Fierce Healthcare – By Frank Diamond | Jan 6, 2023
Noncompete agreements have become so ubiquitous that a proposed rule published by the Federal Trade Commission (FTC) yesterday will affect almost all industries, experts say.
Healthcare will be no exception, Carrie Amezcua, an attorney with the law firm Buchanan Ingersoll & Rooney, told Fierce Healthcare. She said healthcare industry executives should keep a close eye on the debate about the rule.
The public has 60 days to submit comments before the FTC can make it final.
“It could still change—it could still be challenged actually—because it goes too far from what the FTC has the authority to do,” said Amezcua, who usually represents employers in disputes over noncompete agreements.
Backlash to the rule has already begun. In a statement, the U.S. Chamber of Commerce called the regulation "blatantly unlawful."
The rule falls under Section 5 of the FTC Act, which bans unfair methods of competition. So, not-for-profit healthcare systems would not be covered by the rule, said Amezcua.
“For physicians, if they are working directly for a hospital, and that hospital is a nonprofit, that hospital is not actually covered by the FTC act. So that hospital is not subject to this rule,” said Amezcua.
About 45% of primary care physicians employed by group practices are bound by noncompete agreements, according to one survey (PDF) by researchers from various universities.
Amezcua added: “Insurers are not exempt from the FTC Act. They would be subject to this rule in its final form. And right now, it is written as a complete ban on noncompete agreements, post-employment. You could still have a noncompete during your employment. But you can’t have the provision that says you can't work for another company for two years after you leave.”
Once used to keep high-level executives and salespeople from running off to competitors with sensitive and proprietary company information and clients, the agreements have evolved to a point where many workers making minimum wage at fast food establishments aren’t able to change jobs because they’d signed a noncompete agreement.
The FTC said employees often agree under duress: Either sign or lose your job.
Elizabeth Wilkins, the FTC’s director of the office of policy planning, said in a statement that “the proposed rule would ensure that employers can’t exploit their outsized bargaining power to limit workers’ opportunities and stifle competition.”
If enacted, the rule would boost wages by about $296 billion a year, according to the FTC.
Echoing Amezcua’s remarks about FTC overreach, Sean Heather, the Chamber's vice president for international regulatory affairs and antitrust, said in the statement that “Congress has never delegated the FTC anything close to the authority it would need to promulgate such a competition rule.”
Kristen Limarzi, a partner at Gibson, Dunn & Crutcher, was once a senior official in the antitrust division of the Department of Justice. Limarzi told Fierce Healthcare that she’s not convinced by the economic research the FTC used to justify the rule.
Limarzi said that “FTC Commissioner Christine Wilson argued in her dissent that the empirical evidence is more mixed and that studies show noncompete provisions can incentivize employer investment in things like worker training that ultimately benefits both employers and workers. The impact of a noncompete in any particular industry is likely quite fact specific. But the FTC rule would impose a nationwide ban.”
But Heather also said that “attempting to ban noncompete clauses in all employment circumstances overturns well-established state laws which have long governed their use and ignores the fact that, when appropriately used, noncompete agreements are an important tool in fostering innovation and preserving competition.”
However, evidence seems to be mounting that states will not side with the U.S. Chamber of Commerce when it comes to noncompete agreements, and in fact, might impose even more restrictions than the FTC rule would.
The proposed rule “is a floor and not a ceiling,” said Amezcua. “So, some states have even more restrictions right now, like California, on noncompete agreements. That would stay and be enforceable regardless of what the final rule says.”
North Dakota and Oklahoma also, in effect, ban noncompete agreements. Some states—such as Illinois, Colorado and New Jersey—have not out-and-out banned noncompete agreements yet have nonetheless made them much harder for employers to defend.
New Jersey legislators introduced a bill that caps noncompete agreements at a year post-termination and would make employers pay the former employee their full salary, including benefits, for that year unless the employee had been fired for misconduct.
In other words, everybody—not just the top executives making millions of dollars—would get a golden parachute, or at least be afforded a soft landing.
In a tweet, President Joe Biden praised the rule.
"For decades, I’ve fought for the notion that if your employer wants to keep you, they need to make it worth your while with good pay and benefits," Biden said in the post. "Consistent with my Executive Order, today's FTC announcement to limit non-compete agreements is a huge win for workers."
