Do you own a home health care agency or nurse registry? Safeguard your referral sources through a non-compete agreement and enforce it!
The home health care industry generally includes businesses that provide skilled nursing, physical therapy, and other health-related services to homebound patients. If you run a home care company, you know that referrals are crucial. This is because patients typically seek out home care services after a referral from a “middle man,” such as a physician, hospital, or skilled nursing facility. As a result, home care companies hire marketing representatives to promote the companies and cultivate relationships with the middle men in hope of securing future patient referrals for their business.
Imagine that you hire such a marketing representative, train her, and give her access to your company’s internal referral source database, preferences, and strategies. Naturally, you want to protect your sources, so the representative signs a confidentiality and non-compete agreement as part of her employment contract. After some time, the representative quits, and all of a sudden you start receiving significantly less referrals from the sources that the representative worked on while employed by you. Coincidence? It turns out that the representative started working for your direct competitor and used her relationship with your precious referral sources to your competitor’s benefit, in direct violation of the non-compete agreement. Surely the law is on your side, right?