In today’s competitive medical industry, practitioners may turn to non-compete agreements to protect their business in the event a physician from the practice leaves. These contracts are important to retaining a permanent customer base; however, they must be carefully prepared with the assistance of experienced physicians attorneys in order to be effective.
To prevent the potential damage that may occur after the loss of an essential team member, practice owners should seek physicians contract assistance so their agreements contain the terms that will provide such protection.
What Is A Non-Compete Agreement or Clause?
A non-compete agreement, also called a physician restrictive covenant, is a commitment between a physician and a hiring practice whereby the physician agrees not to compete with that practice if he or she leaves for another employment opportunity.
The purpose of these agreements is to prevent doctors from leaving a service and recruiting patients to a different practice, ultimately reducing the patient base of the initial practice. Non-compete provisions also protect a practice’s critical business and patient information when key employees leave.
What Restrictions Do Non-Compete Agreements Impose?
Non-compete agreements prepared by physicians attorneys typically contain a number of specific and legal employment restrictions that are placed upon the physician who has been hired. By executing the contract when hired, an employee agrees to not practice the type of medicine or services outlined in the arrangement for the agreed upon amount of time, usually within a certain distance from the hiring practice.
For example, a medical business that obtains physicians contract assistance from an attorney familiar with such contracts can state in the contract that the departing employee may not practice a certain specialty or general medicine within a certain number of miles from the service for a designated length of time, whether it is weeks, months, or even years.
The length of time and distance from the service will usually differ based on the type of medicine or specialty practiced and the size of the area from which the business draws its customers. Specialists may have longer restrictions over a more vast area, while general practitioners might have restrictions that prohibit employment within the same town.
Why Are Non-Compete Agreements Important?
Although medical practices must operate within strict federal regulations, they still work like any other business. There are two significant reasons why practice owners should seek physicians contract assistance from an experienced attorney who can draft the appropriate non-compete agreements when hiring key employees, including physicians and certain executive staff members.
Working with experienced physicians attorneys to draft these important contracts protects the medical practice's income. A departing employee would not be able to take existing patients with them to another practice within the same area or region.
These agreements also address patient and business confidentiality, something that every medical practice must comply with.
Non-compete agreements also protect a healthcare provider's reputation. Physicians who sign an agreement, then later attempt to practice medicine without abiding by these restrictions, can be sued for breach of contract.
Non-compete contracts are a legal requirement; however, physicians attorneys often advise that they provide critical legal and financial protection for medical practices and services. Since the specifics of such agreements differ depending on the practice and its location, medical specialty, and other such details, practitioners should seek physicians contract assistance from lawyers who are experienced in the preparation of these types of contracts.
The Stevenson Law Firm, PC
6302 W. Broadway, Suite 120
Pearland, TX 77581
Phone: (832) 481-4548