to testimony she gave in 2015 in a New Hampshire estate dispute.
The employee, Maureen Mallon, was an estate lawyer in private practice for 20 years before joining ALSAC as a philanthropic adviser in 2010.
"Part of my role is to connect them, to build a relationship with them, to give them more information about the hospital," she said of visiting potential donors.
Mallon testified about her relationship with one donor, whom she visited at her home in person five times, usually for an hour or more. The woman — who was elderly, widowed and did not have children — would have lunch ready for the two of them and always sent Mallon home with baked goods. One time she called to make sure Mallon made it home safely. Mallon said the woman discussed details of her estate and shared family histories and relationships. She confided that certain relatives would be unhappy if they learned she planned to leave her home to the Memphis hospital. The visits and notes about what was discussed were recorded in a database, according to the testimony. Attempts to contact Mallon were unsuccessful.
The Harrises were private people who had retired to their ranch in Kansas following years of traveling the world as part of J.D.'s work in the oil industry. They used their Tulsa condo when they came for medical care in the city.
On the ranch, J.D. would rise early each day to drive the foreman around the 320-acre property to feed the scores of cattle and horses. He typically dressed in blue jeans, black cowboy boots with his initials on them, a cowboy hat and a white oxford shirt with two pockets that he used to carry a small notebook, a pencil and his checkbook.
J.D. was plainspoken and frank, friends recalled, while Nona was described as a generous person who was always impeccably dressed.
After Nona died on the day after Thanksgiving in 2015, J.D. became closer with his remaining family members, including two nieces and a nephew, according to court testimony.
J.D. was particularly fond of his great-nephew Brent Neitzke, who lived in Indiana and visited him at the ranch on a regular basis after Nona's death. Most Sunday nights, J.D. and Neitzke would talk for hours on the phone. Neitzke said they discussed politicians, happenings in the world and J.D.'s travels. He said J.D. also talked about his estate and his plans to split it.
J.D. told his accountant that the estate plan he formed after Nona's death was something of a compromise. He would still be honoring Nona's wish to help St. Jude while at the same time taking care of his family.
When J.D. called ALSAC two months after Nona died to share the news that his wife had passed away, he told the staffer who was the main contact for Nona that he wanted "to talk to me at length about his codicile (sic) to their will," according to court records. A codicil modifies or revokes parts of a will.
Later, the ALSAC staffer tried to set up a meeting with J.D. at his home, but J.D. said that it was too soon for a visit and that he wanted to speak to his attorney first, according to notes of the conversation recorded by ALSAC.
For ALSAC, the next step was the courtroom.
Court Battles
That's where Vance Lanier found himself when St. Jude fought him over the distribution of his father's estate.
Lanier is a financial planner in Lafayette, Louisiana, who helps clients with estate and trust matters. His father, Eugene, died in December 2015. His will directed that $100,000 from the proceeds of the sale of his home go to St. Jude.
But there was a problem. The elder Lanier did not own his home, according to his son. More than a decade earlier he had placed it in a trust, along with other assets, to benefit his three children.
To Lanier, it was a simple matter. St. Jude was not entitled to any money from the house sale. "He had given away his assets to put into a trust," Lanier said. "My dad did not own it. He could have changed that while he was alive, but he didn't."
Still, recognizing that his father did want to make a donation to St. Jude, and hoping to avoid spending money on legal fees, Lanier said he offered St. Jude $25,000 to settle the matter. The offer was rejected, according to Lanier and his attorney, and St. Jude instead pursued the matter in a yearslong court fight. St. Jude argued that the elder Lanier, through his will, "clearly directed the sale" of the property and that $100,000 of the proceeds should go to the hospital.
A trial court ruled in favor of Vance Lanier. St. Jude appealed that ruling but eventually lost. The charity then asked the state Supreme Court to reverse that ruling, but the request was denied, ending the matter.
Lanier said the legal dispute was expensive for both sides. He spent $50,000 in lawyer fees. Even if St. Jude had won the case, he said, much of the money it would have received from the elder Lanier's estate would have been wiped out by legal costs. St. Jude did not respond to questions about how much it paid its lawyers.
Lanier said he wrote to the chief executive of St. Jude complaining that the legal fight was a waste of time and the charity's resources.
Before the estate dispute, Lanier said he and other members of his extended family were supporters of St. Jude and had collectively donated thousands of dollars to the Memphis hospital. That is no longer the case, he said.
"After this and seeing the waste, I don't want anything to do with them," he said.
Influence and Attorneys
One sign of the significance of bequests to St. Jude is that it frequently underwrites conferences for estate lawyers and financial planners, who can help clients determine which charities to leave money to in their wills.
In some cases, it is the only charity involved. Typical sponsors are mostly banks, trust companies and consultancies.
St. Jude has been a top-level diamond sponsor for the past several years of the Heckerling Institute on Estate Planning, an annual conference that typically draws more than 3,000 attendees.
The $30,000 cost of a diamond sponsorship allows St. Jude to bring as many as 10 employees to work at its deluxe suite on the exhibit hall floor. St. Jude also gets a list of all attendees and their emails and expanded networking times with conferencegoers.
At the 2017 conference, St. Jude raffled off a free trip to attend a PGA Tour golf event in Memphis.
The winner, estate and tax adviser Jack Meola, of New Jersey, said that in addition to attending the golf event, he and his wife were taken on a tour of St. Jude. "It's a very emotional experience," he said.
At the Heckerling conference the next year, ALSAC asked him to give a luncheon talk to attendees about St. Jude, Meola said.
He said he shares his experience of visiting the hospital with his clients when they are considering charities as beneficiaries.
"I always talk to clients and give them the example," Meola said. "They may not end up choosing St. Jude, but I give them the emotional side."
St. Jude's relationship with a Las Vegas estate lawyer ensured it learned about a lucrative estate case in time to fight for the bequest all the way to the state Supreme Court, and it raised ethical questions about whether the lawyer had been fully transparent with her client.
The lawyer, Kristin Tyler, drafted a will in October 2012 for Theodore Scheide Jr. that directed his estate go to St. Jude. But after Scheide died in 2014, the original of that will could not be located. A guardian who served as the administrator of Scheide's estate concluded that he destroyed it, rendering it null and void, and determined his money should go to his son.
In 2016, just as a court was on the verge of finalizing the passing of Scheide's $2.6 million estate to his son, Tyler learned of the plans for the money and alerted Jones, the ALSAC attorney. Tyler knew to call Jones because in addition to Scheide she had another client: St. Jude.
Tyler was vague about what prompted her to look into the matter at the last minute, writing in one email at the time that "for some reason I recently thought about Theo Scheide." She was certain, however, that the money should go to St. Jude and not Scheide's son. The two were estranged and Tyler said Scheide was adamant about disinheriting his son.
After calling Jones, Tyler then contacted a partner at a prominent Las Vegas law firm that worked with the charity. In an email, she advised the partner that St. Jude would be reaching out to him and "you need to jump on this quick." She offered to help, writing, "I want to make sure this estate goes 100% to St. Jude and not to Theo's estranged son." She wrote that it would be "a shame" for the money to go to the son.
Tyler later testified that she had represented the hospital in at least two, and perhaps three, estate matters. She testified that she was unsure if she was working for St. Jude at the same time she helped Scheide draft his will. In any event, she said that it wouldn't have been necessary to tell Scheide about her work for St. Jude because the interests of the two parties were not opposed to each other — meaning there was no conflict of interest. St. Jude did not respond to questions about its relationship with Tyler.
Legal experts said the need to disclose the relationship with St. Jude would depend on the nature and extent of Tyler's dealings with the charity. Tyler declined to comment.
A district court judge, after a hearing, ruled that the estate should go to the son as there were not two independent witnesses who could vouch for the existence and substance of the missing original will. St. Jude appealed that decision to the state Supreme Court, which overturned the lower court in 2020 and ruled in favor of the charity. Appeals in the case continue.
Key to the supreme court ruling were affidavits from Tyler and her assistant testifying to the legitimacy of the missing will, saying that they witnessed Scheide sign it and that, to their knowledge, he had not intentionally destroyed or revoked it.
For Scheide's son, Chip, the most painful part of the legal fight with St. Jude was not potentially losing out on his father's estate but the way he was characterized by the charity and years of uncertainty over the potential inheritance. In appealing the case to the state Supreme Court, St. Jude repeatedly referred to Chip as a "disinherited" son and claimed his father had "no interest" in contacting him. He called it "intentionally hurtful."
Chip acknowledges an estrangement from his father but says it was not rooted in anger or a dispute. Instead, Chip said, it was the result of a decision his father made in the wake of his parents' divorce to remarry and move from Pittsburgh to Florida when Chip was 11 or 12. After he moved away, Chip only saw his father a few times.
"He made a choice," Chip said of his father and the distant relationship between the two. Still, he said, the two stayed in touch. They regularly exchanged holiday cards and just a year before he died, Theodore sent Chip a congratulatory card and a check when he married for a second time.
Chip was in Las Vegas about a year before his father died and tried to contact him, without success. Later he learned his father was in the hospital at that time.
Despite the contention of St. Jude that Theodore did not want to contact Chip, Diane Prosser, a case manager for the guardianship service that managed Theodore's affairs, said in an interview with ProPublica that Theodore talked frequently about his son toward the end of his life.
"I know towards the end, he mentioned his son a lot," Prosser said. "I remember saying, should we be looking for his son?" Prosser said she discussed the matter with her boss but doesn't remember any effort by the guardianship service to find Chip before Theodore died on Aug. 17, 2014.
