Federal Antitrust Enforcement in Health Care: 2023 Year in Review – Part 1

Health Highlights

Editor’s Note: The article below is the first in our three-part series, Federal Antitrust Enforcement in Health Care: 2023 Year in Review.  The series is based on our recent webinar, 2023 Health Care Enforcement Trends: Spotlight on Consumer Protection, Antitrust and Fraud. Click here to view the free webinar on demand.

Antitrust enforcement in health care remained a high priority for the enforcers at the U.S. Department of Justice Antitrust Division and the Federal Trade Commission in 2023. All participants in the health care industry—from providers to patients, and payers to pharmaceutical and device manufacturers—should expect vigorous antitrust enforcement by the Biden Administration in the coming election year, as it continues its efforts to address the claim in the President’s July 2021 Executive Order that “Americans are paying too much for prescription drugs and health care services.”1

Indeed, on October 26, 2023, Deputy Assistant Attorney General Andrew Forman of the Antitrust Division gave a public speech explaining that for antitrust enforcers, “there is no more important question than what can we do to safeguard competition in the health care industry.”2 At the same conference, FTC Commissioner Alvaro Bedoya struck a similar tone, discussing the “multiple tools” the FTC has to address claims of anticompetitive conditions in health care markets.3

Consistent with these messages, the FTC and DOJ were very active in health care in 2023, challenging mergers, pursuing conduct matters and changing the health care policy landscape. Based on the year that was, aggressive enforcement and boundary-pushing by federal antitrust enforcers will be themes in the year to come.

Our three-part series of Manatt newsletters will explore those trends. First up, challenges to provider and payer mergers.

Merger challenges

In 2023, the FTC and DOJ invested significant resources to challenge proposed mergers and unwind consummated mergers in the health care industry through both administrative and federal court actions. Particularly towards the end of the year, that investment paid off for the Commission, with multiple mergers blocked.

  1. Provider mergers

    John Muir Health/Tenet Healthcare. In November 2023, the FTC and State of California filed a lawsuit in the Northern District of California to stop the $142 million acquisition of San Ramon Regional Medical Center by its 49 percent owner, John Muir Health, from its majority owner Tenet Healthcare.4 The FTC and the state alleged that John Muir and San Ramon were direct competitors in the I-680 corridor near Walnut Creek, California, and that elimination of their competition would cause insurers to pay higher rates and patients to pay higher premiums and out-of-pocket costs in an already concentrated hospital market.5 In December 2023, the parties abandoned the transaction, noting that “the significant investment of time and money required to litigate can be better spent on other initiatives within our health systems and in support of our joint venture.”6

    Louisiana Children’s/HCA.  In a highly-watched case testing the interaction between federal pre-merger notification law and state certificate of public advantage laws, the FTC unsuccessfully sued to enjoin Louisiana Children’s Medical Center from integrating three hospitals it acquired from HCA Healthcare.7 A court in the Eastern District of Louisiana rejected the FTC’s assertion that the parties should have filed a premerger notification of the transaction pursuant to the HSR Act.8 The court held that because Louisiana’s Department of Justice had issued a Certificate of Public Advantage for the transaction, the state action doctrine exempted the transaction from federal antitrust laws, including the premerger filing requirements of the HSR Act.9 In a surprising move, the FTC did not appeal, especially after its 2022 policy paper asserting that COPA agreements can lead to higher prices and reduced quality.10

    Welsh Carson/U.S. Anesthesia Partners. In September 2023, the FTC filed a complaint in the Southern District of Texas against U.S. Anesthesia Partners Inc. (USAP) and private equity firm Welsh Carson, claiming that the companies’ consolidation of anesthesiology practices in Texas through a series of small transactions, or “roll up,” constituted a multi-year, anticompetitive scheme to create a single dominant provider.11 The complaint alleges defendants entered price-setting agreements with remaining independent practices and a deal to exclude a competitor from USAP’s territory.12 In November 2023, the parties moved to dismiss the FTC’s case, claiming that the FTC had no authority to challenge long-completed acquisitions in a direct federal court action (untethered from an administrative proceeding) and that the series of transactions was good for consumers.

