What Physicians Need to Know About Non-Competes

If you are a doctor looking at a new job, there is a good chance a non-compete clause is hidden in your contract. These restrictions can control where you practice and for how long. They could cost you over $50,000 in legal fees if you try to leave.

Understanding the Basics

A non-compete clause limits where you can practice medicine after you leave a job. It sets a distance and a time period. Here are the typical terms:

• Geographic radius: 5-50 miles from employer locations
• Duration: 1-3 years after termination
• Scope: May cover all medical practice or be specialty-specific

State-by-State Variations

Whether a non-compete can be enforced depends a lot on which state you are in:

• California, North Dakota, Oklahoma: Usually not enforced
• Colorado: Banned for workers earning under $123,750
• Texas, Florida: Heavily enforced with strong employer protections
• Most states: Enforceable if "reasonable"

Key Terms to Negotiate

1. Radius Limits

In cities, a 25-mile radius could cover dozens of hospitals. Ask for a smaller radius or limits tied to specific locations instead of a broad area ban.

2. Carve-Outs

Negotiate exceptions for:

• Academic/teaching positions
• Telehealth services to patients outside the restricted area
• Temporary or substitute work
• Employment at specific named institutions

3. Buyout Options

Some contracts let you pay a fee to get out of the non-compete. Make sure the dollar amount is written clearly upfront. Vague wording like "reasonable amount" leads to fights later.

4. When It Kicks In

Make sure the non-compete only applies if you quit on your own. If you get fired or laid off, the restriction should not apply.

Red Flags in Physician Contracts

• Non-compete applies even if employer terminates you without cause
• Radius measured from "any employer location" (could grow over time)
• Damages clause specifying $100,000+ penalties
• A patient non-solicitation rule that stops you from contacting any former patients