2023 Health Care Antitrust Actions: Comprehensive Review Part 1 | Manatt, LLP

TL/DR –

In 2023, the U.S. Department of Justice Antitrust Division and the Federal Trade Commission prioritized antitrust enforcement in health care, challenging mergers and changing health care policies. They challenged several significant provider and payer mergers, including John Muir Health/Tenet Healthcare, Louisiana Children’s/HCA, and Welsh Carson/U.S. Anesthesia Partners for provider mergers, and UnitedHealth/Change for payer mergers. The FTC and DOJ have also emphasized that safeguarding competition in the health care industry is a significant concern for them.

2023 Review: Vigorous Antitrust Enforcement in Health Care Sector

In 2023, antitrust enforcement in the health care sector was a focal point for the U.S. Department of Justice Antitrust Division and the Federal Trade Commission (FTC). The Biden Administration aimed to address the high costs of prescription drugs and health care services, as outlined in the July 2021 Executive Order. All stakeholders, including providers, patients, payers, and pharmaceutical and device manufacturers, witnessed this rigorous scrutiny.

Andrew Forman, Deputy Assistant Attorney General of the Antitrust Division, emphasized the significance of safeguarding competition in the health care industry during his public speech on October 26, 2023. FTC Commissioner Alvaro Bedoya echoed these sentiments, underscoring the FTC’s toolkit to address anticompetitive conditions in health care markets.

The FTC and DOJ aggressively monitored health care in 2023, which included challenging mergers, pursuing conduct matters and reshaping the health care policy landscape. This article is part of a series exploring such trends, starting with challenges to provider and payer mergers.

Merger Challenges

The FTC and DOJ deployed significant resources in 2023 to challenge proposed and consummated mergers in the health care sector through administrative and federal court actions. This investment reaped benefits towards the year-end, with multiple mergers being obstructed.

1. Provider Mergers

   In November 2023, the FTC and the State of California filed a lawsuit against the $142 million acquisition of San Ramon Regional Medical Center by John Muir Health from its majority owner, Tenet Healthcare. The FTC claimed that the merger would lead to higher rates for insurers and increased premiums and out-of-pocket costs for patients. The parties abandoned the transaction in December 2023, citing the extensive resources required for litigation.

   In a closely watched case, the FTC unsuccessfully attempted to halt Louisiana Children’s Medical Center from integrating three hospitals it purchased from HCA Healthcare. The court rejected the FTC’s claim that the parties should have filed a premerger notification, citing a state action doctrine exemption.

   The FTC filed a complaint against U.S. Anesthesia Partners Inc. (USAP) and private equity firm Welsh Carson in September 2023. The FTC claimed that the companies’ consolidation of anesthesiology practices in Texas constituted an anticompetitive scheme to create a dominant provider. The case remains ongoing.

2. Payer Mergers

   In an unprecedented vertical merger challenge, the Antitrust Division appealed to block UnitedHealth’s acquisition of health care analytics company Change Healthcare. However, the appeal was dropped in March 2023 for undisclosed reasons.

The links below provide further reference to statements and actions mentioned in this article:

1. Executive Order on Promoting Competition in the American Economy (July 9, 2021)
2. Remarks by Deputy Assistant Attorney General Andrew J. Forman (Oct. 26, 2023)
3. Fireside Chat with FTC Commissioner Alvaro Bedoya (Oct. 26, 2023)
4. Press Release on John Muir Health/Tenet Healthcare lawsuit (Nov. 17, 2023)
5. Statement from Assistant Attorney General Jonathan Kanter on U.S. v. UnitedHealth Group and Change Healthcare (Sept. 19, 2022)

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