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Get Your New Physician Non-Compete Agreements in Place

Act 273 of the 2024 regular session of the Louisiana Legislature becomes effective January 1, 2025. That Act drastically changes the law on non-compete agreements for most Louisiana physicians (but not all).

The new law distinguishes between “primary care physicians” and non-primary care physicians. “Primary care physician” is defined as those physicians who predominantly “practice general family medicine, general internal medicine, general pediatrics, general obstetrics or general gynecology.” For primary care physicians, a non-compete agreement cannot exceed three years from the effective date of the initial agreement. Thus, if the physician works continuously for the same employer for three years, the physician’s non-compete agreement evaporates at that point. Any subsequent agreement between the employer and the primary care physician executed after the initial three-year term cannot include a non-compete provision.

Additionally, a non-compete agreement with a primary care physician cannot prohibit the physician from competing in more than three parishes, including the physician’s principal practice parish and no more than two contiguous parishes in which the employer carries on a like business. Those parishes must be specified in the agreement. Finally, the prohibition cannot exceed more than two years from the date of termination of employment.

Within the three-year period from the effective date of the initial agreement with the primary care physician, a non-compete provision can be enforced if violated during that three-year period. It can only be enforced, however, if the physician terminates the agreement within that maximum three parish area for two years from the date of termination of employment.

For any physician other than a “primary care physician” as defined in the Act, a non-compete agreement cannot exceed five years from the effective date of the initial agreement. Any subsequent agreement between the physician and the same employer after the initial five-year term cannot include a non-compete agreement. The three-parish limit on the area of prohibition is equally applicable here. A non-compete agreement with a five-year limitation can be enforced if violated during that five-year period.

Neither the three- nor five-year limitations apply to physicians employed by or under contract with a rural hospital as defined in the Rural Hospital Preservation Act, or any physician employed by or under contract with a federally qualified health care center as defined in La. R.S. 40:1183.3 and which operates in a rural parish. For these physicians, the general law on non-compete agreements under La. R.S. 23:921 applies.

Because current physician non-compete agreements will not be limited to a three- or five-year term from agreement inception, as required by the new law, current agreements may be held invalid by Louisiana courts. New physician non-compete agreements in compliance with the new law are therefore critical to employers.

Get Your New Physician Non-Compete Agreements in Place

Act 273 of the 2024 regular session of the Louisiana Legislature becomes effective January 1, 2025. That Act drastically changes the law on non-compete agreements for most Louisiana physicians (but not all).

The new law distinguishes between “primary care physicians” and non-primary care physicians. “Primary care physician” is defined as those physicians who predominantly “practice general family medicine, general internal medicine, general pediatrics, general obstetrics or general gynecology.” For primary care physicians, a non-compete agreement cannot exceed three years from the effective date of the initial agreement. Thus, if the physician works continuously for the same employer for three years, the physician’s non-compete agreement evaporates at that point. Any subsequent agreement between the employer and the primary care physician executed after the initial three-year term cannot include a non-compete provision.

Additionally, a non-compete agreement with a primary care physician cannot prohibit the physician from competing in more than three parishes, including the physician’s principal practice parish and no more than two contiguous parishes in which the employer carries on a like business. Those parishes must be specified in the agreement. Finally, the prohibition cannot exceed more than two years from the date of termination of employment.

Within the three-year period from the effective date of the initial agreement with the primary care physician, a non-compete provision can be enforced if violated during that three-year period. It can only be enforced, however, if the physician terminates the agreement within that maximum three parish area for two years from the date of termination of employment.

For any physician other than a “primary care physician” as defined in the Act, a non-compete agreement cannot exceed five years from the effective date of the initial agreement. Any subsequent agreement between the physician and the same employer after the initial five-year term cannot include a non-compete agreement. The three-parish limit on the area of prohibition is equally applicable here. A non-compete agreement with a five-year limitation can be enforced if violated during that five-year period.

Neither the three- nor five-year limitations apply to physicians employed by or under contract with a rural hospital as defined in the Rural Hospital Preservation Act, or any physician employed by or under contract with a federally qualified health care center as defined in La. R.S. 40:1183.3 and which operates in a rural parish. For these physicians, the general law on non-compete agreements under La. R.S. 23:921 applies.

Because current physician non-compete agreements will not be limited to a three- or five-year term from agreement inception, as required by the new law, current agreements may be held invalid by Louisiana courts. New physician non-compete agreements in compliance with the new law are therefore critical to employers.