"He Knew Exactly What He Wanted to Do"
J.D. Harris was admitted to the hospital for a heart valve procedure on Dec. 15, 2016, a little over a year after his wife died. During the operation, his kidneys failed, according to court testimony. Doctors told J.D. that if he didn't begin dialysis he would die within days. J.D., who was 92, told the doctors he wasn't interested in the treatment.
By this point, J.D. had not yet made the changes to his estate that he talked about during the previous months. On Dec. 19, he called his longtime accountant, Dwight Kealiher, from the hospital and told him he wanted to rework his trust and will.
Attorney Jerry Zimmerman, a well-known Tulsa estate lawyer, met twice with J.D. at the hospital on Dec. 21. Zimmerman questioned J.D. to make sure he was competent, asking him personal questions and inquiring about his assets. He said in court testimony that J.D. was lucid and accurately recalled details of his estate and his existing trust.
Zimmerman said J.D. told him he wanted to change his estate plan to split it between St. Jude and four family members, including Neitzke. J.D. also wanted $100,000 to go to Jim Tibbets, the foreman of his ranch, whom he considered a friend, Zimmerman testified.
Zimmerman returned to the hospital the next day with the reworked estate documents, but J.D. said he wanted Kealiher to be there to review them and didn't sign. A day later, on Dec. 23, Zimmerman came back with Kealiher, who had just been released from a different hospital.
J.D., however, was in no condition to sign, according to his medical records. A hospital notary said he was "laboring" and might be confused. A nurse, concerned that J.D. was too weak to sign and incoherent, eventually asked everyone to leave the room.
Tibbets slept in J.D.'s room that night and said that J.D. woke up several times asking about the estate documents and requesting that Zimmerman come to the hospital so he could sign them. Tibbets explained it was the middle of the night and that wasn't possible, court records show.
The next day was Christmas Eve and Zimmerman was not available to come to the hospital, court records show. He gave the papers to be signed to Tibbets. Overnight, Tibbets said J.D. again woke up and asked about the estate documents as well as inquiring about the animals on his ranch.
"He was adamant about it," Tibbets said in an interview of J.D.'s desire to finalize his estate plans. "His mind was still sharp right until he passed away."
Tibbets said he put a piece of cardboard underneath the papers and that J.D. meticulously signed each letter of his name, understanding the importance of the moment. When he finished, he told Tibbets he was "glad" it was done. He died later on Christmas Day.
Six months later, St. Jude began the court fight seeking to overturn a district court finding that the restated trust was properly executed and requesting a new trial on the matter.
The hospital said that it didn't receive proper notice of the nature of the district court hearing on J.D.'s estate and that it was unfairly denied a chance to introduce medical records showing that J.D. was often incoherent, comatose or otherwise incapable of decision-making at the times he was asked to sign the reworked estate plan. The charity did not contest that J.D. signed the documents.
"He talked to his lawyer. He talked to his accountant. He talked to his family. He talked to his ranch hand, who was family to him," Tulsa District Court Judge Kurt G. Glassco said in a ruling, which found that J.D.'s reworked estate plan was valid. "And he knew exactly what he wanted to do."
After Glassco denied St. Jude's request for a new trial, the charity then appealed to the state Supreme Court, which delegated the matter to the Court of Civil Appeals.
As the case dragged on, J.D.'s nephew Doug Holmes, who was one of the family members named as a beneficiary in the restated trust, wrote a letter to the St. Jude board of directors.
"The continued unfounded litigation has caused significant pain to family members, as we repeatedly have to relive the final days of our dear uncle," he wrote in December 2018. "With each of St. Jude's legal filings, the attorney fees increase, sapping precious dollars that could go to St. Jude families."
In December 2019, the appeals court upheld the lower court ruling. In 2020, more than three years after J.D.'s death, his family members finally received their shares of his nearly $6 million estate.
Neitzke said his family remains mystified as to why St. Jude challenged the distribution of J.D.'s trust. The charity was still being granted a generous, multimillion-dollar bequest and J.D. even told the charity to expect a change from what Nona had promised before she died, he said.
Neitzke said he had been a supporter of St. Jude, but the litigation had changed his view.
"I thought this was a waste of time and money," he said. "I will never give them another dime."
The day after his inauguration, President Joe Biden signed an order creating a Pandemic Testing Board, which he said would be modeled on FDR's hugely successful Wartime Production Board. A year later, there's little sign of Biden's initiative.
This article was published on Wednesday, February 16, 2022 in ProPublica.
When President Joe Biden was campaigning for office, he said that to beat the coronavirus, the U.S. needed the testing equivalent of President Franklin D. Roosevelt's War Production Board.
"It's how we produced tanks, planes, uniforms, and supplies in record time," the Biden campaign website said. "And it's how we can produce and distribute tens of millions of tests."
A year later, though, it's remarkably hard to tell what the board has done.
As far as we can find, the group has put out no press releases, held no hearings and made no announcements. Biden's executive order states that the head of the board would be, or be chosen by, the White House's head of COVID-19 response. That's Jeffrey Zients, but when we contacted him, he didn't respond.
When we asked White House officials about the Pandemic Testing Board — who was on it and what actions it had taken — they declined to answer our questions and pointed us to the Department of Health and Human Services.
That agency did respond to our inquiries about the board, but its answers offered few details about the board's work. It did not say who is on the panel or what decisions it has made.
"The Pandemic Testing Board serves as the forum where agencies across the federal government which are involved in testing can describe emerging challenges and what they are learning," the agency said. "It provides a mechanism for addressing policy and implementation issues regarding the supply and distribution of tests, as well as increasing access to and affordability of tests in the community."
The agency's full statement also notes that the board has met regularly and has been split into two groups, one focused on test supply and the other on testing policies.
Public health experts told us they, too, hadn't heard much about the board.
"I had assumed that they jettisoned these plans," said Jennifer Nuzzo, an epidemiologist and professor at Johns Hopkins University. "If it still exists, it is certainly very low profile," said Lawrence Gostin, a professor of global health law at Georgetown University. The country's first coronavirus testing czar, Adm. Brett Giroir, said he knew little about it as well. "It is rumored to have met, but I did not see public disclosure or reports from the meetings."
Of course, the inner workings of a board are less important than whether the government is getting the job done. But as ProPublica detailed in November, the Biden administration has been slow to roll out wider testing — just what the board was created to do.
In October, White House officials reportedly disregarded a proposal from testing experts to send rapid tests directly to Americans in anticipation of a COVID-19 spike during the holidays. Press secretary Jen Psaki also infamously dismissed the idea in a December briefing.
Later that month, the Biden administration announced it would send tests directly to Americans. But the tests are arriving just as the omicron wave is receding, and critics have argued that the effort shortchanges communities of color.
"I think it's damn well about time," said David Paltiel, a professor of public health at Yale University. "It's never too late, but some of us have been screaming and yelling about the idea for more than 18 months."
There was no shortage of money for expanding testing. As part of last year's stimulus package, Congress appropriated nearly $48 billion for testing, contact tracing and other efforts to prevent the spread of COVID-19. That is in addition to $48 billion set aside for testing in 2020.
But just like with the board's activities, details about where exactly the money has gone have been hard to come by. Since the Biden administration hadn't released a breakdown, we submitted a request for specifics more than two months ago.
The allocations thus far include: $10 billion for testing in schools, $9 billion for manufacturing testing supplies, nearly $5 billion for testing uninsured individuals, and more than $4 billion for testing and mitigation measures for high-risk populations. Nearly $3.9 billion went toward free community testing at pharmacies and federally qualified health centers, and $2.9 billion went to the Centers for Disease Control and Prevention for expanding labs and testing capacity. More than $1.9 billion has gone toward COVID-19 testing of unaccompanied minors at the U.S.-Mexico border. About $3.6 billion is listed as simply "activities previously planned for PPPHCEA," a reference to the 2020 Paycheck Protection Program and Healthcare Enhancement Act. The Indian Health Service received an additional $1.5 billion. Another $4.4 billion is still pending allocation.
Mara Aspinall, an Arizona State University professor and an adviser to the Rockefeller Foundation on the subject of COVID-19 testing, has been tracking HHS press releases to figure out how the stimulus funds have been spent, since the numbers are not publicly disclosed. She said testing should have been more of a focus since the beginning of the pandemic, but there's still plenty left to do.
"There are a lot of indications that the federal government and state governments are understanding the power of the information that tests bring," she said. "But what we can't repeat is the error of last spring thinking it was over and therefore not continuing to focus."
Living organ donors are never supposed to be billed for transplant-related care. NorthStar Anesthesia charged one donor over $13,000 and nearly sent his bill to collections.
This article was published on Friday, February 11, 2022 by ProPublica.
The email arrived in Elliot Malin's inbox from his cousin's mom.
"Scott needs a kidney," the subject line read.
The message matter-of-factly described Scott's situation: At 28 years old, Scott Kline was in end-stage renal failure. He wasn't on dialysis yet. But he probably should have been.
His mom was reaching out to as many people as she could, asking them to be screened as a potential donation match.
"Thank you for considering it, but please don't feel any pressure to do it," she wrote. "Sorry I have to share this burden, but the best potential match is family."
Malin didn't need to be pressured. For him, the decision was easy.
"There was no other thought besides trying to help Scott," Malin later said.
He clicked on a link in the email to begin the screening process.
