U.S. Anesthesia Partners Lawsuit: FTC Case and Class Actions

The U.S. Anesthesia Partners lawsuit is a federal antitrust case the Federal Trade Commission filed in September 2023, accusing USAP and private equity firm Welsh, Carson, Anderson & Stowe of buying up independent anesthesia practices across Texas over a decade to raise prices by tens of millions of dollars a year. As of mid-2026, the FTC and USAP have reached a preliminary settlement whose terms remain confidential, Welsh Carson has separately agreed to a ten-year consent order, and two private class actions against USAP are still in discovery in the Southern District of Texas.

What the FTC Accused USAP of Doing

The Commission sued USAP and Welsh Carson on September 21, 2023, in the U.S. District Court for the Southern District of Texas, alleging monopolization, conspiracy to monopolize, unlawful acquisitions, and unfair methods of competition under the FTC Act and Clayton Act. The relevant market was defined as commercially insured hospital-only anesthesia services in Houston, Dallas-Fort Worth, and Austin.¹

Welsh Carson created USAP in late 2012 to consolidate the fragmented Texas anesthesia market, starting with Greater Houston Anesthesiology, a practice with more than 400 providers serving over 40 facilities.² From there, USAP acquired more than a dozen practices between 2012 and 2019, including at least seven in Dallas and Pinnacle Anesthesia Consultants, which at the time performed roughly 40% of anesthesia services in Dallas.³

According to the FTC, USAP built and maintained its position through three mechanisms:

Serial acquisitions of competing practices in the same metro areas, followed by raising the acquired groups’ insurance reimbursement rates up to USAP’s higher rates. Internal documents described the resulting price increases as “synergies.”¹
Price-setting arrangements with independent groups USAP could not buy, under which USAP billed insurers at its own higher rates for work performed by the other groups and split the extra revenue. USAP executives internally called the arrangements “odd from a compliance standpoint.” The FTC named agreements with Methodist Hospital Physician Organization, Dallas Anesthesiology Associates, and Baylor College of Medicine.¹
A market-allocation deal with Envision Healthcare, which the FTC alleged paid Envision $9 million per year from 2014 to 2019 to stay out of USAP’s Dallas territory.⁴

By 2021, the FTC alleged, USAP was four times larger than the next Houston group, six times larger than the next Dallas group, and nearly seven times larger than any other Texas competitor. Texas accounted for about 65% of the company’s profit, and its reimbursement rates ran roughly double the median for other Texas anesthesia providers. The Commission estimated the scheme cost Texans “tens of millions of dollars more each year.”⁵

Independent research reached similar findings. A University of Chicago Becker Friedman Institute study found that while USAP’s initial platform acquisitions did not push up prices, each subsequent add-on acquisition of a competitor was followed by an 18% price increase within six months and a 25% to 30% increase within two years, with no measurable improvement in quality or outcomes.⁶

Where the Case Stands Now

On April 23, 2026, the FTC announced that it had reached an agreement in principle with USAP to settle the federal court case, with the Commission voting 2-0 to authorize the preliminary settlement. The terms remain confidential while USAP works through the steps needed to execute the deal, and the FTC has said it will return to court to litigate if USAP fails to complete those steps. The agency described the settlement as aimed at restoring “a competitive market structure” in Texas anesthesia markets.⁷

The parties jointly moved to stay the litigation the same day. Judge Kenneth M. Hoyt granted the stay on May 26, 2026. Any final settlement order will need another Commission vote and district court approval before it takes effect.⁸

The preliminary settlement came after Judge Hoyt refused to throw out the FTC’s case against USAP in May 2024. The court found that USAP “continues to own the anesthesia groups it unlawfully acquired” and that its scheme remained “intact,” so maintaining assets acquired through anticompetitive means qualifies as an ongoing violation for purposes of Section 13(b) of the FTC Act. The judge also rejected USAP’s challenge to the market definition and its constitutional challenge to the FTC’s structure.⁹ The Fifth Circuit later dismissed USAP’s interlocutory appeal for lack of jurisdiction in August 2024, leaving those arguments to be raised, if at all, after any final judgment.¹⁰

What Happened to Welsh Carson

Welsh Carson took a different path out of the case. In the same May 2024 ruling that kept USAP in court, Judge Hoyt granted Welsh Carson’s motion to dismiss, finding that its 23% minority stake and two of fourteen board seats did not establish that the firm “is violating, or is about to violate” the antitrust laws, as Section 13(b) requires. Profits still flowing from past acquisitions, the court wrote, “are not treated as independent acts.” The judge declined to extend Sections 7 and 13(b) to reach a “minority, noncontrolling investor.”⁹¹¹

The FTC then pursued Welsh Carson through a separate administrative proceeding. The Commission accepted a consent order on January 17, 2025, by a 5-0 vote and approved the final order on May 20, 2025, after a public comment period.¹² The order runs for ten years and imposes three main restrictions on the firm:

