As some in the medical field know too well, it can be hard to leave a healthcare job.
Sure, patient relationships and coworker bonds are difficult to sever, but one of the top things keeping many from branching off on their own just might be their contracts.
Between 37% to 45% of US physicians are in employer agreements that limit where they can work after they leave or how long they must stay in their current position, according to professional group the American Medical Association (AMA), compared to about 18% of the overall workforce nationwide, per a 2021 article in the Journal of Law and Economics.
On Sept. 10, the Federal Trade Commission (FTC) announced it had sent warning letters to several healthcare and staffing companies with potentially “unreasonable noncompete agreements in employment contracts.” A few days earlier, it had asked for public comment to inform “case-by-case” enforcement of noncompetes going forward.
This comes shortly after the commission announced Sept. 5 it’s officially abandoning attempts to defend a ban on all noncompetes that it passed in April 2024.
It’s all left providers and hospitals alike asking: What’s next for noncompetes?
“Even though [the FTC ban] legally did not go through, that has caused a lot of professional societies, state governments, and regulators to take a look at the issue,” Joseph Marine, a professor of medicine at Johns Hopkins University School of Medicine, told us.
The future. Chances for a nationwide ban on noncompetes are “slim,” but restrictions are growing state by state, Daniel Gilman, a senior scholar of competition policy at nonprofit research organization International Center for Law & Economics, told us.
There have been more than 60 state bills introduced in 2025 to establish or expand restrictions on noncompete agreements, according to bipartisan public policy organization the Economic Innovation Group. As of June, the group counted four states (California, Oklahoma, Minnesota, and North Dakota) that have totally banned noncompetes and 34 plus Washington, DC, that have restricted their use.
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Hospitals vs. providers. Whether restricting noncompetes is a good thing depends on the market and who you ask.
Marine believes that while these agreements can be a tool for smaller practices to ensure they recoup their investment in new hires, it’s possible they could also be “abused” by big health systems and groups to dominate a local market, as has been previously alleged in lawsuits.
“Noncompetes are being written in a way by these large health systems that physicians who wish to leave and do something differently are virtually always forced to move, sometimes out of the state, in order to practice,” he said.
In 2023, hospital lobbyist group the American Hospital Association opposed the FTC’s ban on noncompetes, arguing in a letter to the commission it could disrupt the healthcare labor market and exacerbate healthcare worker shortages.
AMA, which lobbies for physicians, largely opposes noncompetes in its code of ethics. It argues they “restrict competition, can disrupt continuity of care, and may limit access to care,” though it doesn’t support a complete ban, either, the organization said last year.
Gilman said whether noncompete agreements illegally restrict competition likely depends on the market and factors like how many competitors there are.
He said there’s not enough research to conclude how noncompetes impact physicians or healthcare costs.
“We have very few studies of the effects of noncompetes in the healthcare sector specifically, or even more specifically, with regard to particular healthcare occupations,” he said.
One 2020 study in the Journal of Human Resources found noncompetes to be linked to lower physician job turnover. The study also noted, however, that this is a “relatively understudied topic” and more research is needed.