Texas Anesthesia Antitrust Lawsuit Expands
An antitrust lawsuit against U.S. Anesthesia Partners of Texas is advancing after plaintiffs expanded the class action to include clients statewide and ambulatory surgery centers (ASCs). The suit alleges market consolidation and anti-competitive pricing in healthcare services.
- The lawsuit alleges that U.S. Anesthesia Partners (USAP), with backing from private equity firm Welsh, Carson, Anderson & Stowe, systematically acquired nearly every large anesthesiology practice in Texas. This "roll-up" strategy was intended to create a single dominant provider with the power to demand higher prices. - This case is part of a broader Federal Trade Commission (FTC) crackdown on private equity roll-up strategies in healthcare, which the agency argues leads to monopolization and inflates costs for patients and businesses. The FTC's complaint alleges USAP's actions have cost Texans tens of millions of dollars more each year. - Studies have shown a direct correlation between this type of consolidation and increased healthcare costs. One 2022 study in JAMA found that prices for anesthesia services increased by an average of 26% after private equity-backed acquisitions. Another study found that in Texas specifically, anesthesia costs rose nearly 30% within two years of USAP acquiring practices in Houston and Dallas. - While the FTC's federal case against Welsh, Carson, Anderson & Stowe was dismissed on procedural grounds in May 2024, the firm entered into a consent order with the FTC. This agreement limits its ownership in USAP, requires it to seek prior approval for future anesthesia-related acquisitions, and reduces its board representation to a single seat. The FTC's lawsuit against USAP is proceeding. - The alleged anti-competitive behavior included not only acquiring competing practices but also making price-setting agreements with independent groups that remained and striking deals to keep competitors out of USAP's territory. - The expansion of the class-action lawsuit to include ambulatory surgery centers (ASCs) is significant as it highlights the impact of this consolidation on outpatient settings, a key area of growth and site-of-care shift in healthcare. Research indicates that when ASCs contract with private equity-backed physician management companies, anesthesia prices can rise significantly.
