Noncompetes Are Once Again Relevant for Recruited Doctors
When the Stark II (Phase III) regulations were released in August, 2007, they clarified that when a hospital recruits a physician to a medical practice, the employment agreement between the medical practice and the newly recruited physician may contain practice restrictions as extended as they do not “unreasonably restrict the recruited physician’s ability to practice medicine within the recruiting hospital’s supply area. This stymied many medical practices which were reluctant to hire a fresh physician without a noncompete and nonsolicitation provision. A 2011 CMS Advisory Belief (No. CMS-AO-2011-01) changed this.
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