Doctor Employment Lawyer Blog

While you may think that the non-compete provision in your employment agreement is just a standard term that can be addressed when the time comes for you to move on, it is in fact a powerful tool to restrict you from practicing medicine in a specified geographic area.

Earlier this week it was reported on the Indianapolis Business Journal at IBJ.com that Indiana University (IU) Health Morgan Hospital has file suit against a primary care physician alleging that she signed a non-compete agreement with the hospital, and that she is now attempting to breach that agreement by moving her practice to Franciscan St. Francis Health. IU Health is seeking a preliminary injunction to stop the physician's move.

Even when a non-compete is unenforceable, being sued by a hospital with deep pockets is a strong deterrent to violation. Litigation can, and often does, take years. When accepting a new position, many physicians don't even contemplate the possibility that their employment agreement might interfere with future employment options.

Many of the physicians we work with do not believe that the employer who is hiring them might someday sue them for trying to leave. Before you sign a physician employment agreement, if the hospital or practice group tells you "we never enforce those provisions," ask them to put that in the agreement.

Last week on Becker's ASC Review website, Rob Kurtz published an article, 7 Predictions From ASC Physicians on the Future of Surgery Center Physician Ownership, presenting the perspective of seven Ambulatory Surgical Center physician owners on the issue of the hospital acquisition trend and whether owners believe they will maintain ownership five years from now.

Most of the physicians are adamant in their belief that they will maintain ownership and the trend will not affect them. In support of the argument, most of the physician owners do not identify reasons will not continue to gobble up private practices, but instead cite reasons why hospitals do not do as good of a job operating surgery centers. They cite quality of care and bureaucracy as downsides of hospital owned surgery centers.

One of the surgeons, Kenneth Pettine, MD, cites to a historical trend of hospitals viewing a private practice surgery center as a money maker, but fail to realize that the reason the center is making money is because the physicians are working 60-80 hours per week. Dr. Pettine believes that hospital employed surgeons would be less willing to maintain such a schedule when they have a guaranteed salary, an ability to work less hours or get more involved with committees.

Another physician, Joshua A. Siegal, MD, is the only physician that seems that surgery centers may have to partner with hospitals to "create growth and economies of scale." Dr. Siegal points out that "healthcare will be required to show efficacy in outcomes and value for its costs."

Regardless of the opinions, electronic medical records, delayed and reduced reimbursements, and regulations are all making it more and more difficult for physicians to sustain independent practice groups. And hospitals are gobbling them up. Physicians need to be prepared for all possibilities here.