Policy Alert: 
FTC Votes to Release Final Rule Banning Most Non-Compete Agreements 

On April 23, 2024, the Federal Trade Commission (FTC) voted on a final rule regarding non-compete agreements. The rule, passed by a 3-2 majority, will ban new non-compete agreements for all workers and require companies to inform current and past employees that they won’t enforce them. Additionally, existing non-compete agreements for most workers will be invalidated, except for senior executives.

Since the FTC first proposed this rule in January 2023, LUGPA has vehemently opposed these efforts for several compelling reasons. If enacted, we firmly believe these rules could disproportionately favor large hospital systems, potentially disrupting the competitive landscape and impeding patient access to diverse healthcare options.

LUGPA has previously taken proactive steps to advocate for the interests of independent medical providers and their patients. In response to the original rule, we submitted detailed comments to the FTC, articulating our opposition to the proposed rules and highlighting the potential negative impact on healthcare delivery and patient access.

It's worth noting that lawsuits against the final rule will likely be introduced soon. The U.S. Chamber of Commerce, the largest pro-business lobbying group in the country, has already announced its intention to sue to block the rule.

The final rule will not become effective for at least 120 days, but the Chamber will likely seek a temporary injunction to prevent the rule from going into effect for the months or even years it will likely take to litigate the rule. In addition, the Chamber’s lawsuit is likely to be impacted by a pair of cases currently in front of the Supreme Court that implicate the Chevron deference. For now, it is unclear when the rule will actually go into effect.

As we continue to monitor regulatory developments and advocate for policies that promote fairness and competition in healthcare, we urge all stakeholders to remain engaged and informed.

LUGPA will respond to the new final rule and continue to work towards solutions that preserve the integrity of the healthcare marketplace and ensure that patients receive high-quality, accessible care from a diverse array of providers.

For additional information, you can read the FTC’s Fact Sheet on the Proposed Final Noncompete Rule here.