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The End of Non-Competes? The Impact It Will Have on the Healthcare Industry

Client Alert

A. Overview

On January 5, 2023, the Federal Trade Commission (“FTC”) announced a proposed rule that, if enacted, will ban employers from entering into non-compete clauses with workers (the “Rule”), and the Rule would void existing non-compete agreements. In their Notice, the FTC stated that if the Rule were to go into effect, they estimate the overall earnings of employees in the United States could increase by $250 billion to $296 billion per year.[1] The Rule would also require employers to rescind non-competes that they had already entered into with their workers.[2] For purposes of the Rule, the FTC has defined “worker” to also include any employees, interns, volunteers, and contractors.”[3]

B. Providers

This proposed Rule would have a profound effect on the healthcare industry, as many providers, such as physicians, nurse practitioners, and physician assistants have entered into non-competes with their employers, restricting them from working within a certain proximity to their previous employers, usually for a set amount of time following their employment. The rule would also rescind this restrictive covenant that many providers have already entered into with their employers.

While the rule would undoubtedly benefit providers, and even potentially patients, by not restricting where providers can practice, the rule may present difficulties to health systems, including hospitals and clinics, particularly in areas where it is a struggle to find and/or retain healthcare workers, particularly physicians.[4]

The FTC has asked the public to submit comments on the Rule, which will be due sixty (60) days after the Rule is published in the Federal Register.[5]

C. Other Employers

BMD’s employment attorney, Bryan Meek, will be publishing a new podcast episode on his YouTube channel, Employment Law After Hours, during the week of January 9th further discussing these proposed FTC rules and the possible implications on the industry.

If you have any questions regarding this proposed rule or would like to discuss submitting a public comment to the FTC regarding this proposal, please do not hesitate to contact:

[1] Federal Trade Commission, Non-Compete Clause Rulemaking, https://www.ftc.gov/legal-library/browse/federal-register-notices/non-compete-clause-rulemaking (Jan. 5, 2023).

[2] Id.

[3] Id.

[4] Association of American Medical Colleges, “New AAMC Report Confirms Growing Physician Shortage,” https://www.aamc.org/news-insights/press-releases/new-aamc-report-confirms-growing-physician-shortage (June 26, 2020).

[5] Non-Compete Rulemaking.


Recent Litigation Challenges the Affordable Care Act Preventive Services Requirement

The Affordable Care Act (ACA) has been met with numerous legal challenges. The most recent legal challenge, Braidwood Management Inc. v. Becerra, could affect millions of people covered by private health insurance.

340C – Prospective Legislation to Protect Federally Qualified Health Centers

Advocates for Community Health (ACH), an organization created to implement policy and advocacy initiatives for health care systems across the United States, has begun drafting legislation that is geared towards protecting Federally Qualified Health Centers (“FQHCs”) enrolled in the 340B Program, which is being dubbed “340C.”

Getting Paid to Vote

Can you get paid to vote? Election Day is upon us and employees across the country are asking whether they can get paid to vote. Essentially, can they take paid leave of a few hours to go to the polling location to cast their vote in a midterm election or presidential election. Well, it depends on the state where the employee works.

BMD Makes 2023 U.S. News & World Report "Best Law Firms" Edition

Best Law Firms 2023

EEOC’s New “Know Your Rights” Poster to Replace “EEO is the Law” Poster

Under federal law, covered employers are required to post a notice in the workplace describing federal antidiscrimination laws. The Equal Employment Opportunity Commission (EEOC) prepares the mandatory posters summarizing antidiscrimination laws and explaining how employees and applicants can file a complaint if they believe they have experienced job discrimination. On October 19, 2022, the EEOC released a new poster: “Know Your Rights: Workplace Discrimination is Illegal,” replacing the “EEO is the Law” poster. Employers must now use the poster captioned as “Know Your Rights: Workplace Discrimination is Illegal – Revised 10/20/22.” Employers may be reprimanded for failure to appropriately and compliantly post the updated poster.