If he turned out to be a match, Malin knew the surgery could put his health at risk. The recovery would be physically painful. What he didn't anticipate was that it would put his finances in jeopardy. That just as he would have to trust the skilled hands of the surgeon to make sure the operation went well, he'd have to trust in the expertise of billing coders and financial coordinators to navigate the increasingly complex system that covers the costs of transplant surgeries.
Living organ donors are never supposed to receive a bill for care related to a transplant surgery. The recipient's insurance covers all of those costs. This rule is key to a system built on encouraging such a selfless act. And for most uninsured patients in end-stage kidney failure, Medicare would pick up the tab. But in Malin's case, he would end up facing a $13,000 billing mistake and the threat of having his bill sent to collections.
Donors like Malin play a critical role in the nation's transplant system. According to data from the United Network for Organ Sharing, in the last three years more than 30% of kidney donations came from living donors. Neither UNOS nor other national advocacy organizations track how often billing problems like those encountered by Malin occur. But advocates say they do happen and can deter donors from coming forward.
"Living donors should not be receiving any bills at all whatsoever regarding any part of the living donation process," said Morgan Reid, director of transplant policy and strategy for the National Kidney Foundation.
Malin and Kline describe themselves as cousins, but their blood relationship is distant. Their great-grandfathers were brothers, making them third cousins. Still, they're the same age and grew up as friends, sometimes traveling and spending holidays together. Kline attended Malin's wedding in 2019.
Exactly what went wrong with Kline's kidneys is a mystery. In the summer of 2020 he had just moved to Fort Worth, Texas, for work. He went in for routine blood work to monitor a medication he was taking. When the results came in, the doctor called to ask if he was on dialysis.
"You're in end-stage renal failure," the doctor told him.
"Oh, no I'm not," Kline responded.
The bloodwork wasn't wrong. He had just 17% kidney function. Thus began his search for a new organ. Kline was told his wait for a kidney could be three to five years if a friend or family member didn't step forward. In February 2021, Kline and his family began reaching out to everyone they knew. Volunteers signed up for medical screening, but insurance would only pay to test one at a time. Waiting for one potential donor to be ruled out before testing another drew out an already lengthy process.
Four months after Malin signed up to be screened, he got final confirmation he was a match.
By June, the two cousins were deep in the byzantine organ transplant bureaucracy: screeners, financial counselors, doctors, specialists, laboratories and, the most difficult, insurance companies.
"The amount of hoops you have to jump through to do this is pretty extraordinary," Malin said, describing rounds of medical tests, mountains of paperwork and preauthorizations for procedures. A multidisciplinary team of professionals assembled to assist the two patients through the process.
"The hospital was amazing on trying to make everything as easy as possible," he said of the team.
Malin said they gave him one assurance: He wouldn't have to contend with any bills or be responsible for a dime of the surgery's estimated $160,000 cost. The team had received preauthorization from Kline's insurance plan, which would pick up all of Malin's medical costs.
That assurance, however well-intentioned, fell flat.
In July, Malin traveled from his home in Reno, Nevada, to Fort Worth, where the cousins underwent the transplant surgery at Baylor Scott & White All Saints Medical Center. The surgery was successful.
Malin spent three days in the hospital recovering, Kline a day or two longer — a painful experience made bearable by their companionship.
"We would do our little walks around the hospital floor," Kline said. "We would be suffering together. It was really nice to have that. Usually you're there alone, especially during COVID."
By early August, Malin was back in Reno to finish recuperating. The next week, he started law school. Life was getting back to normal.
When the first bill arrived, it was more annoying than stressful. It totalled just $19.15 for blood work done before the surgery. The hospital said it would take care of it, Malin said. Then he got a notice that an old insurance plan he was no longer a member of had been billed $934 for lab work. Again, he notified the hospital.
In late September, Malin got a bill for a stomach-dropping amount: $13,064. While he was startled by the cost, it didn't worry him too much. He knew Kline's insurance was responsible for paying it. He notified the hospital and forgot about it.
A month later, a second notice arrived. Then, on Dec. 6, Malin received a document that scared him.
"Final Notice! Your account is now considered delinquent," the notice read. If he didn't take action, the billing company warned, it would attempt "further collection activity."
The bill was from NorthStar Anesthesia, a firm that provides anesthesia services to hospitals across the country, including Baylor Scott & White All Saints.
Now, Malin wasn't only irritated that the bills just kept coming, he was worried about his credit.
"I did call them and kind of chewed them out a little bit," Malin said. "I walked through what this was for, that it was a kidney donation and I'm not the responsible party."
Malin complained on Twitter about the aggressive billing practice, eliciting an array of responses, from jokes about asking for his kidney back to outrage that he'd be in this position after such a gift.
After he called the billing company and the hospital, there was nothing else he could do.
"I'm just waiting to see if I go to collections or not," Malin told ProPublica two weeks later.
He did his best to leave Kline out of it entirely.
"He's had a lot on his plate," Malin said of his cousin. "His recovery has been harder than mine. He's the one accepting the organ, so he'll be on immunosuppressants the rest of his life. Because of COVID, he's largely stuck indoors. I don't tell him a lot of it. I don't want to stress him out."
Still, it troubled Kline that Malin was facing such problems.
"At the end of the day, I want everything to go as smoothly as possible for Elliot," Kline said. "He was doing me an unbelievable kindness. I owe my life to him."
A stack of bills for Malin's transplant surgery Credit: Andri Tambunan, special to ProPublica
Malin heard nothing until Jan. 19, one day after ProPublica reached out to NorthStar for comment.
"The CFO of NorthStar just called me and told me she's taken care of the bill," Malin texted a reporter.
The next day, the company emailed Malin, confirming he would not be responsible for the bill, that he was never sent to collections and that his credit wouldn't be affected.
"On behalf of NorthStar, I apologize for causing any confusion or concern for you regarding this matter and assure you that it has been resolved," wrote Kate Stets, the company's chief financial officer.
Fact-based, independent journalism is needed now more than ever.
She said that after his call on Dec. 7, the bill had been rerouted to "the correct parties," but that the company had failed to communicate that to him. The letter explained that NorthStar had received incorrect insurance information at the time of the surgery. (A spokesperson later said NorthStar received no insurance information at the time of the surgery.) In such cases, bills are automatically sent to the patient.
The company has since adjusted its policy to prevent that from happening in future transplant cases, Stets wrote.
"To be clear, it is not NorthStar's policy to bill transplant donors for bills related to their donation surgeries," Stets wrote. "We recognize the well-established public policy standard and practice that transplant donors should not be billed for such services — that we and the nation's healthcare system have a responsibility to foster and encourage such acts of selflessness and generosity."
In a statement, a NorthStar spokesperson said no other organ donors owe "out of pocket payments."
"NorthStar did not hear from Baylor on this matter previously and was first notified of the billing error on December 7, 2021 after insurance information was not provided to NorthStar by the transplant center at the point of care," a spokesperson said. "NorthStar resolved the error immediately and closed the account that same day, prior to any inquiry from ProPublica."
Both Malin and Kline commended the team at Baylor Scott & White All Saints that guided them through the process. The hospital, however, declined to grant an interview to ProPublica about what went wrong with the billing.
A spokesperson provided a short statement: "We are pleased this has been resolved for our patient by NorthStar. Although billing can be complicated, these occurrences are rare. We have also been in touch with the patient and we don't have anything further to report."
Financing such surgeries is so complex that transplant centers employ coordinators to help both patients with the process.
"I tell donors, I can't guarantee you won't get a bill, but if you do, call me," said Deidra Simano, president of the Transplant Financial Coordinators Association.
In one case, after trying everything to get a provider to bill the proper insurance, Simano resorted to paying a patient's $200 bill with the transplant center's credit card.
"That's what we had to do to make it go away," she said.
Malin said he feels fortunate to be equipped to fight the billing issues. He worries about others with fewer means facing a similar situation, recognizing it could be a barrier to those selfless enough to donate an organ.
"It sucks but I wouldn't have changed any of it," he said. "I like my cousin. I want him to be healthy."
A salmonella outbreak sickened more than 60 people at a funeral reception in Texas. Two years later, some of them are still coping with the financial and medical consequences.
This article was published on Wednesday, January 19, 2022 in ProPublica.
On a cloudy day in November 2019, family and friends gathered in Austin, Texas, to mourn the passing of Lovey Jean Carter.
Carter, who had heart trouble and other ailments, had died at 67.
After the burial, many of the mourners returned to Rising Star Baptist Church to share a meal. The brisket was home cooked, but everything else — rotisserie chicken, potato salad and fried chicken — was bought ready to eat from local grocery stores. One of Carter's brothers, James Monroe, had picked up 15 rotisserie chickens ordered from the Sam's Club on the south end of Austin. It was all simple. And it was all supposed to be safe.
But that night dozens of the attendees were stricken by illness, overcome by nausea, cramping, vomiting and diarrhea, according to an investigation by Austin Public Health, which found that at least 61 people reported symptoms of food poisoning after the reception.
"Seemed like a dream that everyone was calling saying, 'I'm sick, I'm sick, I'm going to the hospital,'" Joyce McDowell, one of Carter's younger sisters, recalled.
Hundreds of people die every year in the United States after eating food tainted with salmonella, listeria and other dangerous pathogens. As wrenching as those deaths are, though, they are only the tip of the toll that food poisoning takes on the United States, where millions more people are sickened each year.
Salmonella is a leading culprit, with an estimated 1.35 million infections a year, resulting in thousands of hospitalizations, according to the Centers for Disease Control and Prevention.
