Where We Stand
Section: Professional Standards
Policy: Contractual Arrangements – Restrictive Covenants

Contractual Arrangements – Restrictive Covenants

Contractual arrangements among physicians practicing together which, in the event of their separation, absolutely proscribe any of them from practicing within a certain geographic area for a certain period of time are not in the best interests of affected patients or the general public and are to be discouraged.

Contractual arrangements between a physician joining an established practice may, in the event of the former party's separation from the practice and establishment of a competitive practice, permit the latter party to collect from the former reimbursement for actual expenses incurred to recruit and subsidize that physician, provided allowance is made for amortization of such expenses during the physician's association with the practice.

In all contractual matters, physicians should seek appropriate legal and other advice to assure they clearly understand and agree to the terms of documents they sign

Adopted at the annual House of Delegates, 1992.
Reaffirmed at the annual House of Delegates, 2011.

Return to the Where We Stand table of contents.