Federal Trade Commission Chair Lina Khan testifies before a House Judiciary Committee hearing on Oversight of the Federal Trade Commission, on Capitol Hill in Washington, D.C., July 13, 2023.
Kevin Wurm | Reuters
The Federal Trade Commission on Thursday sued the biggest anesthesiology provider in Texas, claiming the corporate has wielded monopoly power to drive up prices for patients and boost its profits.
The FTC asked a federal judge in Houston, Texas, to interrupt up U.S. Anesthesia Partners’ alleged monopoly power and permanently bar the corporate from engaging in anti-competitive practices.
The agency claims that Latest York-based private equity firm Welsh, Carson, Anderson & Stowe founded U.S. Anesthesia Partners in 2012 to pursue an aggressive consolidation strategy that exploited Texas’ fragmented marketplace for anesthesiology providers.
The FTC grievance says that Welsh Carson sought to make USAP the dominant provider in Texas by hoovering up the various independent practices that previously competed against each other, keeping prices lower.
Welsh Carson and USAP engaged in what the businesses called a “roll-up,” buying nearly every large anesthesia practice in Texas, in line with the grievance.
Since 2013, USAP has grown from 400 anesthesia providers at 45 health-care facilities to 4,500 providers at 1,100 facilities in 2021.
USAP has established monopoly power in Houston and Dallas, the 2 largest cities in Texas, and a dominant position in Austin, the state’s capital, in line with the grievance.
The corporate has used its dominance to boost prices, raking in tens of thousands and thousands of dollars, the FTC alleges.
USAP is so powerful in Austin, Dallas and Houston that it might probably raise prices while still gaining market share since it is difficult for competitors to enter the market, and patients typically cannot forgo anesthesia, in line with the grievance.
Dr. Derek Schoppa, a USAP board member, told CNBC that the FTC’s grievance relies on flawed legal theories and an absence of medical understanding about anesthesiology.
“The FTC’s intended end result threatens to disrupt and restrict patients’ equitable access to quality anesthesia care in Texas and can negatively impact the Texas hospitals and health systems that provide care in underserved communities,” Schoppa said in a press release.