Relating to restrictions on covenants not to compete for physicians and certain health care practitioners.

Contracts

Immediate Audit Required. Standard healthcare employment templates are likely non-compliant.

• Physicians, Dentists, Nurses, PAs: You must amend templates to reflect:
• Duration: Maximum 1 year.
• Geography: Maximum 5-mile radius from the *primary* practice location.
• Buyout: Maximum amount cannot exceed the practitioner's total annual salary and wages.
• Exclusions: Contracts for medical directors or administrators *not* providing direct patient care are exempt and do not require amendment.

Hiring/Training

• Termination Protocols: HR and management must be trained that terminating a practitioner without "good cause" voids the non-compete. "Good cause" must be operationally defined in performance reviews and disciplinary documentation.
• Recruitment: Expect increased mobility of talent. Your competitors can now hire your staff within a 6-mile radius after only one year.

Reporting & Record-Keeping

• Buyout Substantiation: Finance departments must maintain clear ledgers of "total annual salary and wages" to justify the buyout price in the event of a contract dispute.
• Patient Lists: You must maintain the capability to generate a list of patients seen by the practitioner within one year of termination to satisfy continuing care requirements.
• Contract Visibility: The non-compete terms must be "clearly and conspicuously stated." Move these clauses out of general employee handbooks and into specific, signed addendums.

Fees & Costs

• Legal Spend: Budget for immediate outside counsel fees to redraft employment agreements.
• Retention Costs: Anticipate higher salary demands for renewals, as the non-compete acts as a weaker retention tool under the new law.