Senators call out US Anesthesia Partners for alleged role in anticompetitive scheme

Two U.S. senators say it's time for U.S. Anesthesia Partners and its parent company, Welsh, Carson, Anderson & Stowe, a private equity firm, to pay the piper following the Federal Trade Commission's anticompetitive scheme lawsuit in late September.

In a letter to Robert Coward, CEO of USAP, Sen. Elizabeth Warren of Massachusetts and Sen. Richard Blumenthal of Connecticut are probing what they claim are restrictive noncompete agreements and monopolistic business practices, which have allegedly led to increased prices, suppressed workers' wages and reduced overall patient care quality.

"We have frequently raised the alarm about the deleterious impact of PE on patient care. PE's involvement in health care markets has exacerbated problems like surprise medical billing, inadequate training, and a lack of oversight and due process," the letter says.

With over 4,500 clinicians across nine states since its 2012 launch, USAP purchased Denver's biggest anesthesiology groups in 2015, making it Colorado's largest anesthesiology practice. From there, USAP began raising patient and payer costs, sometimes charging them more than 70% competitor rates, the senators' letter claims. The senators also claim the company used noncompete agreements, with some physicians faced with over $200,000 in "damages" if they attempted to leave.

The letter also points to President Joe Biden's July 9, 2021, Executive Order on Promoting Competition in the American Economy, which works to tackle excessive industry concentration, market power abuse, and harmful effects from healthcare market monopolies and monopsonies.

The FTC and the Justice Department's proposed updated guidelines would also ensure enforcement of antitrust laws, allowing the agencies to conduct full company merger examinations, providing insight and preventing anticompetitive schemes and market power gain.

"We are proud of our investment in USAP, which has allowed independent anesthesiologists to deliver superior clinical outcomes to underserved populations. The FTC's action will harm clinicians and patients at a time of physician shortages," a spokesperson for Welsh Carson said in a September statement to Becker's following the FTC lawsuit. "Moreover, the FTC is ignoring that USAP's commercial rates have not exceeded the rate of medical cost inflation for close to ten years. The FTC's decision to pursue a civil action against a minority investor of a physician-owned company is unprecedented and disregards well-settled principles of law."

Ms. Warren and Mr. Blumenthal have requested USAP's response to a set of questions by Dec. 11, which concern USAP's "troubling use" of price-driven monopoly power. Becker's has reached out to USAP and Welsh Carson for an updated comment on the letter.

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