For many of those victims, the effects can be life-altering. There can be kidney or gastrointestinal troubles that persist for years. There can be staggering hospital bills that for some patients, especially those without health insurance, seem to never let up.
And long after the worst of the illness has passed, anxiety about eating and the frustrating, often futile, search for answers can linger.
The rate of illnesses caused by salmonella hasn't lessened in 25 years in the U.S., which continues to lag many countries in curbing the spread of the pathogen.
A ProPublica investigation of the U.S. food safety system found that federal regulators don't have the power to stop meat and poultry contaminated with risky strains of salmonella from being sold to consumers. When the U.S. Department of Agriculture, which oversees meat and poultry, detects the pathogen, the agency can't issue recalls or halt plant operations. It can only act if it is able to tie a case or cluster of cases of foodborne illness to a particular product. Inhibiting oversight further, a total of 15 federal agencies have a hand in food safety, with much of the responsibility split between the USDA and the Food and Drug Administration, a fragmented structure that critics say has impeded progress.
Nationally, the price tag in costs of treatment, lost work hours and premature deaths is estimated at $4.1 billion a year, according to the USDA.
"Salmonella is a very expensive pathogen, partially because it causes a lot of illnesses and partially because it can cause pretty severe disease as well," said Sandra Hoffmann, a senior economist at the USDA. "You think, 'Oh, foodborne illness is just a bellyache,' but it is quite costly."
The experience of Carter's loved ones would end up a testament to the toll salmonella can take and to the obstacles to holding anyone accountable when illness strikes.
Austin Public Health opened an investigation into the outbreak shortly after it began, but investigators couldn't pinpoint the source of the illness — a fate that befalls most such inquiries.
McDowell, now 68, hoped to fight through her illness at home. But the next day, she still felt sick. And that night, her watch sounded off with warnings that her heart rate had reached 130 beats per minute.
"I never felt so weak like that in my life," she said.
By the time she arrived at Dell Seton Medical Center in Austin, others from the funeral were already at area hospitals. Before long, doctors had identified the source of the spate of illnesses as salmonella.
"You hear it advertised on the TV that so many people die a year of salmonella," McDowell said, "but you never think that it'll hit home. But it did."
After the result of lab tests came back, Austin Public Health was notified on Nov. 5, three days after Carter's funeral.
The health agency would eventually identify 84 people who attended the funeral reception. At least 26 of them were hospitalized, some for more than a week. The youngest person hospitalized was 1, the oldest 92. Servers who tasted the food also ended up sick.
The health agency interviewed 67 of 84 funeral attendees, asking each of them to recall what they had eaten, when they started feeling ill and what the symptoms were. The agency found that the rotisserie chicken was eaten by more of the sick people than any of the other foods served.
But as clear as the cause might have seemed to the victims, determining that the chicken was in fact the source of the salmonella outbreak still wasn't going to be easy. One reason was that so many of the mourners fell ill. Only two of the people who were identified as having eaten at the funeral didn't get sick, which left investigators unable to effectively distinguish between what the sick people ate and what the healthy people ate.
"It's plausible that the chicken was the cause of the illness," Jen Samp, a spokesperson for Austin Public Health, said in an email, "however, we did not have statistical evidence to prove which food was the culprit."
A spokesperson for Sam's Club, Erin Hulliberger, told ProPublica in an email that the company is "committed to providing high-quality products" and noted that the Austin investigators had said they were unable to determine the source of the illness.
The possibility of cross-contamination presented another investigative challenge. The brisket and chicken had been served with the same utensils, so if salmonella was originally present on one but not the other, the bacteria could have spread between them.
Monroe, who had picked up the rotisserie chickens and cut them up before the reception, was among those who ended up sick. He and his son sampled a few bites while prepping the food, and by the time the service was over, he was in such pain that he went home instead of going to the reception. It wasn't until that night, as he heard of others who had become ill, that he realized that the rotisserie chicken might be the cause of all the sickness.
A little over a week later, after he had recovered, Monroe gave the health agency what seemed like a valuable clue: a whole rotisserie chicken that was one of the 15 purchased for the funeral reception but had been sitting, unopened, in Monroe's refrigerator.
For investigators, an unopened package of a suspect food can be a vital, if rare, piece of evidence. Usually, the food suspected of causing illness has already been eaten, opened or discarded by the time illness emerges and an investigation is launched.
The health agency picked up the chicken from Monroe's home, placed it on ice inside a double layer of biohazard bags and took it to a state laboratory in Austin for testing, according to Samp, who said the agency followed state protocols.
The state lab, however, determined the chicken wasn't suitable for testing. A spokesperson for the Texas Department of State Health Services told ProPublica that Austin Public Health had collected two leftover rotisserie chickens from Monroe's house — one in the unopened package and one in an opened package — and transported them in the same bag, creating the potential for cross-contamination. "We have very strict protocols that must be followed to ensure the integrity of the samples collected for testing," the spokesperson, Lara Anton, said.
So what could have been the key to determining what made everyone sick ended up unexamined, underlining one of the challenges inherent in investigating foodborne illnesses.
"That's the nature of the beast," said Jack Guzewich, who for 11 years led the FDA's foodborne disease surveillance and response program. "There's so many other things that can go wrong that you end up inconclusive."
Guzewich, who left the FDA in 2011 and worked as a consultant on foodborne disease investigations before retiring, said that had the leftover chicken been tested, it might have shown whether the chicken from Sam's Club was carrying the same strain of salmonella that made everyone sick. "If the chicken sampling had been done correctly, they might have had the smoking gun and met the gold standard," he said.
Based on samples from 26 of the victims, investigators determined that the funeral goers had been infected by a form of salmonella known as Saintpaul. It's one of a relatively small number of salmonella types that account for most of the salmonella infections documented by the CDC. In 2008, Saintpaul, named for the Minnesota city where a scientist first isolated the strain, caused an outbreak that led to more than 1,400 infections nationwide. In the years since, the CDC has documented about 200 cases a year, about a fifth of them leading to hospitalization. (The CDC estimates that for every confirmed salmonella infection, almost an additional 30 go unreported.)
Even as the Austin health agency was investigating, some of the victims were pressing for answers on other fronts, contacting Sam's Club and enlisting a personal injury lawyer.
Two days after the funeral, one relative reported the outbreak to Sam's Club through a contact form on the company's website. About a week later, another reported the outbreak to Sam's Club by phone. In an email to one of the relatives and a voicemail to the other, representatives of Sam's Club said the company had opened an "investigation."
Patrick Monroe, the relative who filed a complaint online, said a Sam's Club representative called him several weeks later and said because government investigators hadn't tested the chicken, there was "nothing" the store could do.
Keith Carter, the relative who had reported the incident by phone, said he didn't hear anything back from Sam's Club. "I kept calling them, and they never returned my calls," Carter said.
Hulliberger, the spokesperson for Sam's Club, said the company takes safety seriously. "We have policies in place to comply with strict food safety controls, which help ensure the food we provide is safe," she said.
She pointed out that the investigation had not determined what food caused many of the mourners to become ill. "Based on its investigation, Austin Public Health reported it was statistically impossible to implicate any of the food items from the funeral reception in 2019 as the source of illness that ProPublica is attempting to link to Sam's Club," she said.
In its report on the outbreak investigation, the health agency said it visited the store where the rotisserie chickens were purchased. It inspected its "kitchen and process" and did not note any violations.
A few of the relatives had found a firm willing to represent them in filing a lawsuit. It wouldn't be quick or easy, but it might give them some answers and perhaps some compensation for the harm endured by so many of the mourners.
But two months later, the firm, now known as Pastrana & Garcia, backed out. After the health department said it was not going to be able to pinpoint the source of the food poisoning, the lawyer who had agreed to represent the victims, Raul Steven Pastrana, told them the case was all but unwinnable. "Without the health department's willingness to identify one source of the poisoning, there are too many possible sources to meet the 'more likely than not' standard," he wrote in a letter to the relatives. In an email to ProPublica, Pastrana's firm declined to comment.
In Dale, a community about 30 miles south of Austin where many members of Lovey Jean Carter's family live, some in houses right across from one another, memories of the salmonella outbreak are still fresh. Intense pain, diarrhea, nausea and vomiting overtook every household in the family in the hours after the funeral reception. The youngest member of the family, a 1-year-old, was vomiting through the night while her grandfather anxiously looked after her. Several family members were taken to hospitals in ambulances.
It felt as if death was stalking them, Carter's mother, Lola Monroe, 94, said. "I think about that so often. My daughter's funeral, and right after the funeral everybody got sick."
Hattie Tibbs, 74, a family friend who was taken to a hospital in Kyle, said the illness brought her to tears. "Oh my, the pain," she said, "I wouldn't wish that on nobody."
Getting out of the hospital and over their symptoms wouldn't be the end. After the hospital stays and doctor's visits, bills began to arrive. For some, insurance covered nearly everything. Others still owe money to this day.
Keith Monroe, who stayed in the hospital for one week and didn't have health insurance at the time, was billed about $49,000, which he still owes. On top of his medical bills, Monroe, a handyman, lost work in the four months he was recovering.
Keith and Russell Carter, who are brothers and nephews of Lovey Jean's, held out for three days after the funeral, trying their best to avoid seeking care.
"We really didn't want the hospital bills. I knew if we went in, it'd be no telling how much it'd be," Keith Carter, 55, said. "We just tried to tough it out, and the more we tried to tough it out, the worse it got." Carter was vomiting, nauseated and completely dehydrated. His pain level, he said, reached a 10.