Fierce Healthcare reached out to America’s Health Insurance Plans, the Alliance of Community Health Plans, the American Medical Association and the Association for Community Affiliated Plans for comment on the potential rule's impacts on the industry and had not received a response at the time of publication.
Both the State Senate and the State Assembly were on the floor this month, but only dealt with limited calendars. Both houses adopted an amendment to the constitution relating to bail imposed on defendants awaiting trial, as well as a resolution to create an advisory referendum to be held at the April non-partisan election on the issue of whether individuals receiving public assistance should be subject to a work requirement. The proposed constitutional amendment will also go before voters (to approve or deny) in April.
The first campaign finance reports for WI Supreme Court candidates were due earlier this month, and Milwaukee County Circuit Court Judge Janet Protasiewicz reported raising $756,000 in the last 6 months of last year, more than doubling her next closest competitors. Waukesha County Circuit Court Judge Jennifer Dorow raised $306,000, former Supreme Court Justice Dan Kelly raised $312,000 and Dane County Circuit Court Judge Everett Mitchell raised $115,000. The four face off in a primary in February, with the top two vote getters moving on to the April General Election. While the Supreme Court is nonpartisan, its members do loosely line up along ideological lines, with Conservatives holding a 4-3 advantage. For Conservatives to maintain their majority, either Dorow or Kelly would need to win the April Election.
Legislative Republicans have proposed two bills early this session focusing on tax cuts, fulfilling campaign promises from last fall. Earlier this month, Senate Majority Leader Devin LeMahieu circulated a bill that would phase in a flat tax over the next four years. The State currently has four income tax brackets, and if this bill were to pass, everyone in Wisconsin would be paying a rate of 3.25%, down from 7.65%, which is what taxpayers in the upper bracket are currently paying. Governor Evers has said he does not support this proposal, although he is likely to introduce his own income tax relief proposal in his budget bill.
Republicans have also re-introduced legislation to eliminate the personal property tax in Wisconsin. While Evers vetoed a bill to repeal the personal property tax last session, Republicans hope a compromise on the issue can be reached this session.
The Wisconsin Department of Health Services (DHS) recently announced the state’s Medicaid program is now projected to finish the fiscal year with a $774.8 million surplus, roughly $270 million more than what was expected late last year. Former DHS Secretary Karen Timberlake, who stepped down from her post earlier this month, attributed the surplus to several factors, including the federal government’s continuation of enhanced reimbursement rates and reduced costs for prescription drugs. Given the nearly $300 million upper to the Medicaid fund, the state is expected to finish the current fiscal year with an overall budget surplus of close to $6.9 billion.
Earlier this month, the Medicare Payment Advisory Commission (MedPAC) voted to urge Congress to increase 2024 Medicare payments for physicians.
More specifically, MedPAC recommended increasing physician reimbursement under the 2024 Physician Fee Schedule (PFS) at 50% of the Medicare economic index (MEI), which would result in a 1.25% boost to payments for 2024.
The panel also recommended add-on payments under the PFS (15% for primary care and 5% for specialty care) for services provided to the low-income Medicare population.
From the Desk of the AAO: Year-End Spending Bill Addresses Other Academy Priorities
American Academy of Ophthalmology – January 5, 2023
In its last act as the 117th Congress, lawmakers passed an omnibus spending bill that did more than address scheduled physician payment cuts. Along with funding the government programs over the next year the bill also enacts new policies related to health care — including funding for vision research and extending telehealth provisions.
The Academy has analyzed over 4,000 pages of legislative text. Here are other provisions that could affect ophthalmology over the next year.
National Eye Institute and Vision Research Funding
The spending bill included important increases for the National Institutes of Health (NIH) and the National Eye Institute (NEI) that we advocated for in 2022.
The bill provides $47.5 billion for NIH, a $2.5 billion increase over the fiscal year 2022 level, and includes $896.5 million for NEI, an increase of $32.6 million.
Congress also provided $20 million in funding for the Vision Research Program, which is the only dedicated funding source for extramural research into military deployment-related vision trauma.
In keeping with the Academy’s commitment to ensure the highest quality eyecare for military service members and veterans, we have joined the broader vision community to continue to advocate for Vision Research Program funding, and the omnibus legislation maintains the fifth consecutive year of level funding for this important program.
