Ajello introduces bill to curb restrictive covenants, enhance physician recruiting and retention
STATE HOUSE – Rep. Edith H. Ajello (D-Dist. 1, Providence) has introduced legislation (2016-H 7586) to enhance physician recruiting and retention in Rhode Island by limiting restrictive covenants in physician employment contracts. These restrictive covenants are intended to prevent a physician leaving an employer from continuing to treat his or her patients or establishing a new practice within a defined geographic area.
“I hear often from my physician constituents that recruiting new physicians to Rhode Island is very challenging and competitive, contributing to an under-supply of physicians in some specialties. While the No. 1 competitive issue — lower salaries than other New England states — is not a legislative matter, making it possible to change practice locations within our state once a physician has come here will help make us more competitive and provide continuity of care for those patients whose doctor has changed practices,” said Ajello.
Restrictive covenants or non-compete clauses are often included in physician employment contracts in Rhode Island. These covenants are triggered when a physician leaves the employment of a practice or hospital. Typically these restrictive covenants place a geographic limit on where the physician may set up a new practice and whether that physician may continue to care for his or her patients.
Massachusetts has prohibited these restrictive covenants, while many Rhode Island physician employment contracts still contain them. A doctor reading a proposed employment agreement in Rhode Island and seeing no such restriction in a contract from a Massachusetts health care organization might well choose to relocate to Massachusetts instead of Rhode Island, with better pay and freedom of movement within the state. These covenants send a chilling message to individuals we want to recruit to Rhode Island.
“Imagine a pregnant woman whose first, difficult delivery was positively impacted by a physician on the Women & Infants staff. I think that pregnant woman would want that doctor to be able to let her know that he is still practicing medicine in Rhode Island, though no longer on staff at Women & Infants,” Ajello said. “That doctor could be her first choice, and she should be able to continue their doctor-patient relationship.”
Sen. Gayle Goldin (D-Dist. 3, Providence) is sponsoring identical legislation (2016-S 2578) in the Senate.
“Health care is so much more than a business. There is an immeasurable value in allowing successful doctor-patient relationships to be maintained when a doctor moves from one practice to another. An elderly person, for example, who has seen the same cardiologist for years, benefits from that doctor’s knowledge of her medical and personal history, and from the comfort and familiarity she has with that doctor. Eliminating restrictive covenants makes the continuation of those relationships possible, and that’s healthier for patients,” said Senator Goldin.
Representative Ajello pointed to the legislation’s potential benefits to Rhode Island’s economy.
“As we seek to build our economy and expand ‘meds and eds,’ wouldn’t we rather a physician recruited to pursue her cutting edge immunology work at Rhode Island Hospital be able to stay in Rhode Island, continuing to treat some patients while moving to a more research-oriented position with Epivax?
“This legislation significantly limits the use of these covenants. It prohibits any geographic limitations or any limits on a physician continuing to care for his or her patients. During testimony last year, the hospitals opposed my bill outright. This year’s version would continue to prohibit the physician from actively soliciting the patients of his or her previous employer. I hope this compromise will alleviate the hospitals’ concerns,” Ajello concluded.
The Rhode Island Medical Society supports the legislation, which is scheduled for hearings before the House Corporations Committee and the Senate Health and Human Services Committee tomorrow.
Cosponsors of the House bill include Rep. Arthur J. Corvese (D-Dist. 55, North Providence), Rep. Katherine S. Kazarian (D-Dist. 63 East Providence), Rep. Eileen S. Naughton (D-Dist. 21, Warwick) and Rep. Mary Duffy Messier (D-Dist. 62, Pawtucket). Sen. Adam J. Satchell (D-Dist. 9, West Warwick) and Sen. Joshua Miller (D-Dist. 28, Cranston, Providence) are the Senate cosponsors.
For more information, contact:
Meredyth R. Whitty, Publicist
State House Room 20
Providence, RI 02903