Renalogic News

US Supreme Court Validates Self-Funded Health Plans’ Rights to Use Cost Containment

Media Release

CHICAGO, IL (June 22, 2022) –On June 21, 2022, the U.S. Supreme Court published its decision in Marietta Memorial Hospital, et al. v. DaVita, et al. In this decision, the Supreme Court ruled that self-funded health plans have the authority under the Medicare Secondary Payor Act (MSPA) to carve out dialysis benefits and set rates for such benefits at appropriate levels for plans and their members. In reaching its decision, the Supreme Court relied on the reasoning in the Amy’s Kitchen case, cementing Renalogic’s ImpactProtect cost containment program as the market-leading, most legally sound methodology for dialysis cost containment.




The kidney dialysis market is dominated by two large, multi-national companies: DaVita and Fresenius. Because of their dominance and lack of viable competition, dialysis rates billed to commercial health plans have ballooned by roughly 400% since 2008.


Marietta was one of five federal cases launched by DaVita in late 2018 – early 2019 against commercial health plans and other organizations.  In this lawsuit, DaVita argued that a commercial health plan does not have the legal authority to carve out dialysis benefits and pay dialysis claims differently from other types of claims under the MSPA.  In contrast, Marietta Hospital and the US Department of Justice argued that the MSPA was designed to coordinate benefits between insurance plans and Medicare for individuals covered by both, and not to provide preferential status to dialysis claims or individuals needing dialysis.


Marietta Hospital won in the trial court, while the Sixth Circuit Court of Appeals reversed the trial court’s decision, holding for DaVita.  The Supreme Court agreed to hear the case to settle the issue because of its importance and because the Ninth Circuit Court of Appeals reached an opposite decision than that of the Sixth Circuit in the landmark Amy’s Kitchen case. In Amy’s Kitchen, the Ninth Circuit categorically supported health plans’ authority to carve out dialysis benefits and approved Renalogic’s claims repricing methodology, ImpactProtect.


The Supreme Court’s Marietta Ruling


In Marietta, the Supreme Court ruled in Marietta Hospital’s favor, reversing the Sixth Circuit’s decision.  The Supreme Court firmly established that health plans have the authority under the MSPA to carve out dialysis benefits and recalibrate the cost of dialysis claims to levels more appropriate for plans and their members.  In reaching its decision, the Court looked to the Amy’s Kitchen case for guidance and support, clearly establishing Renalogic and its ImpactProtect cost containment program as the leader in the market with the most legally sound methodology.



About Renalogic

Renalogic is a purpose-driven business dedicated to reducing the human and financial costs of chronic kidney disease (CKD) and other illnesses for employer-based and other self-funded health plans. Founded in 2002, Renalogic combines NCQA-accredited Population Health Management clinical services, and cost containment services to simultaneously improve health outcomes and reduce costs. While we work on behalf of employers and self-funded plans, the Renalogic Five-Star Alignment Model™ enables benefit brokers and consultants, third party administrators, captive managers, and stop-loss carriers to actively guide and participate in the process of reducing their client’s costs and improving member health. With a clinical track record of preventing 99% of members with CKD progressing to dialysis, and cumulative client savings of more than $750 million, Renalogic is the recognized leader in helping employers and self-funded health plans fight CKD.