YIKES

[Guest guest]

in rural MAine 1 hr from me, docs must repay $100,000 ?? for violating restrictive covenant??  This is a catholic  health  care system St 's. Nasty stuff  Course their new employer says  it will pay this for them. I wonder how long they must run on a new treadmill to pay for that?

Oh be glad  you are an IMP Jean.

Jean

 

 

 

 

Restrictive Covenant Upheld in Androscoggin County Superior Court Case

A restrictive covenant in physician employment agreements was upheld in a Maine Superior Court case this past week involving three physicians who left their employment at St. 's Regional Medical Center to accept positions at Central Maine Medical Center.  The physicians were ordered to pay the Sisters of Charity Health Systems Inc. (owner of St. 's Regional Medical Center) $100,000 each.  Each of the primary care physicians had signed contracts in 2004 prohibiting them from practicing medicine within a 25-mile radius of the 99 Campus Avenue facility of St. 's for a two-year period after leaving employment.  A liquidated damages clause in the contracts provided the option of paying $100,000 to the medical center rather than waiting the prescribed two-year period.  Each of the physicians began practicing with CMMC during the two-year period and did not pay any of the liquidated damages amount.

According to the court's decision, the physicians appeared to have taken with them 1,374 of the 4800 patients at their former office. 

The physicians defended the case on the grounds that the restrictive covenant clauses were against public policy.  Their position undoubtedly was based upon AMA Code of Medical Ethics Opinion 9.02, Restrictive Covenants and the Practice of Medicine.  This opinion frowns upon restrictive covenants because they limit the supply of medical services available to patients.  You can find Opinion 9.02 on the web at:  https://ssl3.ama-assn.org/apps/ecomm/PolicyFinderForm.pl?site=www.ama-assn.org & uri=/ama1/pub/upload/mm/PolicyFinder/policyfiles/HnE/E-9.02.HTM.  However, Superior Court Justice Delahanty II noted that medicine and health care today were big businesses and that governing corporate entities could act to protect their continued viability to provide for the overall well-being of its patient base and the community.  He concluded that the restrictions were " reasonable. "

During the trial, it was revealed that prior to employment, CMMC has agreed to pay any damages the physicians might incur resulting from the lawsuit.

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