First of all, it's not as common as what someone said about ALL older trannies failing pre-maturely, in fact most will last to about 140K miles or so w/o ever changing ATF, although I wouldn't advise neglecting fluid changes. Most 850s still have their original trannies, which is far better than what I'm hearing from those with domestic cars.
A Volvo OEM reman trans only costs about $1,500 from a dealer (NOT $4,000) and labor's 10 hours times their rate so depending on their rate, the total should be about $2,300.
Now, although the mentioned PNP switch is known to cause problems, it's NOT the only thing that can fail on these trannies so codes need to be checked first but if it's slipping, pressure tests need to also be performed.

Despite the fact that fluid changes aren't listed in Volvos maintenance for that trans, flushing your ATF periodically will help it last longer that it would otherwise with no fluid changes. I'd also recommend a good synthetic ATF as well.