FTC Sues the Largest Anesthesiology Provider in Texas

The Federal Trade Commission filed a lawsuit Thursday against U.S. Anesthesiology Partners accusing the company of executing a multi-year scheme to consolidate anesthesiology practices in Texas in order to drive up prices in the state at the expense of patients.

The New York-based private equity firm Welsh, Carson, Anderson & Stowe, which is also named as a defendant in the lawsuit, is accused of founding the anesthesiology chain in 2012 for the purpose of executing the alleged scheme. The lawsuit was filed in a federal court in Houston, Texas.

“Welsh Carson saw that eliminating competitors — by acquiring or conspiring with them, instead of competing on the merits — would give USAP the power to raise prices, raking in tens of millions of extra dollars for USAP,” the lawsuit reads.

The FTC alleges that Anesthesiology Partners exploited the fact that anesthesia services are required for surgery and that hospitals and insurers would pay any price for the services.

By 2021, USAP had grown to 4,500 anesthesia providers at 1,100 healthcare facilities.Mandel Ngan/Getty

In 2013, the group was made up of about 400 anesthesia providers at 45 healthcare facilities, according to the lawsuit. By 2021, the company had grown to 4,500 anesthesia providers at 1,100 healthcare facilities.

“The FTC will continue to scrutinize and challenge serial acquisitions, roll-ups, and other stealth consolidation schemes that unlawfully undermine fair competition and harm the American public,” FTC Chair Lina M. Khan said in a statement.

The FTC is seeking a permanent injunction against the company to keep it from engaging in similar schemes in the future.

The company claims that the FTC’s allegations are misinformed.

“The FTC’s intended outcome threatens to disrupt and restrict patients’ equitable access to quality anesthesia care in Texas and will negatively impact the Texas hospitals and health systems that provide care in underserved communities,” Derek Schoppa, a USAP board member, said in a statement. “The FTC’s civil complaint is based on flawed legal theories and a lack of medical understanding about anesthesia, our patient-oriented business model, and our level of care for patients in Texas.”

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