DOCTORS AND NON-COMPETES: A PENDING CASE

We have written numerous blogs on non-competition agreements signed by doctors and other health care professionals (use the search feature above to read those blogs).

I just ran across another report of doctors facing the prospect of not being able to care for their patients due to a non-compete agreement signed with the physician’s practice group. Dr. Ves Caperton is a 59 year old doctor practicing in Caperton, Texas. Dr. Caperton is one of approximately 25 doctors formerly with Sadler Clinic who may eventually form their own group practice. He resigned from Sadler Clinic, citing philosophical differences with clinic management.

Whether Dr. Caperton can remain in the area and continue to provide medical care to his patients depends on the outcome of a lawsuit filed by one of his doctor/colleagues at the Sadler Clinic. Former Sadler Clinic physician Nora Catherine Hart is challenging the clinic’s non-compete agreement, which prohibits former doctors from practicing medicine for 18 months within a 22-mile radius of the clinic’s primary facility adjacent to the Conroe Regional Medical Center in Conroe, Texas.

Virginia law recognizes a “public interest exception” to the enforceability of non-compete contracts…whether you are a doctor or otherwise. The exception provides that non-compete agreements will not be enforced when to do so would harm the “public interest.” I don’t know about you but I think the restriction of the provision of needed health care runs contrary to the “public interest.”

The Texas court should also be aware of the American Medical Association’s position on non-compete agreements and doctors. The following AMA ethical opinion discourages the use of restrictive covenants in physician contracts:

E-9.02 Restrictive Covenants and the Practice of Medicine

Covenants-not-to-compete restrict competition, disrupt continuity of care, and potentially deprive the public of medical services. The Council on Ethical and Judicial Affairs discourages any agreement which restricts the right of a physician to practice medicine for a specified period of time or in a specified area upon termination of an employment, partnership, or corporate agreement. Restrictive covenants are unethical if they are excessive in geographic scope or duration in the circumstances presented, or if they fail to make reasonable accommodation of patients’ choice of physician.

My Take: The provision of health care should never be restricted or limited by non-compete contracts….the public deserves affordable and accessible health care.

Dan Frith

Dan Frith

Dan Frith has over 25 years of experience representing individuals and families in cases of medical malpractice throughout Virginia. He has been named "Best Medical Malpractice Attorney" by Roanoker Magazine and is a member of the Million Dollar Advocates Forum. To speak with Dan, contact him by email at dfrith@frithlawfirm.com.