The Federal Trade Commission has approved a noncompete ban that aims to eliminate noncompete agreements across all sectors of the economy, including the health care industry. The rule, which was passed by a three to two vote, could have a significant impact on the industry and its workers.
Under the new rule, almost one in five Americans who are currently subject to noncompete agreements could see them disappear if the final rule is implemented in late August. This change is expected to lead to more new businesses and higher earnings for workers, as they will be free to move between companies without fear of legal repercussions.
However, it is likely that the noncompete ban will face legal challenges and may not take effect for years if ever. The contentious nature of the rule means that it will likely be tied up in litigation before it can be fully enforced. As such, it may not have as broad of an impact on the health care industry as originally thought.
One important aspect of the noncompete ban is that it does not apply to nonprofit companies such as hospitals or some of the largest health insurers in the country. This means that while it may not have as significant an impact on these organizations as other sectors of the economy, it could still lead to some changes within their operations and decision-making processes.