After about eight hours in the emergency room, his charges came to about $15,000, of which he was responsible for $1,700. Carter has five daughters and works as an equipment manager for the state's health and human services agency by day and as an airline baggage handler at night. He had to take time off from both jobs when he got sick.
"When you got five girls and you got other bills — you got car payments, house payments — it's money that you're spending that you really don't have," Carter said.
Having to pay for being sickened by the funeral food made the hospital charges all the more frustrating. "I really didn't want to pay anything, especially when you're not at fault," he said.
Today, Carter still suffers from abdominal pain. Tibbs had to change her diet because her stomach can no longer tolerate some of the foods it used to. And Keith Monroe has to use the restroom much more frequently because of lingering kidney problems.
Patrick Monroe said he is troubled that his relatives never got answers about what made them so sick. "I just don't know how something like this got passed over."
He is still paying off medical bills for himself and his two children. He doesn't eat rotisserie chicken anymore. And he gets anxious at doctors' offices, which bring back memories of all the illness the family endured. "I felt like I was going to die."
Michael Grabell, Mollie Simon and Bernice Yeung contributed reporting. Lexi Churchill contributed research.
Maryam Jameel is an engagement reporter working on community-sourced investigations out of ProPublica's Washington, D.C. newsroom.
By the time Cheryl Cosey learned she had COVID-19, she had gone three days without dialysis — a day and a half more than she usually waited between appointments. She worried how much longer she could wait before going without her life-saving treatments would kill her.
The 58-year-old Cosey was a dialysis technician for years before she herself was diagnosed with end-stage renal disease. After that, she usually took a medical transport van to a dialysis facility three days a week. There, she sat with other patients for hours in the same kind of cushioned chairs where she’d prepped her own patients, connected to machines that drew out their blood, filtered it for toxins, then pumped it back into their fatigued bodies.
Her COVID-19 diagnosis in the pandemic’s first weeks, after she’d been turned away from a dialysis facility because of a fever, meant Cosey was battling two potentially fatal diseases. But even she didn’t know how dangerous the novel coronavirus was to her weakened immune system.
Had she realized the risks, she would have had her daughter Shardae Lovelady move in. Just the two of them in Cosey’s red brick home on Chicago’s West Side, looking out at the world through the sliding glass door in the living room, leaving only for her dialysis.
After Cosey’s positive test in April 2020, Lovelady had to take her mother to a facility that treated patients with suspected or confirmed COVID-19. The facility fit her in for one of its last appointments the next day.
At that point, Cosey had gone more than four days without dialysis.
Four hours later, after Cosey completed her treatment, Lovelady returned to the nearly deserted building to bring her mother home, the sun having long disappeared from the sky. Cosey, dressed in a sweater and a green spring jacket, was disoriented, her breathing sporadic.
Alone with her mother on the sidewalk, Lovelady ran inside to ask workers for help getting Cosey out of her wheelchair and into her car.
“They offered no assistance,” Lovelady said. “They treated her as though she was an infection.”
(A spokesperson for the facility said employees aren’t allowed to help patients once they leave, for safety reasons.)
As Lovelady waited for paramedics to arrive, she grabbed a blanket from her car to wrap around her mother.
“My mother has COVID. I know she has COVID, but I didn’t care,” Lovelady said. “I hugged her and just held on until the ambulance came.”
Then she followed the flashing lights to the hospital.
In the three decades before the pandemic, the number of Americans with end-stage renal disease had more than quadrupled, from about 180,000 in 1990 to about 810,000 in 2019, according to the United States Renal Data System, a national data registry. About 70% of these patients relied on dialysis in 2019; the other 30% received kidney transplants.
The Midwest stood out as the region with the highest rate of patients with the disease, and Illinois had the nation’s third highest prevalence after Washington, D.C., and South Dakota, according to the Centers for Disease Control and Prevention.
A rare bright spot was the downturn in the death rate. Although diagnoses have been going up, death rates for patients who are on dialysis have declined since the early 2000s.
Then COVID-19 struck. Nearly 18,000 more dialysis patients died in 2020 than would have been expected based on previous years. That staggering toll represents an increase of nearly 20% from 2019, when more than 96,000 patients on dialysis died, according to federal data released this month.
The loss led to an unprecedented outcome: The nation’s dialysis population shrank, the first decline since the U.S. began keeping detailed numbers nearly a half century ago.
They were COVID-19’s perfect victims.
“It can’t help but feel like a massive failure when we have such a catastrophic loss of patients,” said Dr. Michael Heung, a clinical professor of nephrology at the University of Michigan. “It speaks to just how bad this pandemic has been and how bad this disease is.”
Before most patients reach advanced kidney failure, they are diagnosed with diabetes, hypertension or a host of other underlying conditions. Their immune systems are severely compromised, meaning they are essentially powerless to survive the most dangerous infections.
Many are old and poor. They also are disproportionately Black, as was Cosey. A 2017 study called end-stage renal disease “one of the starkest examples of racial/ethnic disparities in health.” Those inequities carried through to the pandemic. Dialysis patients who were Black or Latino, according to federal data, suffered higher rates of COVID-19 by every metric: infection, hospitalization, death.
Their deaths went largely unnoticed.
To get their treatments, the majority of dialysis patients in the U.S. must leave the relative safety of their homes and travel to a facility, often with strangers on public or medical transportation. Once at the dialysis center, they typically gather together in a large room for three to four hours.
The fear of contracting the virus was enough to keep many from venturing out for medical care, including those already on dialysis and those set to get the treatment for the first time. Exactly how long patients can go without dialysis depends on a number of factors, but doctors generally begin to worry if they miss two of their thrice-weekly sessions.
Dr. Kirsten Johansen, director of the United States Renal Data System, said the rates of people starting dialysis had been relatively stable until the pandemic. “Then the floor fell out,” she said in an interview.
COVID-19’s collateral damage played out in other ways as well. It meant that people delayed going to the hospital for everything from heart disease to cancer. For dialysis patients, whose life expectancy in some cases is three decades shorter than the general population, the results were calamitous. Hospitalizations of dialysis patients for reasons unrelated to COVID-19 dropped 33% between late March and April of 2020, federal data shows.
Dr. Delphine Tuot, a nephrologist and associate professor at University of California San Francisco and Zuckerberg San Francisco General Hospital and Trauma Center who focuses on vulnerable populations, found herself pleading with some of her patients to come in for their regular dialysis appointments.
One of them was a 60-year-old man whose shortness of breath landed him in the hospital in February. Doctors scheduled dialysis three times a week, and though he was initially resistant, Tuot said, he came around once he realized he would die without it.
Still, he missed appointments. When Tuot followed up, he told her he was afraid to leave the house because he was caring for his wife who had cancer, and he didn’t want to contract COVID and bring it home to her. Soon a cycle began. He skipped treatments, fluid built up in his body and an ambulance rushed him to the hospital because he couldn’t breathe. He got dialysis, was sent home and got back on track.
When cases surged and the delta variant took hold this summer, the cycle restarted — until he skipped dialysis for three weeks in a row, so long that his heart couldn’t recover, according to Tuot. He died last month.
Despite early efforts to mask and isolate patients at dialysis facilities, one study found the rate of COVID-19 hospitalizations of dialysis patients from March to April 2020 was 40 times higher than the general population.
Even with skyrocketing hospitalizations, it took three months after vaccines were approved before federal officials provided vaccinations to dialysis clinics, despite advocacy groups urging that this high-risk population be prioritized.
Although dialysis centers were swift to implement safety protocols in the pandemic’s early days, some facilities didn’t follow their own infection control policies, including washing hands properly, keeping workers home when sick or disinfecting equipment, federal inspection records show.
And home dialysis, which has been shown to be safer for patients during the pandemic, is out of reach for many, especially Black and Latino patients. Nephrologists had pushed for greater access to home dialysis before the pandemic; that need is more apparent now than ever, Tuot said.
“The fact that individuals had to go to a center with other individuals who are equally immunocompromised and had to get to that center, whether that was by public transportation or by van transportation, it’s clearly additional risks,” Tuot said. “Bottom line, they are very vulnerable. They’re very sick.”
The ambulance took Cosey to Chicago’s Rush University Medical Center. Lovelady filled in the staff on her mother’s medical history of end-stage renal disease, high blood pressure and asthma. The next day, Cosey called her daughter from her hospital bed. Lovelady noticed marked improvement from the night before.
“She sounded like herself,” Lovelady said. “We joked around a little bit. I asked her what kind of medicine she was on. She said they started her on dialysis.”
One by one, Lovelady added her sister, cousin and brother to the call. They told Cosey she had scared them, but now that she was doing better, they teased that they needed her to come home to bake her famous cheesecake. Her grandchildren hadn’t stopped asking about her either. They missed movie nights at Cosey’s house, when she made them popcorn and covered the floor with blankets.
Cosey’s boisterous laugh reassured them.
When Lovelady sensed her mother tiring, she told her she’d call her back the next day.
“Go ahead and get some rest,” she said.
While the arrival of the pandemic rocked the health care system as a whole, the effect on dialysis facilities has received little attention.
The Centers for Medicare & Medicaid Services typically monitor the facilities through routine inspections and surprise visits to investigate specific complaints. But federal officials are two years overdue on more than 5,000 inspections at dialysis facilities across the country, Medicare data shows, and three years behind on more than 3,000 of them. Since the start of 2020, the number of inspections to dialysis facilities by government officials fell by more than 30% from the previous two years, ProPublica found. Complaints made up a larger portion of investigations. In 2019, 35% of total visits were in response to complaints. Last year, it jumped to 51%.