Congress established the program in 2009 to fund effective military-relevant vision research with the potential to significantly improve the health care and well-being of service members, veterans and the public.
Telehealth Provisions
It also keeps in place public health emergency waivers, including:
The Department of Health and Human Services will be required to submit a report to Congress on utilization of services. The interim report is due in October 2024 and the final report in April 2026.
Food and Drug Administration
Although Congress members included a number of Food and Drug Administration (FDA)-related policies in the bill, we were disappointed that they did not include language to restore the longstanding approval process for ophthalmic drugs that we had advocated for.
The Academy had sought legislative language to address a significant change in the FDA’s regulatory framework that no longer allows the agency to regulate products that incorporate a device solely as a drug product. The language would have clarified that any drug packaged in an eye cup, eye dropper or other noninvasive or nonimplanted dispenser is to be regulated as a drug and not a combination product.
Such language was included in S 4348, the Food and Drug Administration Safety and Landmark Advancements Act, which advanced out of the Senate Health, Education, Labor, and Pensions Committee last year.
Hello WAO members. I wish you were hearing from me with better news, but unfortunately, I have some concerning information to share with you. The WAO is aware that seminars are being offered in Wisconsin to train optometrists on advanced laser surgery procedures, which are clearly outside their scope of practice. We also have reason to believe that a handful optometrists are already performing YAG capsulotomies in Wisconsin.
Make no mistake, the threat to patients and the practice of Ophthalmology in Wisconsin is very real!
While a growing number of states have expanded their optometric scope of practice laws to specifically allow optometrists to perform certain office-based laser procedures – with Virginia and Colorado being the latest—current Wisconsin law prohibits these lasers surgeries from being performed by ODs.
Unfortunately, that has not prevented brazen efforts to train Wisconsin optometrists on these procedures, with the goal of fully opening the door for ODs to provide laser surgeries across the state.
The good news is the WAO is fully committed to protecting patient safety and will take appropriate legal action to prevent unlawful surgical procedures that put patients at risk.
The other concern is that Wisconsin optometrists will unite to pursue an advocacy campaign to allow ODs to perform laser surgeries. WAO is confident it is a matter of when and not if we will face an optometrist scope of practice battle in Wisconsin.
Thankfully, we have an opportunity to push back – and to secure patient safety and preserve the Ophthalmology scope of practice. But we can only do it with your help, as WAO member engagement will be critical to our success. With that in mind, I am asking you to act TODAY to help us meet the growing challenges we face. Here is how you can help:
While engaging in WAO grassroots advocacy is easy and doesn’t require much time, I do understand firsthand the challenges of fitting “another task” into your busy schedule. However, I am making this personal request because it is critically important. As John F. Kennedy once said, “There are risks and costs to action. But they are far less than the long-range risks of comfortable inaction.”
In closing, I would again urge you to get involved and stay involved to help enhance the practice of Ophthalmology and protect patient safety in Wisconsin.
Please contact the WAO at wao@badgerbay.org with any questions or for more information on this important issue.
The WAO would like to thank Dr. Holtebeck and his team at Envision Surgery Center for hosting and participating in the meeting. He did a tremendous job explaining the most pressing issues facing ophthalmologists and the patients you serve, including the current efforts of optometrists across the county – and right here in Wisconsin – to provide advanced laser surgery procedures, which are clearly outside their scope of practice. Rep. Duchow certainly understood our concerns and how it could negatively impact patient safety.
Rep. Duchow, who was first elected to the Assembly in a Sept. 2015 special election, represents Wisconsin’s 99th Assembly District, which covers potions of Waukesha County, including the City of Delafield and the Village of Hartland.
If you are interested in setting-up a similar meeting with your local state lawmakers, the WAO Government Affairs Team is eager to coordinate all the details. These meetings, which can be located at your facility, or a local coffee shop provide a tremendous opportunity for WAO members to build or strengthen their relationships with their legislators and brief them on policy issues important to the practice of ophthalmology and patient care.
Again, WAO encourages all members to participate in our Capitol Connection program to help counter the efforts of optometrists to provide surgical procedures in Wisconsin. If you are interested in participating, please contact the WAO office at wao@badgerbay.co.
