Berks County Medical Society Medical Record Fall 2019 - 38

m E d i C a l r E C o r d F E at u r E

Physician Non-Compete
Restrictions
by Karen E. Davidson

T

he legal landscape for non-compete restrictions has been
undergoing change. Legislatures and courts have been
taking a renewed look at these restrictions, and in some
cases aggressively limiting the type and scope of non-competes
including those for physicians. While limitations are springing
up, non-competes continue to be valid in most states. As a result,
physicians must still be mindful and strategic when entering into
contracts containing non-compete clauses.

What is a Non-Compete?
Non-competes are a type of contract provision known as a
restrictive covenant which can apply during employment and
after employment ends. Non-competes are designed to restrict
physicians from competing by precluding them from working
for a competitor, or setting up a competing medical practice,
usually for a specified time period after employment ends within
a designated geographic area.

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Most physicians are familiar with non-compete restrictions
having either agreed to such a restriction in an employment
contract or having sought to impost such a restriction as a
business owner to protect their medical practice. The unfortunate
nature of non-competes is that they can have a significant impact
on the professional and personal lives of physicians because they
can preclude a physician from working for a desired employer
in a preferred locale and cause a physician to have to move a
residence with family in tow.
Contract provisions for physician non-competes are multifaceted. One feature is a description of the restricted activity
which can range from the practice of medicine or specialty to,
more broadly, any activity including consulting or administrative
services (e.g., medical directorship) and/or ownership of a
practice or facility. Another aspect of non-competes is the
duration of the restriction which typically ranges from one to
two years. Some non-competes identify restricted competitors by
name. One of the most critical features of non-competes is the
designation of the restricted geographic area which may be based


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Berks County Medical Society Medical Record Fall 2019

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