Welsh Carson must freeze its current ownership stake in USAP, cut its board representation to a single non-chair seat, and let USAP terminate service contracts with the firm without penalty.¹³
Welsh Carson and its funds must obtain FTC approval before investing in or acquiring any anesthesia business anywhere in the United States.¹³
The firm must give the FTC advance notice and wait 30 days before investing in other hospital-based physician groups, such as emergency medicine, radiology, or neonatology practices, in markets where it already holds a controlling interest.¹³

FTC Chairman Andrew Ferguson concurred in the settlement but pushed back on framing it as a novel strike against private equity, calling the case a “routine law-enforcement matter” and an “ordinary application of the most elementary antitrust principles.” He said private equity status neither earns special treatment nor provides a “free pass.”¹⁴

Private Class Actions Against USAP

Two private class actions in the Southern District of Texas are running alongside the FTC case, and they are not affected by the FTC’s preliminary settlement.

Electrical Medical Trust v. USAP

Filed November 20, 2023, this suit was brought by the Electrical Medical Trust and Plumbers Local Union No. 68 Welfare Fund, both self-funded employee benefit plans based in Houston. They allege Sherman Act and Clayton Act violations and seek damages for payors charged inflated rates for hospital-only anesthesia services in Texas.¹⁵ The complaint alleges USAP controlled roughly 57% of the Texas hospital-only anesthesia market and 73% across the combined Austin, Dallas, and Houston markets, with rates nearly 40% above the average of other Texas providers.¹⁶ Welsh Carson entities were named but have since been dismissed. The case is in discovery, with a fact discovery deadline of August 14, 2026, and a class certification motion expected.

Burbage v. USAP

A second class action, now captioned Burbage v. U.S. Anesthesia Partners Inc. and originally filed under the name Musharbash, is before Judge Alfred H. Bennett. Christy Burbage brings similar Sherman Act and Clayton Act claims but pushes the case into an area neither the FTC nor the Electrical Medical Trust suit reached: anesthesia services at ambulatory surgical centers.¹⁷ USAP moved to dismiss the ambulatory surgical center claims on the grounds that Burbage was treated at a hospital and lacks standing for those claims, and that the claims are time-barred under the Clayton Act’s four-year statute of limitations.¹⁸ The court granted the motion in part, and the remaining claims are in discovery under the same August 2026 fact cutoff.

Why the Case Matters Beyond USAP

Many of USAP’s individual acquisitions fell below the reporting thresholds under the Hart-Scott-Rodino Act, so no single deal triggered mandatory federal antitrust review. The FTC called this “stealth consolidation” and argued that the cumulative effect of the deals substantially reduced competition even though each was too small to attract scrutiny on its own.⁶

The Welsh Carson consent order gives the agency a template. It reaches across an entire sector nationally, not just the Texas markets where the alleged harm occurred, and the FTC described it as designed to account for the “complex maze of related entities and funds” that private equity firms use.¹³

Judge Hoyt’s dismissal set a limit in the other direction. The FTC could not use Section 13(b) to keep a minority, noncontrolling investor in federal court based on past participation in an anticompetitive scheme. That gap between what the FTC could win administratively and what it could sustain in court is likely to shape how the agency structures future roll-up cases against private equity firms.

1
FTC.gov. FTC Complaint for Injunctive and Other Equitable Relief
2
PE Professional. Welsh Carson Acquires Greater Houston Anesthesiology
3
FTC.gov. FTC Administrative Complaint Against Welsh Carson
4
Georgetown Law Litigation Tracker. FTC Opposition to Welsh Carson Entities Motion to Dismiss
5
FTC.gov. FTC Challenges Private Equity Firms Scheme to Suppress Competition in Anesthesiology Practices Across Texas
6
University of Chicago Becker Friedman Institute. Painful Bargaining: Evidence From Anesthesia Rollups
7
FTC.gov. FTC Charts Path to Restore Competition in Texas Anesthesia Markets in USAP Litigation
8
Georgetown Law Litigation Tracker. Federal Trade Commission v. U.S. Anesthesia Partners Inc. et al.
9
Georgetown Law Litigation Tracker. Memorandum Opinion and Order, May 13, 2024
10
Bloomberg Tax. U.S. Anesthesia Partners Appeal of FTC Suit Tossed by Fifth Circuit
11
Holland & Knight. Private Equity Firm Welsh Carson Dismissed From FTC Antitrust Action
12
FTC.gov. FTC Approves Final Order for Welsh Carson
13
Federal Register. Welsh, Carson, Anderson and Stowe; Analysis of Agreement Containing Consent Order to Aid Public Comment
14
FTC.gov. Concurring Statement of Commissioner Andrew N. Ferguson
15
Georgetown Law Litigation Tracker. Electrical Medical Trust et al. v. U.S. Anesthesia Partners Inc. et al.
16
Applied Antitrust. Electrical Medical Trust Class Action Complaint
17
Georgetown Law Litigation Tracker. Burbage v. U.S. Anesthesia Partners Inc. et al.
18
Georgetown Law Litigation Tracker. Defendants Motion to Dismiss in Burbage v. USAP