  2. Payer mergers

    UnitedHealth/Change. In a vertical merger challenged at the appellate level, the Antitrust Division appealed the district court’s rejection of its case to block UnitedHealth’s acquisition of health care analytics company Change Healthcare, noting that “Protecting competition and access to affordable health care is of the utmost importance to the Antitrust Division and the Department of Justice.”13 In March 2023, however, the Antitrust Division dropped its appeal.14

1 Executive Order on Promoting Competition in the American Economy (July 9, 2021) (“it is the policy of my Administration to enforce the antitrust laws to combat the excessive concentration of industry, the abuses of market power, and the harmful effects of monopoly and monopsony — especially as these issues arise in … health care markets (including insurance, hospital, and prescription drug markets)”), available at https://www.whitehouse.gov/briefing-room/presidential-actions/2021/07/09/executive-order-on-promoting-competition-in-the-american-economy/.

2 Deputy Assistant Attorney General Andrew J. Forman Delivers Remarks to Capitol Forum: Health Care Competition Conference (Oct. 26, 2023), available at https://www.justice.gov/opa/speech/deputy-assistant-attorney-general-andrew-j-forman-delivers-remarks-capitol-forum-health.

3 The Capitol Forum, Fireside Chat with FTC Commissioner Alvaro Bedoya (Oct. 26, 2023), available at https://www.youtube.com/watch?v=VkQCHB1IVrY.

4 Press Release, Fed. Trade Comm’n, FTC Sues to Block John Muir Health’s Takeover of San Ramon Regional Medical Center (Nov. 17, 2023), available at https://www.ftc.gov/news-events/news/press-releases/2023/11/ftc-sues-block-john-muir-healths-takeover-san-ramon-regional-medical-center.

5 Complaint at 1-2, Dkt. 1, FTC v. John Muir Health, No. 3:23-cv-05952 (N.D. Cal. Nov. 17, 2023), available at, https://www.ftc.gov/system/files/ftc_gov/pdf/2310054johnmuirtenetpicomplaint.pdf.

6 Press Release, John Muir Health, Statement Regarding San Ramon Regional Medical Center Acquisition by John Muir Health (Dec. 15, 2023), available at, https://www.johnmuirhealth.com/about-john-muir-health/press-room/Press-releases/2023-12-18-statement-regarding-san-ramon-regional-medical-center-acquisition-by-john-muir-health.html; Press Release, Fed. Trade Comm’n, Statement Regarding the Termination of John Muir’s Takeover of San Ramon Regional Medical Center from Tenet Healthcare (Dec. 18, 2023), available at, https://www.ftc.gov/news-events/news/press-releases/2023/12/statement-regarding-termination-john-muirs-takeover-san-ramon-regional-medical-center-tenet (“The FTC has scored another major health care win in less than a month, delivering patients in California continued access to quality, affordable health care services.”).

7 Press Release, Fed. Trade Comm’n, FTC Sues to Stop the Potentially Illegal Integration of New Orleans Area Hospitals Over Failure to Follow Federal Reporting Law (Apr. 20, 2023), available at https://www.ftc.gov/news-events/news/press-releases/2023/04/ftc-sues-stop-potentially-illegal-integration-new-orleans-area-hospitals-over-failure-follow-federal-reporting-law.

8 Order & Reasons, Dkt. 92, Louisiana Children’s Medical Ctr. v. Attorney General, No. 2:23-cv-01890 (E.D. La. Sept. 27, 2023), available at, https://www.courtlistener.com/docket/67223260/92/louisiana-childrens-medical-center-v-attorney-general-of-the-united/.

9 Id.

10 Press Release, Fed. Trade Comm’n, FTC Policy Paper Warns About Pitfalls of COPA Agreements for Patient Care and Healthcare Workers (Aug. 15, 2022), available at https://www.ftc.gov/news-events/news/press-releases/2022/08/ftc-policy-paper-warns-about-pitfalls-copa-agreements-patient-care-healthcare-workers.

11 See Complaint, FTC v. U.S. Anesthesia Partners, Inc., No. 4:23-cv-03560 (S.D. Tex. Sept. 21, 2023), available at https://www.ftc.gov/system/files/ftc_gov/pdf/2010031usapcomplaintpublic.pdf.

12 See id. at ¶¶ 4-8.

13 Press Release, Antitrust Div., Statement from Assistant Attorney General Jonathan Kanter on the District Court’s Decision in U.S. v. UnitedHealth Group and Change Healthcare (Sept. 19, 2022), available at https://www.justice.gov/opa/pr/statement-assistant-attorney-general-jonathan-kanter-district-court-s-decision-us-v.

14 Stipulation of Voluntary Dismissal, Doc. 1990806, U.S. v. UnitedHealth Group, No. 22-5301 (D.C. Cir. Mar. 20, 2023).



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