Physician Noncompete Agreements Contribute To Physician Shortages: One of the tried and true arguments that the health care industry promotes to advance their medical malpractice tort reform efforts before state legislatures that protect the financial interests of heath care providers at the expense of the most severely injured medical malpractice victims is that without such protections, there will be shortages of physicians in their jurisdictions because physicians will move their practices to more favorable tort reform states.
An often overlooked significant contributor to physician shortages in many locations is the effect of noncompete agreements that physicians are required to sign with large prospective employers, such as hospital systems.
The American Academy of Family Physicians (AAFP) recently addressed this issue and stated on its website: “Family physicians nationwide … have spoken out against noncompete agreements, which force physicians to stay in undesirable employment situations while limiting their financial prospects and compromising their mental health. Obviously, that’s also bad for patients.
That’s why we took this opportunity to urge passage of legislation banning noncompete clauses in physician employment contracts. It’s simple: Patients should have access to their physicians, and physicians should be able to freely practice in their communities.
This is part of our workforce advocacy you can take part in right now by joining the AAFP’s newest Speak Out campaign, centered on raising congressional support for a proposed Federal Trade Commission rule banning non-compete clauses. Getting this done would swiftly improve continuity of care for patients and allow more family physicians to work freely in their communities.“
The AAFP Speak Out campaign states, in part: “Family physicians from across the country have long expressed concerns about how noncompete agreements in physician employment contracts adversely impact their practice and patients. Now, the Federal Trade Commission (FTC) has proposed a rule to ban noncompete clauses in employment agreements. The AAFP strongly supports this proposed rule, which would ensure patients have continued access to their physicians and would allow physicians to freely practice medicine in their communities.
Noncompete agreements in health care employment impede patient access to care and disrupt care continuity, deter advocacy for patient safety, limit physicians’ ability to choose their employer, and stifle competition. Despite well-documented physician shortages, many health care employers still intentionally restrict physician mobility and workforce participation via noncompete agreements.”
As of 2020, 49.1% of physicians delivered care in independent practices wholly owned by physicians, according to the 2020 American Medical Association (AMA) Physician Practice Benchmark Survey. Among AAFP members, 24% reported they were sole or partial owners of their practices, while 73% work working as employees. For physicians one to seven years post-residency, 91% were employed physicians, while in 2011, 59% of AAFP members reported being employed, according to the AAFP.
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