Republican legislative leaders in both the Wisconsin Assembly and Senate recently announced standing committee assignments for the 2023-24 legislative session. Please find below the GOP make-up of the health committees in both houses:
Full Assembly Republican committee rosters: https://www.wispolitics.com/wp-content/uploads/2022/12/221215Committee.pdf
Full Senate Republican committee rosters: https://www.wispolitics.com/wp-content/uploads/2022/12/221215Senate.pdf
It is also important to point out that appointments to the 16-member Joint Finance Committee (JFC) were also announced. The Republican-controlled committee, which is comprised of equal members from both the Assembly and Senate, is among the most important committees in the Legislature, as it is charged with writing the two-year state budget bill. Please find below the JFC roster for the 2023-24 legislative session:
Assembly Members
· Republicans:
· Democrats
Senate Members
· Republicans
As was announced in last month’s WAO Advocacy Newsletter, State Sen. Alberta Darling (R-River Hills) stepped down from office on Dec. 1 after serving in the Legislature for 32 years.
The 8th Senate District, which Darling vacated, covers portions of Waukesha, Ozaukee, and Washington Counties, including the municipalities of Mequon, Cedarburg, Germantown, and Menomonee Falls. The district leans Republican, but the special election could be competitive, and several candidates – from both sides of the aisle – have announced they will seek the open seat next year.
The GOP primary will be crowded, as Republican State Representatives Dan Knodl (R-Germantown) and Janel Brandtjen (R-Menomonee Falls), whose Assembly districts lie within the 8th Senate District, have announced their candidacy. Other Republicans planning to run include Village of Thiensville President Van Mobley; Brown Deer college student Robert Albrightson; and former State Senator Randy Hopper.
On the Democratic side, Whitefish Bay attorney Jodi Habush Sinykin is the only announced candidate.
Gov. Tony Evers has ordered a special election for April 2023, which coincides with the state’s 2023 spring election. If necessary – which currently appears to be the case on the GOP side – a primary will be held on February 21. The winner of the special election will serve the remainder of Darling’s term, which ends in January 2025.
· Earlier this month, Gov. Tony Evers announced Wisconsin Department of Health Services (DHS) Secretary-designee Karen Timberlake will leave her post on Jan. 2, 2023. State Medicaid Director Lisa Olson will also be leaving the Department in the near future. Evers has not yet appointed their replacements.
· Gov. Evers recently announced he will give his 2023 State of the State Address on Tuesday, January 24. His 2023-25 Biennial Budget Address will take place on Wednesday, February 15. He will give both addresses at 7:00 P.M. before a joint session of the Legislature.
Consistent and focused advocacy is critical to the long-term viability of ophthalmology and the delivery of quality medical eye care in Wisconsin. And the WAO is an active force in Madison working on issues of importance to WAO members that impact the practice ophthalmology. Our comprehensive advocacy program aims to:
1. Strengthen the image of the practice of ophthalmology and educate policymakers on the importance of medical eye care; and
2. Provide public policy leadership to enhance the practice of ophthalmology and ensure high standards for medical eye care are maintained in Wisconsin.
Of course, our most effective advocacy efforts actively engage WAO members in their strategy and execution – aiming to capitalize on the expertise of our physician members.
Member participation in WAO’s advocacy programs is increasingly important, as we are likely to face two highly concerning legislative battles in the 2023-24 legislative session. Nursing special interests will almost certainly reintroduce their “APRN bill” – a proposal to create a new advanced practice nurse practitioner (APRN) license and authorize APRNs to prescribe medication and generally practice an expanded scope of care without direct physician supervision. A similar proposal introduced last session ignored the need for critical title protection for physicians.
In addition, we anticipate Wisconsin optometrists will pursue legislation to expand their permissible scope of services, as they have in several other states. In fact, there are now ten states – with Virginia and Colorado being the latest—that have expanded their optometric scope of practice laws to specifically include certain office-based laser procedures for glaucoma and post-cataract care. Again, it would not be surprising if an optometrist scope of practice battle hits the Badger State as early as the 2023-24 legislative session.
Thankfully, WAO is well-positioned act on these issues. In addition to our direct lobbying efforts thorough our professional lobbying form (HZW), we have several advocacy programs in place – that draw on the collective grassroots voice of WAO members – to influence public policy at every level of government. If are not already involved, WAO encourages you to participate in the following three programs to strengthen our influence in the Wisconsin Legislature and ultimately help us meet our legislative/regulatory goals:
· Sign-up for WAO’s Legislative Key Contact Program
WAO’s Legislative Key Contact Program can be a highly effective grassroots advocacy tool to help build and nurture strong on-going relationships between WAO members and lawmakers in Wisconsin. Ultimately, the program can help us help shape new policies important to our members.
