Some contracts require doctors who quit to stop practicing nearby. SC bill would ban that.

COLUMBIA — A bill advancing in the House would ban hospitals and doctors’ offices from requiring physicians to sign noncompete clauses that prevent them from practicing medicine in the area for a certain length of time if want to change jobs.

The bill, which the five-member subcommittee supported unanimously, could help offset a statewide physician shortage, keeping doctors from leaving their practice areas and potentially attracting more to the state, said several doctors and representatives of advocacy groups. The vote Tuesday sent the proposal to the full House Medical, Military, Public, and Municipal Affairs Committee, commonly called 3M.

Doctors who sign a noncompete agreement but leave their jobs for any reason often have to go far from their existing patients, cutting off care, doctors said. The issue becomes particularly acute in areas with few doctors, where every health professional is vital to maintaining the community’s health, they said.

Under the bill, doctors could continue to practice in the area immediately and tell their patients where they were going so patients could choose to continue care with them.

“We need to agree that anything that will lead to physicians leaving, particularly rural and underserved communities, when they don’t want to is something that’s not good for South Carolina, for access to care, for our patients, for health outcomes,” said Jonathan Gleason, executive vice president at Prisma Hospital.

Prisma does not require doctors to sign noncompete clauses, Gleason added.

Jessica Mendelsohn, a Fort Mill doctor, ran into issues with noncompete clauses when hiring for her private practice, New South Family Medicine, she said. Her husband, David Mendelsohn, and another doctor wanted to join her, but they had signed contracts barring them from working in the area if they left their jobs.

The Mendelsohns spent thousands of dollars trying to get David Mendelsohn out of his contract. Eventually, the Mendelsohns rented a separate office away from the practice’s main building to get David Mendelsohn and the practice’s other doctor out of the zone where they couldn’t practice, Jessica Mendelsohn said.

Patients who wanted to keep their longtime doctors had to drive longer distances, even though their physicians still lived in the community, she said. The contracts also discourage doctors from jumping on other opportunities, Mendelsohn said.

“Noncompete clauses are worsening an already-fragile workplace by restricting physician mobility and discouraging independent practice,” Mendelsohn said.

Patients who can’t or don’t want to travel further need to decide whether to find a new doctor, which can be a long process, or stop getting regular health care altogether, Mendelsohn said.

Sometimes, patients in rural areas or those with few doctors don’t have a choice of a new physician when one leaves, said Cleave Ham, a retired radiologist and board member for the South Carolina Medical Association. If a specialist is forced out of the area, that often means the community loses that person’s skills altogether, he said.

Increasing flexibility for doctors to leave jobs could attract more doctors to the state, Ham said.

“I think that physicians are looking for this,” Ham said.

The state has a similar ban on noncompete clauses for attorneys, recognizing the significance of the relationship between an attorney and their clients. The same should be true for doctors and their patients, Ham said.

A hospital system or doctors’ office could still penalize physicians who quickly quit their jobs. Contracts could require anyone who left after less than three years of work to repay relocation fees, signing bonuses and retention bonuses.

Doctors generally don’t start turning a profit for their employers until after that three-year mark, said Austin Smallwood, a lobbyist for the South Carolina Hospital Association.

Smallwood suggested also allowing hospitals to ask for repayment of a year’s salary for doctors who leave before that three-year mark, though legislators did not add that to the bill Tuesday.