Get Your New Physician Non-Compete Agreements in Place

Act 273 of the 2024 regular session of the Louisiana Legislature becomes effective January 1, 2025. That Act drastically changes the law on non-compete agreements for most Louisiana physicians (but not all).

The new law distinguishes between “primary care physicians” and non-primary care physicians. “Primary care physician” is defined as those physicians who predominantly “practice general family medicine, general internal medicine, general pediatrics, general obstetrics or general gynecology.” For primary care physicians, a non-compete agreement cannot exceed three years from the effective date of the initial agreement. Thus, if the physician works continuously for the same employer for three years, the physician’s non-compete agreement evaporates at that point. Any subsequent agreement between the employer and the primary care physician executed after the initial three-year term cannot include a non-compete provision.

Additionally, a non-compete agreement with a primary care physician cannot prohibit the physician from competing in more than three parishes, including the physician’s principal practice parish and no more than two contiguous parishes in which the employer carries on a like business. Those parishes must be specified in the agreement. Finally, the prohibition cannot exceed more than two years from the date of termination of employment.

Within the three-year period from the effective date of the initial agreement with the primary care physician, a non-compete provision can be enforced if violated during that three-year period. It can only be enforced, however, if the physician terminates the agreement within that maximum three parish area for two years from the date of termination of employment.

For any physician other than a “primary care physician” as defined in the Act, a non-compete agreement cannot exceed five years from the effective date of the initial agreement. Any subsequent agreement between the physician and the same employer after the initial five-year term cannot include a non-compete agreement. The three-parish limit on the area of prohibition is equally applicable here. A non-compete agreement with a five-year limitation can be enforced if violated during that five-year period.

Neither the three- nor five-year limitations apply to physicians employed by or under contract with a rural hospital as defined in the Rural Hospital Preservation Act, or any physician employed by or under contract with a federally qualified health care center as defined in La. R.S. 40:1183.3 and which operates in a rural parish. For these physicians, the general law on non-compete agreements under La. R.S. 23:921 applies.

Because current physician non-compete agreements will not be limited to a three- or five-year term from agreement inception, as required by the new law, current agreements may be held invalid by Louisiana courts. New physician non-compete agreements in compliance with the new law are therefore critical to employers.

Get Your New Physician Non-Compete Agreements in Place

Act 273 of the 2024 regular session of the Louisiana Legislature becomes effective January 1, 2025. That Act drastically changes the law on non-compete agreements for most Louisiana physicians (but not all).

The new law distinguishes between “primary care physicians” and non-primary care physicians. “Primary care physician” is defined as those physicians who predominantly “practice general family medicine, general internal medicine, general pediatrics, general obstetrics or general gynecology.” For primary care physicians, a non-compete agreement cannot exceed three years from the effective date of the initial agreement. Thus, if the physician works continuously for the same employer for three years, the physician’s non-compete agreement evaporates at that point. Any subsequent agreement between the employer and the primary care physician executed after the initial three-year term cannot include a non-compete provision.

Additionally, a non-compete agreement with a primary care physician cannot prohibit the physician from competing in more than three parishes, including the physician’s principal practice parish and no more than two contiguous parishes in which the employer carries on a like business. Those parishes must be specified in the agreement. Finally, the prohibition cannot exceed more than two years from the date of termination of employment.

Within the three-year period from the effective date of the initial agreement with the primary care physician, a non-compete provision can be enforced if violated during that three-year period. It can only be enforced, however, if the physician terminates the agreement within that maximum three parish area for two years from the date of termination of employment.

For any physician other than a “primary care physician” as defined in the Act, a non-compete agreement cannot exceed five years from the effective date of the initial agreement. Any subsequent agreement between the physician and the same employer after the initial five-year term cannot include a non-compete agreement. The three-parish limit on the area of prohibition is equally applicable here. A non-compete agreement with a five-year limitation can be enforced if violated during that five-year period.

Neither the three- nor five-year limitations apply to physicians employed by or under contract with a rural hospital as defined in the Rural Hospital Preservation Act, or any physician employed by or under contract with a federally qualified health care center as defined in La. R.S. 40:1183.3 and which operates in a rural parish. For these physicians, the general law on non-compete agreements under La. R.S. 23:921 applies.

Because current physician non-compete agreements will not be limited to a three- or five-year term from agreement inception, as required by the new law, current agreements may be held invalid by Louisiana courts. New physician non-compete agreements in compliance with the new law are therefore critical to employers.