The program is live on the WAO website and members can easily and quickly sign-up as a Key Contact. With the campaign season winding down, and the 2023-24 legislative session right around the corner, it’s more important than ever for WAO to have a robust Key Contact Program. It is essential to raising our profile in the State Capitol and beyond.
As a Key Contact, you can help influence the legislative process by cultivating relationships with elected officials. By taking advantage of existing relationships and making new contact with members of the Wisconsin Legislature (as well as the Wisconsin Congressional Delegation), you can help us educate lawmakers on the practice of ophthalmology and ultimately influence legislation.
But the program will not succeed without strong member participation, so please take a few moments to read more about it – and learn how simple it is to “enlist” and participate as a Key Contact. The time commitment is minimal and your responsibility as a key contact depends on your level of comfort and willingness to engage.
Remember, lawmakers are often eager to hear input from their constituents, and as an expert in the home health care field, you can make a real difference in the policy process as a Key Contact. CLICK HERE to sign-up by filling out and submitting a brief online survey.
· Participate in the WAO Capitol Connection Program
In WAO’s ongoing effort to raise the profile of ophthalmology and our organization in the State Capitol, we have established our Capitol Connection program to encourage WAO members to invite their local legislators to visit their clinics and facilities.
The program is designed to help WAO members build and strengthen working relationships with legislators and offers a unique face-to-face opportunity to educate them about the importance of ophthalmology and medical eye care. Through the Capitol Connection program, lawmakers can learn firsthand what is important to the ophthalmology community. In many cases, just a single meeting or contact can have a significant impact on a legislator's view or position on a legislative issue.
With potential scope of practice legislative battles on the horizon, it’s more important than ever for WAO members to connect with their state lawmakers to discuss the critical role of ophthalmology, as well as the level of education, training, and knowledge required of ophthalmologists.
To date, we have held multiple successful legislative tours and have several more being planned for the near future. Hosting a legislator at your site is easy, enjoyable, and can make a significant advocacy impact, so we would encourage all WAO members to participate in this highly effective advocacy program.
If you would like to host a legislative tour at your site, please contact the WAO office at wao@badgerbay.co. We will work with you and your legislators to coordinate the meetings and will provide participating members with full support, including legislator bios, advocacy tips, issue briefings, and supporting documents.
· Contribute to the WAO Political Action Committee
The Wisconsin Academy of Ophthalmology is committed to offering a wide collection of member services and programing. That includes a comprehensive government affairs program that provides direct lobbying services and grassroots advocacy strategies to increase WAO’s presence in the State Capitol and help shape policy decisions that preserve and enhance the practice of ophthalmology in Wisconsin.
One of the most effective advocacy tools the WAO has as its disposal is the Ophthalmologists for Better Government Political Action Committee (PAC). The PAC allows WAO to collect contributions from members into a single account to support candidates for state legislative office who understand and support issues important to ophthalmologists, the practice of ophthalmology, and Wisconsin’s House of Medicine.
Contributing to our PAC is more important than ever, as optometrists have been successful in expanding their permissible scope of services in several other states – and the debate is heating up in other parts of the country. Wisconsin could very likely be next… and an optometrist scope of practice battle may hit the Badger State as early as the 2023-24 legislative session.
The best way we can win these legislative battles is to significantly enhance our legislative advocacy outreach, and having a robust, well-funded PAC is critical to our efforts. With strong member participation in the Ophthalmologists for Better Government PAC, we will be well positioned to preserve the Ophthalmology scope of practice in Wisconsin.
As mentioned above, the WAO PAC is funded through contributions from ophthalmologists across the state and is only effective as a political tool if members participate in the program. With that in mind, please take a few moments and contribute online TODAY to the Ophthalmologists for Better Government PAC. Every dollar helps, as the risk of non-involvement in the political process is getting too high to ignore.
Wisconsin Academy of Ophthalmology
563 Carter Court, Suite BKimberly, WI 54136Ph: 920-560-5645 • WAO@badgerbay.co