A spokesperson for the Centers for Medicare & Medicaid Services said in a statement that the pandemic forced the agency to temporarily suspend or delay inspections for non-urgent complaints and routine inspections to focus on infection control and critical concerns that placed patients in immediate jeopardy. The agency is working with states, which act on behalf of federal officials, to address the resulting backlog, the spokesperson said, but “nearly all state agencies report insufficient resources to complete the required, ongoing federal workload.”
The spokesperson said “the COVID-19 pandemic has presented a unique challenge unlike any other in history and has impacted our routine oversight work,” adding that “complaint investigations remain our first priority to ensure we address the immediate needs of patients receiving care in dialysis facilities.”
Insufficient funding has compounded those challenges. The budget for inspections has “been flatlined” since fiscal year 2015, while the number of dialysis facilities has increased by 21% to nearly 8,000 today, according to the agency. After several years of requesting more money, the centers were approved to receive an increase for fiscal year 2022.
When investigators did inspect dialysis facilities, they found some violations specific to COVID-19 and others that involved general safety lapses, according to federal records from March 2020 to July 2021.
A dialysis patient who started treatment just before the pandemic died after a nurse at a Kentucky facility failed to properly dilute an antibiotic, according to inspection reports. Minutes after the medicine began dripping through an IV, the patient said: “My body is on fire! It’s going through my whole body,” records show.
At a New York facility, another patient died after losing more than 1 1/2 pints of blood when their catheter became disconnected, according to federal records. That same facility underreported its number of deaths in the first 11 months of the pandemic by 16 people.
Federal officials issued their most serious citation to an Indiana facility for refusing to provide dialysis to a patient suspected of having COVID-19. The patient’s previous dialysis had also been cut short because their assisted living facility did not provide them transportation after 9:15 p.m. So they did not receive a complete treatment.
An estimated 5% to 10% of end-stage renal patients live in congregate settings, such as nursing homes or assisted living facilities. The same factors that led to nursing home populations being decimated — age, health, difficulty isolating — applied to those dialysis patients. In the first months of the pandemic, they contracted the virus at a rate more than 17 times higher than those who lived independently, according to one study.
Workers at those facilities weren’t immune either. Oluwayemisi Ogunnubi, 59, worked as a nurse administering dialysis to patients inside a nursing home on Chicago’s South Side. A Nigerian immigrant, she had sent money home to pay for her children’s schooling until she was able to bring them to the U.S. Her smile and supportive nature made her popular among her coworkers, according to an official at Concerto Renal Services, the dialysis company where she worked.
On April 21, 2020, Ogunnubi’s body began to ache, and she was sent home early from work. She was later taken to a hospital, where she tested positive for COVID-19. She died three days later, federal and county records show.
Occupational Safety and Health Administration officials cited Concerto, and levied a penalty of $12,145. The company provided employees who performed dialysis on patients with N95 respirators, but investigators found that Concerto’s written procedures weren’t complete and that the company had failed to provide medical evaluations that ensured employees knew how to use the respirators.
Two other Concerto employees, including one who fell ill the same day as Ogunnubi, contracted COVID-19 at the time but survived. Within two weeks of Ogunnubi’s death, 10 residents at the nursing home died of complications related to COVID-19, according to Cook County Medical Examiner records. Half had kidney failure.
Kyle Stone, Concerto’s executive vice president and general counsel, said the first and only COVID-related death of an employee shook the company. Stone said Concerto “made a difficult choice” to use respirator masks without providing medical evaluations to employees, but it “was clearly the correct choice under the circumstances.”
If Concerto had been required to fulfill every aspect of OSHA requirements for a written policy that early in the pandemic, he said, the company would not have been able to provide the respirator masks, “almost certainly resulting in greater risk of harm and death.”
OSHA’s failure to “see and appreciate” the trying circumstances at the time, Stone said, was “baffling and disappointing.” Concerto eventually settled with OSHA, which downgraded the violation and reduced the penalty to $9,000.
“We are quite proud of our work in 2020 during the eye of the COVID storm,” Stone said.
As devastating as the pandemic has been, many experts say it could have been worse. Dr. Alan Kliger, a clinical professor of medicine at Yale School of Medicine, co-chaired the American Society of Nephrology COVID-19 Response Team that held weekly calls with chief medical officers from 30 or so dialysis companies, including the largest two, DaVita and Fresenius. The facilities, Kliger said, implemented universal masking and patient screenings before the CDC recommended them. They also treated COVID-19 patients in separate shifts or at specifically designated isolation clinics.
“There’s been a tremendous amount of collaboration and sharing of information and uptake of best practices in this group of competitive companies,” Kliger said. “They really rallied together to protect patients.”
Epidemiologist Eric Weinhandl said that there’s another battle on the horizon with the omicron variant spreading rapidly, which he finds especially worrisome given how federal officials failed by not distributing vaccines to dialysis facilities in December 2020.
“It’s heartbreaking because you look at this, and much like nursing home residents, these patients are completely vulnerable. But they still have to go to a dialysis facility three times a week,” Weinhandl said. “Why wouldn’t you prioritize this population?”
The CDC said in a statement that “demand exceeded supply” when vaccines were first authorized and “as supply increased and states adopted CDC’s recommendations, older adults and those with underlying health conditions began being prioritized.”
It wasn’t until March 25 that the Biden administration announced it was partnering with dialysis facilities to send vaccines to patients at the centers.
Now, Weinhandl wonders if dialysis patients will be a priority if the federal government approves a second round of boosters for high-risk patients.
“Is there a plan? Because I think that there should be,” he said. “I think this is getting pretty predictable. Every time COVID surges, you see the dialysis population’s excess mortality surge with it.”
Sometimes the frailty of dialysis patients is no match for COVID-19’s brutality.
Oscar and Donna Perez were the kind of siblings who loved each other without judgment or condition. After Oscar began dialysis in 2018, Donna picked him up from his appointments three nights a week. She cut his toenails when his feet were too swollen for him to reach and massaged them when the pain woke him up at night.
He was her son’s godfather, her best friend who shared his love of music with her — especially the 1960s R&B singer Billy Stewart — and annoyed her in the way only brothers can, swatting her feet off chairs just as she got comfortable and pestering her with questions when she was deep into Instagram.
But Oscar Perez was sick. In addition to his failing kidneys, the 38-year-old Latino father struggled with hypertension, diabetes and congestive heart failure. In early January, doctors performed coronary bypass surgery. He was not yet eligible for the vaccine, but the hospital tested him for COVID-19 when he was admitted. He was negative.
He went home on Jan. 18, the same day as the wake for his uncle, who, his family said, died after he missed too many dialysis appointments. But the next day, Oscar collapsed at home, confused and mumbling in pain, with signs that the coronavirus was flourishing in his lungs. He was rushed back to the hospital. A doctor called to tell Donna Perez that her brother had tested positive and needed to be intubated.
On Jan. 31, doctors called Donna again and told her that her brother’s condition was declining fast. She picked up her parents, another brother and his girlfriend, and headed to the hospital to visit Oscar from outside the glass door of his room. They told doctors to try to resuscitate him if his heart stopped.
That night, after they returned home, Donna Perez’s phone rang one more time. Oscar’s doctor said he probably wasn’t going to make it through the night. This time, they could visit him in his hospital room in PPE.
Seeing her brother up close, swollen and helpless, she leaned in, hugged him, and said, “I can tell you’re tired. You can go.” Donna promised to take care of his daughter.
Her family pushed back and said she had to tell him to be strong.
Donna told them they needed to let Oscar go. He died a few hours later.
“This disaster is one that befalls dialysis patients, with diabetes especially, regularly,” Dr. David Goldfarb, clinical director of the nephrology division at NYU Langone Health in New York City, who reviewed Oscar Perez’s medical records for ProPublica.
“Of course, it’s possible to do better,” he continued. “Given his age, it’s really tragic.”
The advent of technology to filter a patient’s blood revolutionized kidney care in the 1950s, and people lined up to get access to the limited number of machines. In 1960, one hospital created its own admissions panel, later nicknamed the “God committee,” to review cases to decide who would receive the groundbreaking treatment.
Twelve years later, Congress approved legislation that created the Medicare End Stage Renal Disease program, which guaranteed coverage of medical care, including dialysis and kidney transplants. It remains the only disease-specific Medicare entitlement program, credited by some as possibly saving more lives than any other federal government program. Generally, Medicare only covers those over age 65 and the disabled, but this program is available to people of all ages with end-stage renal disease.
Total Medicare-related spending in 2019 on end-stage renal disease patients topped $50 billion. Even with that budget, the agency hasn’t been able to fix persistent health disparities. That year, Black patients were more than four times more likely than their white counterparts to have the disease.
Black patients also progressed from chronic kidney disease to end-stage renal disease three times as often as white patients. Yet they are less likely to start off their dialysis treatments on a waiting list for a transplant — or eventually receive one from a living donor — than white patients.
In a statement, Medicare said it is working to address the disparities and said it is “committed to ensuring the health and safety” of all its dialysis patients.
Another area of concern is home dialysis, which research has shown is cheaper than in-center dialysis and offers similar or better survival rates, enhanced quality of life and greater flexibility. Barriers to home dialysis affect all patients, but the percentages of Black and Hispanic patients receiving home dialysis in 2019 were 10% and 11% respectively, compared with white and Asian patients at 17% each.