Get Your New Physician Non-Compete Agreements in Place

Act 273 of the 2024 regular session of the Louisiana Legislature becomes effective January 1, 2025. That Act drastically changes the law on non-compete agreements for most Louisiana physicians (but not all).

The new law distinguishes between “primary care physicians” and non-primary care physicians. “Primary care physician” is defined as those physicians who predominantly “practice general family medicine, general internal medicine, general pediatrics, general obstetrics or general gynecology.” For primary care physicians, a non-compete agreement cannot exceed three years from the effective date of the initial agreement. Thus, if the physician works continuously for the same employer for three years, the physician’s non-compete agreement evaporates at that point. Any subsequent agreement between the employer and the primary care physician executed after the initial three-year term cannot include a non-compete provision.

Additionally, a non-compete agreement with a primary care physician cannot prohibit the physician from competing in more than three parishes, including the physician’s principal practice parish and no more than two contiguous parishes in which the employer carries on a like business. Those parishes must be specified in the agreement. Finally, the prohibition cannot exceed more than two years from the date of termination of employment.

Within the three-year period from the effective date of the initial agreement with the primary care physician, a non-compete provision can be enforced if violated during that three-year period. It can only be enforced, however, if the physician terminates the agreement within that maximum three parish area for two years from the date of termination of employment.

For any physician other than a “primary care physician” as defined in the Act, a non-compete agreement cannot exceed five years from the effective date of the initial agreement. Any subsequent agreement between the physician and the same employer after the initial five-year term cannot include a non-compete agreement. The three-parish limit on the area of prohibition is equally applicable here. A non-compete agreement with a five-year limitation can be enforced if violated during that five-year period.

Neither the three- nor five-year limitations apply to physicians employed by or under contract with a rural hospital as defined in the Rural Hospital Preservation Act, or any physician employed by or under contract with a federally qualified health care center as defined in La. R.S. 40:1183.3 and which operates in a rural parish. For these physicians, the general law on non-compete agreements under La. R.S. 23:921 applies.

Because current physician non-compete agreements will not be limited to a three- or five-year term from agreement inception, as required by the new law, current agreements may be held invalid by Louisiana courts. New physician non-compete agreements in compliance with the new law are therefore critical to employers.

Get Your New Physician Non-Compete Agreements in Place

Act 273 of the 2024 regular session of the Louisiana Legislature becomes effective January 1, 2025. That Act drastically changes the law on non-compete agreements for most Louisiana physicians (but not all).

The new law distinguishes between “primary care physicians” and non-primary care physicians. “Primary care physician” is defined as those physicians who predominantly “practice general family medicine, general internal medicine, general pediatrics, general obstetrics or general gynecology.” For primary care physicians, a non-compete agreement cannot exceed three years from the effective date of the initial agreement. Thus, if the physician works continuously for the same employer for three years, the physician’s non-compete agreement evaporates at that point. Any subsequent agreement between the employer and the primary care physician executed after the initial three-year term cannot include a non-compete provision.

Additionally, a non-compete agreement with a primary care physician cannot prohibit the physician from competing in more than three parishes, including the physician’s principal practice parish and no more than two contiguous parishes in which the employer carries on a like business. Those parishes must be specified in the agreement. Finally, the prohibition cannot exceed more than two years from the date of termination of employment.

Within the three-year period from the effective date of the initial agreement with the primary care physician, a non-compete provision can be enforced if violated during that three-year period. It can only be enforced, however, if the physician terminates the agreement within that maximum three parish area for two years from the date of termination of employment.

For any physician other than a “primary care physician” as defined in the Act, a non-compete agreement cannot exceed five years from the effective date of the initial agreement. Any subsequent agreement between the physician and the same employer after the initial five-year term cannot include a non-compete agreement. The three-parish limit on the area of prohibition is equally applicable here. A non-compete agreement with a five-year limitation can be enforced if violated during that five-year period.

Neither the three- nor five-year limitations apply to physicians employed by or under contract with a rural hospital as defined in the Rural Hospital Preservation Act, or any physician employed by or under contract with a federally qualified health care center as defined in La. R.S. 40:1183.3 and which operates in a rural parish. For these physicians, the general law on non-compete agreements under La. R.S. 23:921 applies.

Because current physician non-compete agreements will not be limited to a three- or five-year term from agreement inception, as required by the new law, current agreements may be held invalid by Louisiana courts. New physician non-compete agreements in compliance with the new law are therefore critical to employers.