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September 06, 2011 08:49 AM

Case Tests Limits On Where SD Doctors Can Work

sioux falls, sd

Sanford Health is working to appeal a judge's ruling that would restrict its ability to include "noncompete" clauses in physician contracts.

Many health systems use the agreements to prevent physicians from setting up their own operations and taking patients with them after they quit or get fired. Judge Doug Hoffman ruled in late July that noncompete agreements in Sanford's standard physician contracts violate South Dakota law because they have the potential to interfere with doctor-patient relationships.

The ruling was part of a wrongful termination lawsuit. Sanford wants to separate the noncompete clause portion of the ruling so the health system can appeal it to the state Supreme Court. The high court would then decide whether South Dakota clinics can restrict where departing doctors work.

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