WASHINGTON, D.C. — The Federal Trade Commission (FTC) reached a settlement with private equity firm Welsh, Carson, Anderson, and Stowe (Welsh Carson) that resolves allegations of anticompetitive behavior in the anesthesiology services market. The settlement, marked by a proposed consent order, addresses claims that Welsh Carson, through its portfolio company U.S. Anesthesia Partners (USAP), orchestrated large-scale acquisitions to suppress competition and raise prices across Texas.
The FTC’s complaint accused Welsh Carson of creating USAP in 2012 as part of a “roll-up scheme,” where nearly all major anesthesia practices in Texas were systematically acquired to form a dominant provider. This market consolidation allegedly enabled USAP to charge higher prices for anesthesiology services, harming both patients and healthcare providers.
FTC Chair Lina M. Khan previously emphasized the broader implications of such actions, stating the Commission would remain vigilant in ensuring markets remain competitive and fair.
The enforcement effort against Welsh Carson comes after an earlier legal setback in May 2024, when a federal court dismissed the firm from the FTC’s case over procedural inadequacies under Section 13(b) of the FTC Act. Despite that dismissal, the case against USAP continues in federal court. The current settlement allows the FTC to avoid administrative court proceedings against Welsh Carson while ensuring safeguards are in place to prevent further anticompetitive conduct.
The proposed consent order requires several key measures to limit Welsh Carson’s future influence and ensure fair competition:
- Limit Control Over USAP: Welsh Carson must freeze its investment in USAP at current levels and reduce its board representation to a single, non-chair position, curbing its ability to direct USAP’s operations or benefit from its monopoly position in Texas.
- National Prior Approvals: The agreement mandates that Welsh Carson seek prior FTC approval for any future investments in anesthesia services or for acquisitions involving majority-owned anesthesia groups.
- Transaction Notifications: The firm must provide at least 30 days’ notice before engaging in transactions involving other hospital-based physician practices nationwide.
This settlement underscores the FTC’s commitment to challenging anticompetitive practices, even when procedural hurdles arise. “If necessary, the Commission will bring suit in administrative court to protect consumers from anticompetitive conduct,” the FTC stated, signaling its enduring resolve to hold companies accountable.
The case serves as a warning to private equity firms and corporations considering similar market-consolidating strategies, reaffirming the FTC’s vigilance in protecting consumer interests and maintaining competitive markets in the healthcare sector. The ongoing federal challenge against USAP further highlights the Commission’s broader efforts to address monopolistic practices in essential healthcare services.
For the latest news on everything happening in Chester County and the surrounding area, be sure to follow MyChesCo on Google News and MSN.