Q: Can a contract be written so that a good doctor who is not "earning out" can be let go and still be obliged to abide by their non-compete? A: It is possible, but enforceability turns on reasonableness and public interest. If a practice wants the covenant to survive termination for low productivity, define performance with objective, clinical metrics that are fair market value based, for example wRVUs, timely notes, quality and access targets. Avoid pure revenue floors tied to referrals. Build in a notice and cure period plus a remediation plan that documents support offered. Narrow the covenant to specific sites the doctor actually covered, services they actually performed, and a radius grounded in the true referral base. Pair enforcement with consideration such as garden leave pay or severance during the restricted period. Include a blue pencil clause and step-down language so a court can trim scope rather than void the clause. Q: Is there any contract language that helps here? A: Niche care raises a hardship and public access issue. Draft to reduce burden: limit the restriction to competing roles in the same subspecialty rather than all clinical work, cap the radius using a zip code analysis of actual patient origin, and exclude academic, research, telemedicine consults, and hospital-only work that preserves access. Carve out emergency call and time-sensitive pediatric or complex cases. Offer a reasonable buyout amount as an alternative to waiting out the restriction. Add a patient continuity plan that affirms the public interest is protected, for example transfer of active cases and records, which courts often weigh. Q: Any other informed commentary for physician practices? A: Keep the cause narrative consistent. If you terminate without cause, avoid later reframing as for cause to shore up a covenant. Separate pay plans from restrictive covenants to reduce Stark and Anti-Kickback risk, and keep compensation fair market value for services personally performed. Consider whether a narrower non-solicit plus confidentiality gives adequate protection with lower litigation risk. Finally, maintain a clean paper trail of performance expectations, coaching, and the data that defined the referral footprint; those exhibits often decide whether a covenant looks tailored and reasonable or punitive.
A contract can be written in such a manner that a physician is fired due to his failure to achieve revenue or patient targets yet is still subject to a non-compete. This is subject to the state law and the legality of the contract. Most non-compete including those in California are void, yet in other states such as Texas and Florida, the courts tend to enforce the non-compete provided it is geographically, duration, and scope restricted. The American Medical Association indicates that approximately 37 percent of doctors are contracted to non-compete. The important point is that the agreement must safeguard lawful business interests and be drafted such that the courts find them meaningful, irrespective of the competence or the reputation of the physician.
This case is fascinating because it really highlights the tension between protecting a practice's business interests and ensuring fairness to physicians. From my perspective, what stood out is how easily non-competes can backfire if they're not drafted with real-world enforceability in mind. You can't just rely on the idea that signing a contract automatically makes everything reasonable. Courts are looking at the actual impact on the physician's ability to earn a living. So even if a doctor isn't bringing in enough revenue, you can't just fire them and expect a rigid non-compete to stick, especially in a niche specialty where job options are limited. The language in contracts has to be very carefully calibrated to the scope, geography, and duration, and practices need to be able to demonstrate a legitimate business interest beyond simple financial performance. One thing practices sometimes overlook is incorporating tailored performance benchmarks or clear definitions of what constitutes a "for cause" termination. That can give the contract more teeth without being overly punitive. At the end of the day, it's about balance. Protecting patient lists, confidential information, and practice goodwill is valid, but courts will push back if the covenant effectively strangles a physician's career. Vogel's case reminds us that enforceability isn't theoretical; it's practical.
In the marketing side of healthcare, I often hear from physicians that non-competes not only limit where they work but also how they can establish visibility through patient outreach. For example, I've worked with surgeons who had to pause campaigns because their contracts restricted even digital engagement in nearby regions. That creates both lost revenue and patient confusion. In my view, practices benefit from customizing covenants for niche specialties rather than applying a one-size-fits-all rule. It's easier to uphold when the terms feel practical for both the employer and the physician.
From my experience managing healthcare programs, I've learned that restrictive covenants can get tricky when contracts don't clearly define 'cause.' We once had to renegotiate agreements with staff so expectations around performance, cultural fit, and financial contribution were spelled out upfront. That way, enforcement later wasn't left open to interpretation. I'd suggest practices work with both legal counsel and financial advisors on contract language, especially for physicians in specialized fields. Otherwise, there's risk that a court sees restrictions as unreasonable and sides with the physician.
As a practicing surgeon, I've seen colleagues tangled in contracts where non-competes became more restrictive than they realized. In one case, a friend spent months unable to take referrals because the contract didn't distinguish between being let go for productivity versus misconduct. Courts tend to look at fairness, so even if signed, it has to make sense in practice. That's why I've always been careful to review the true geographic and specialty restrictions before agreeing. Doctors should push for clarityvague or overly broad covenants usually don't stand up well under scrutiny.