Consulting legal counsel to review a physician’s employment agreement before a dispute arises may increase a doctor’s negotiating power and help obtain better working conditions. Employment agreements contain many provisions, which may include: compensation arrangements, arbitration clauses, terms defining the scope of liability insurance, and non-compete agreements. As physicians in the workplace are tending to move away from working in solo practices, we are finding that hospital, health system and other corporate employment agreements containing non-compete clauses are becoming more prevalent.
The American Medical Association advises against physicians entering into restrictive non-compete agreements, saying that they “can disrupt continuity of care, and may limit access to care.”. While the AMA advises physicians to be cautious about unreasonable restrictions and those that limit patient choice of providers, generally speaking, non-compete agreements have been upheld and determined enforceable in courts. Courts can limit the enforcement of these agreements, however, if they deem the provisions unreasonable or too restrictive. Courts have varied in what they define as unreasonable or overly restrictive, in terms of duration and geographic radius.