The push for closing that gap has gained traction, bolstered by federal data that found COVID-19 hospitalizations rates of patients who underwent home dialysis from late March to June 2020 were between one-quarter and one-third those of patients traveling to dialysis facilities.
“We do have to figure out a way to do better because we’re really, in essence, causing harm, when we’re not able to divert proper resources to patients who most require them,” said Dr. Kirk Campbell, a nephrology professor and vice chair of medicine for diversity, equity and inclusion at the Icahn School of Medicine at Mount Sinai in New York City.
Some patients don’t have the space to store the supplies needed for home dialysis. Others are overwhelmed by the prospect of having to keep the area around the catheter clean to prevent infection. But, Campbell said, that’s where patient education comes in. The most common type of home dialysis, called peritoneal dialysis, often is done at night while the patient is sleeping and does not involve blood flowing outside the body.
While home dialysis isn’t possible for all patients, some doctors are hesitant to recommend it at all, in part because the clinicians lack the training, experience or a certain comfort level with it. That’s especially true, Campbell said, for patients of color and those from disadvantaged backgrounds. There’s often an unconscious bias that those patients won’t be able to handle it, he said.
Campbell and others said it’s critical that clinicians receive additional training in home dialysis. He leads one of the few nephrology fellowship programs in the country where doctors can spend an extra year specializing in home dialysis. The results have been so promising, he said, that they hope to expand.
In July 2019, the Trump administration issued an executive order aimed at revamping kidney care in the United States through the Department of Health and Human Services’ Advancing American Kidney Health initiative. The goals of the initiative were lofty — some say unrealistic — and included having 80% of new end-stage renal disease patients in the U.S. receive in-home dialysis or transplants by 2025. In 1972, the year the Medicare program passed, 40% of patients were on home dialysis. Currently, about 13% of patients are receiving dialysis at home.
Starting January, the Centers for Medicare & Medicaid Services will offer facilities greater reimbursement for improving their home dialysis rates for low-income patients.
Some observers say the change doesn’t go far enough. In September, U.S. Rep. Bobby Rush, an Illinois Democrat, and Rep. Jason Smith, a Republican from Missouri, proposed legislation that would require Medicare to pay for workers to assist patients who need additional help with home dialysis. The measure, which was introduced without much fanfare, also calls for greater patient education around the treatment and a federal study analyzing racial disparities.
Hong Kong, where about three in four patients are on peritoneal dialysis, is a global leader in home treatment. Patients there receive peritoneal dialysis first unless there is a medical reason that would preclude it.
Dr. Isaac Teitelbaum, a nephrologist who has been the medical director of the home dialysis unit at the University of Colorado School of Medicine since 1986, said expanded training for clinicians and incentives for patients, including a reduced co-pay or a tax credit, could encourage more patients to dialyze at home.
“You don’t live just so you can do dialysis. You do dialysis so that you can enjoy life,” he said. “You do dialysis so that you can watch your children and grandchildren grow up and so that you can participate in family events and go on vacations.”
Cheryl Cosey was not offered home dialysis, her family said. Shardae Lovelady said it might have made all the difference for her mother.
Cosey’s health deteriorated quickly after the call from her hospital bed. Doctors transferred Cosey to the intensive care unit, put her on a ventilator and gave her medication to push the oxygen from her lungs into her bloodstream, according to hospital records.
The family braced themselves. Lovelady drove to Minnesota to pick up her sister. She gathered everyone for a big dinner the way her mother used to do.
Lovelady and her sister stayed up late talking, finally dozing off when the house quieted.
When the phone rang at three in the morning, Lovelady recognized the hospital’s 312 area code.
Everything she had done to prepare for that moment suddenly vanished, and she allowed herself to hope.
The call was short. She never even flipped on the bedroom light. She turned to her sister, who was asleep next to her, and nudged her awake.
Irene Bosch developed a quick, inexpensive COVID-19 test in early 2020. The Harvard-trained scientist already had a factory set up. But she was stymied by an FDA process experts say made no sense.
This article was published on Tuesday, December 21, 2021 in ProPublica.
When COVID-19 started sweeping across America in the spring of 2020, Irene Bosch knew she was in a unique position to help.
The Harvard-trained scientist had just developed quick, inexpensive tests for several tropical diseases, and her method could be adapted for the novel coronavirus. So Bosch and the company she had co-founded two years earlier seemed well-suited to address an enormous testing shortage.
E25Bio — named after the massive red brick building at MIT that houses the lab where Bosch worked — already had support from the National Institutes of Health, along with a consortium of investors led by MIT.
Within a few weeks, Bosch and her colleagues had a test that would detect coronavirus in 15 minutes and produce a red line on a little chemical strip. The factory where they were planning to make tests for dengue fever could quickly retool to produce at least 100,000 COVID-19 tests per week, she said, priced at less than $10 apiece, or cheaper at a higher scale.
Bosch’s prototype attracted a top Silicon Valley venture capital firm, which pitched in $2 million.
“We are excited about what E25Bio is capable of shipping in a short amount of time: a test that is significantly cheaper, more affordable, and available at-home,” said firm founder Vinod Khosla. (Disclosure: Khosla’s daughter Anu Khosla is on ProPublica’s board.)
On March 21 — when the U.S. had recorded only a few hundred COVID-19 deaths — Bosch submitted the test for emergency authorization, a process the Food and Drug Administration uses to expedite tests and treatments.
A green light from the FDA could have made a big difference for the many Americans who were then frantically trying to find doctors to swab their noses, with results, if they were lucky, coming back only days later.
But the go-ahead never came.
In the months that followed, Bosch responded to repeated requests from FDA reviewers for data and studies. When the agency finally put out guidance that summer about the performance over-the-counter home tests needed to meet, officials required that such tests be nearly as sensitive as the lab tests used to definitively determine whether a patient has COVID-19.
That standard proved difficult to meet. Rapid tests are usually sensitive enough to detect viral antigens when someone has enough of them to be able to spread the disease. Such tests are not as good at picking up cases in either earlier or later stages of infection, when viral loads are lower.
Bosch’s tests missed the FDA’s high bar. It wasn’t until the spring of 2021 that much larger companies were able to design similar tests — relatively inexpensive, over-the-counter rapid tests — that the agency found acceptable.
“You could have antigen tests saving lives since the beginning of the pandemic,” said Bosch, sitting in her lab at MIT. “That’s the sad story.”
While E25Bio’s test didn’t catch quite as many cases as those now on the market, it could have been used to catch superspreaders, with warnings that a negative result wouldn’t rule out infection. Experts told us that the test could have been a vital public health tool had it been produced in the millions in 2020 just as COVID-19 was racing across the country undetected.
“Since we didn’t have other options, it would have been a very good test,” said Michael Mina, an epidemiologist who followed E25Bio’s early progress. “If we were going to war, and somebody was invading us, and we had a bunch of revolver pistols, and we didn’t yet have the shipment of machine guns, hell yeah, you’re going to pick up the revolver pistol. You do what you can when you need to in an emergency.”
Three other experts reviewed Bosch’s submissions at ProPublica’s request and agreed that her test approached what is now considered acceptable for over-the-counter tests.
Mina and others have been calling for an embrace of rapid testing since the pandemic’s early days, saying that tests should be ubiquitous and cheap enough that people could stock them in their medicine cabinet, like aspirin or Band-Aids. Although not a panacea, rapid tests can slow the spread of COVID-19 when used repeatedly and when the infected follow instructions to isolate, manystudiessuggest.
After not showing urgency on the issue for much of the past year, the Biden administration has moved recently to boost production and lower prices. Facing a huge new wave of cases and an increasing outcry about shortages of tests, Biden announced Tuesday that 500 million more at-home tests would be distributed by mail, starting in January.
David Paltiel, a professor at the Yale School of Public Health, said a significant part of the problem is that the FDA created a detailed roadmap for tests that give patients a close-to-definitive answer on whether they have COVID-19, but never created a separate framework for rapid tests that serve a different purpose: helping people get frequent, fast evidence of whether they may be contagious.
“The former are tests of infection; the latter are tests of infectiousness,” Paltiel said. “They both share the same regulatory pathway — a pathway that was designed with diagnostic testing in mind and is littered with requirements that make no sense for the purpose they serve.”
He added, “It’s an outrage that rapid tests aren’t dirt cheap and plentiful on grocery store shelves.”
The FDA declined to comment on individual test submissions, but said in a statement that it has worked to authorize “accurate and reliable” home tests since the beginning of the pandemic.
“Unfortunately, many submissions the FDA has received for home tests include incomplete or poor data, and it is the FDA’s responsibility to protect the public health by declining to authorize poorly performing tests or those without complete data,” the agency said. “We have also worked interactively with many developers to resolve concerns when data was incomplete or unclear, or to find solutions to issues that arose during review. If the FDA received a home test that the data and science supported in early-to-mid 2020, we would have quickly authorized it.”
Bosch has since moved on to start a new venture focused on helping other test developers conduct trials that meet the FDA’s standards. This winter, she’s working with the housing authority in the high-poverty Boston suburb of Chelsea to conduct a trial using several tests that have been authorized in other countries, but not America. The goal: to demonstrate that such tests can be effective when deployed for free, in conjunction with education and outreach.
“The next thing is frequent testing for communities that need it,” Bosch said. “How do we flood the market with a $2 test that is as good as a $20? We’re doing it in Chelsea. We should be an example for the whole country.”
American medical device regulators have never been enthusiastic about letting people test themselves.
