Ban on Noncompete Agreements Has Implications for Healthcare Workers

The Federal Trade Commission (FTC) has announced a ban of noncompete agreements in virtually all US employment contracts, which will impact healthcare workers, including surgeons. The FTC voted 3-2 to issue corresponding regulations that would go into effect 120 days after publication of the rule in the Federal Register. 

The FTC estimates that banning noncompete agreements will result in reduced healthcare costs of between $74 billion and $194 billion in the next decade while increasing worker earnings. It is suggested that the ruling may allow physicians flexibility in changing their employment location more easily without uprooting them from their communities or even states of practice.

The ruling aligns with the College’s 2023 letter, sent during the public comment period after the ban was initially proposed, which highlighted that noncompete agreements can have a detrimental affect on patient care by affecting their access to the best surgeons, as well as on the ability of surgeons to seek their optimal work environment and for hospitals to compete for employment of well-suited surgeons.

After the ruling, Patricia L. Turner, MD, MBA, FACS, ACS Executive Director & CEO, sent a communication to members that explained the situation and the College’s support, noting:

“The ACS applauds this vote, however, there remain significant questions regarding the FTC’s jurisdiction over nonprofit entities, including nonprofit hospitals. Some experts question whether the FTC has the jurisdiction to issue this ban at all. The US Chamber of Commerce has already filed suit in court in an effort to block these regulations from being implemented.

“The ACS will continue to aggressively advocate for legislation that would ban noncompete clauses. We must limit the increasing control that large corporations have on the healthcare system and the resulting negative impact on our members and the physician/patient relationship,” Dr. Turner said.

You can play an important part in advancing this ruling. Urge your Members of Congress to support legislation banning noncompete clauses by visiting surgeonsvoice.org.