Non-compete clauses are being used more in employment agreements. Employment contracts for medical professionals containing these terms, also known as restrictive covenants, may been damaging to patients and pose legal problems for medical practices.
Non-competition clauses are intended to stop healthcare practitioners from taking patients if they work with a competing practice or start one of their own. A survey of 2,000 primary care doctors in five states showed that approximately 45 percent of practitioners were restricted by a non-competition clause.
Continuing care with a health practitioner, especially with patients with ongoing conditions, is important. This has even greater importance than any commercial relationship governed by a non-compete clause. Opponents of non-competition agreements argue that continuing a good therapeutic relationship should be an important consideration.
Generally, these agreements must be reasonable and narrowly drawn to protect the legitimate business interest of a medical practice without overly restricting the practitioner’s ability to engage in their profession. A possible physician shortage in an area may be considered and courts are unlikely to stop a patient from seeing the practitioner that they choose.
The American Medical Association, which advocates for doctors, does not directly oppose non-competition agreements. However, the AMA is concerned that these agreements can interfere with continuity of care and patient choice. The professional licensing laws that govern health practitioners must also be considered.
Supporters of non-competes argue that these are beneficial for patients because these ensure continuity of care and stability within a practice. Patients who follow their caregiver to a new practice may not be accepted because the practitioner’s new employer may respect the legality of those contracts.