In the 1980s, the FDA banned home tests for HIV on the grounds that people who tested positive might do harm to themselves if they did not receive simultaneous counseling. In the 2010s, the agency cracked down on home genetic testing kits, concerned that people might make rash medical decisions as a result.
But the FDA wasn’t an obstacle to Bosch’s work on tropical diseases, since the tests were mostly needed in places like the Brazilian Amazon, where infected mosquitoes are hard to escape. The National Institutes of Health thought Bosch’s tests had enough potential to give E25Bio $1.8 million for the project.
So when the pandemic struck, the small company decided to use its expertise for the new threat. Within a few weeks, Bosch and her colleagues developed antibodies that could detect the presence of proteins attached to the new coronavirus.
In her previous work, Bosch had found that tests of this type could be validated in the lab, so she ordered up some samples of the SARS-CoV-2 virus and ran two different types of antigen tests on them. She found that both worked fairly well, and packaged up all her evidence and sent it to the FDA, with little guidance on what would pass muster.
Shortly after, an FDA reviewer told her she’d need to conduct a clinical trial, which would take months. “My first huge surprise was when they said, ‘Nope, none of your validations are going to pass for an EUA,’” Bosch said.
The next challenge was that the accuracy of antigen tests would be measured by how they compared to a different type of diagnostic: the polymerase chain reaction, or PCR, test, which is considered the “gold standard” for finding coronaviruses. Many see that as an unproductive comparison, given the fact that PCR detects remnants of the virus, which may persist for many days after the infection ceases to be a threat.
“When you’re PCR testing, you’re testing for the presence of viral genetic material,” said Hannah Mamuszka, the CEO of Alva10, a company that helps diagnostics manufacturers prove their value for insurers. “When you’re antigen testing you’re testing for presence of a protein on the surface of the virus,” she said. “Those are obviously not the same thing. So it’s really confounding that the FDA has had such a hard time communicating what they need, and defining what a test would need to look like to be used at home.”
Nevertheless, by April 2020, E25Bio had lined up a trial with three hospitals in Florida. They found the test identified 80% of the swabs that a PCR test had shown to be positive (known as sensitivity) and 94% of the negatives (known as specificity).
The FDA wanted to see fewer false positives, even though people who test positive on an antigen test are usually advised to confirm it with a PCR. And while the overall sensitivity of E25Bio’s test was lower than other tests would later demonstrate, it measured 100% for people with higher viral loads — those most likely to be infectious.
Bosch was in frequent contact with her assigned reviewer at the FDA, and even talked to Tim Stenzel, the head of the agency’s office that vets diagnostic tests. The Bill & Melinda Gates Foundation gave E25Bio another $500,000 to continue research and development.
But at the end of July 2020, the FDA came out with a template that laid out the expectation that tests available for home use without a prescription would reach 90% overall sensitivity — that is, antigen tests would pick up nine out of ten positive tests that a PCR identified. Bosch knew her tests couldn’t meet that standard. And without an EUA for home use, they wouldn’t be able to serve their intended function.
Already, plenty of models had illustrated the importance of frequent testing, including one co-authored last year by Yale’s Paltiel with Rochelle Walensky, now head of the Centers for Disease Control and Prevention. In September 2020, as chief of infectious diseases at Massachusetts General Hospital, Walensky argued that antigen tests were actually most useful for pinpointing people at their most infectious.
In fact, the utility of that approach was being tested at Bosch’s own former workplace. Beginning in the late summer of 2020, a coworking lab space in Cambridge where E25Bio had launched started a trial with 257 of its users who agreed to take both the antigen rapid test at home and a PCR test twice a week. (This was also closer to a home use scenario than the Florida hospitals study, in which COVID-19 was more prevalent and tests were administered by medical professionals.)
A peer-reviewed paper based on the results showed overall sensitivity of 79%, and that the rapid test picked up nearly all of the positives later detected by a PCR in the first few days after symptoms appeared, allowing infected people to stay out of the office as soon as they knew.
But the FDA does not consider test performance data broken out by how much virus the subjects have in their systems, saying the typical method for measuring it is inconsistent. Nor did the agency initially authorize tests on the condition that they be sold in packs of more than one, with instructions to use them sequentially to catch any fast-moving infections.
Bosch wasn’t the only one to be tripped up by the new standard. In mid-September 2020, Stenzel said on his weekly town hall call with test developers that his office had received zero applications for home use tests, a month and a half after putting out the template, despite his insistence that the agency was willing to be “flexible.”
Meanwhile, a $666 million NIH program to accelerate the approval and production of new COVID-19 tests funded mostly PCR tests in 2020.
The antigen tests that did make it into the NIH program in the first threefundingrounds — including one made by Quidel, a public company that multiplied its profits by tenfold in 2020 over the previous year — generally had to be processed in labs or required expensive analyzers.
One of few simple antigen tests to win government support, made by Maxim Biomedical, still hasn’t submitted an EUA application, according to chief operating officer Jonathan Maa. Another grantee, Ellume, was authorized for nonprescription home use in December 2020. But it took months to go into widespread production, and still costs $39, if you can find it.
Toward the end of October 2020, Bosch received a 48-hour ultimatum from the FDA for a response to a request for additional data. She had answers to the agency’s questions, but didn’t quite make that deadline.
By the time she replied, the FDA had already closed her application. “You call and they say, ‘Oh sorry, the clock started and we can’t stop it,’” she said.
Soon after, the company’s leadership asked her to resign. The company continues to operate, but hasn’t obtained FDA authorization for any tests. “As we commercialize our COVID-19 rapid tests internationally, we are also focused on developing the next generation of rapid tests for consumer diagnostics,” an E25Bio spokesperson said, while declining to comment on Bosch’s departure or its current product pipeline.
“All our life, day in and day out, went to make antigen tests,” Bosch said. “It was tragic, because it was all because the FDA decided to be so harsh in their responses that investors said, ‘Oh, there’s no way she will pull it out.’”
E25Bio’s travails with the FDA didn’t stop Bosch from putting her expertise to use.
In early 2021, she started talking to the city of Chelsea about running a trial that could show how rapid antigen testing — even with the types of tests that the FDA had rejected — could be rolled out in a high-risk community. In the spring, when infection rates in Chelsea were among the highest in the nation, many residents had had a difficult time accessing PCR tests, because the places administering them often dissuaded immigrants by requiring identification.
Chelsea officials agreed, and Bosch secured donations of tests from five manufacturers that had been authorized in Britain, Germany, India or Korea, but none yet in the U.S. (They can still be used here for research purposes.) She said she has validated them in her lab and found them to be about as accurate as BinaxNOW, the FDA-authorized home test made by medical device giant Abbott Laboratories.
“If they have a budget for next year to do frequent testing, this will be an accomplishment,” Bosch said. “I wanted to show to the world that an experimental device is just as good as any other already-approved FDA test.”
So for the past few months, Bosch has canvassed three buildings owned by the local housing authority. Bosch, who is from Venezuela, puts on salsa music and explains in Spanish how the program will work.
The trial began in earnest last week, with study administrators walking newly enrolled subjects through using the tests. In a building reserved for elderly and disabled people, residents entered with walkers and in flip-flops to learn how to swab their noses, put the swabs in a vial of solution, squeeze a few drops onto a pad and wait anxiously for the single line to appear that would indicate a negative result.
Most were able to take a picture of the results with their phones and upload them using a special app, which they’ll continue to do in their homes each week.
The FDA frowns upon this kind of instruction in trials for at-home tests — users are supposed to be able to execute the test without training. But in reality, many need support.
For the nonprofit that helped launch the effort, the Center of Complex Interventions, the important part is demonstrating that rapid tests can work when used as part of a coordinated testing regime to address specific situations: right before people gather indoors or after an exposure to an infected person, for anyone in a high-risk job, for people in crowded living situations, or for those who have health risk factors. People in all of those situations are concentrated in Chelsea’s housing authority buildings.
“It’s a lot different than saying, ‘Let’s roll it out to everybody,’” said Karthik Dinakar, who is leading the project. “It all has to be connected in a way that makes people feel like they’re participating. The goal for us is to make the community safer, and also shift the mindset to a new equilibrium.”
Joshua Sharfstein, a vice dean at Johns Hopkins University’s Bloomberg School of Public Health who used to be principal deputy commissioner of the FDA, said that rapid tests could have been authorized earlier with these kinds of protocols in mind.
“There was no testing strategy,” Sharfstein said, outlining the opportunity that America missed to use a variety of tests for the purposes to which they were best suited. “What they could have done is to say, ‘Here are the six uses of tests. You’re sick, you’re exposed, you’re trying to maintain people on a campus. What’s the performance of test that you would need?’
“Just think how amazingly helpful that would be,” he finished, wistfully.
Meanwhile, the CDC and NIH have been studying similar programs in a handful of communities using Quidel’s at-home test. Governors have been catching on to the utility of rapid tests too. Last week, the state of Massachusetts bought millions of rapid test kits made by iHealth laboratories. The company’s chief operating officer, Jack Feng, told National Public Radio that the price was higher in the U.S. because of the expense of clinical trials that aren’t required elsewhere.
And since rejecting Bosch’s submissions, the FDA has been coming around to her way of thinking. In March, the agency published a template for tests that would be used serially and sold in packages of two or more, allowing the kind of frequent testing she had advocated for. And last month, it published a new template that lowered the sensitivity standard for single-use over-the-counter tests to 80%.
Bosch had tests a year and a half ago that missed that bar by 1%.
