Here are six things to know about the new law:
1. The law, the Fair Contracting for Health Care Practitioners Act, still allows health systems and other employers to limit physicians, physician assistants, nurse practitioners and nurse anesthetists from taking from competitors for up to a year.
2. The bill was signed into law by Gov. Josh Shapiro in July; it also does not limit the geographic reach of noncompetes.
3. The law leaves existing restrictions from contracts signed in prior years in place.
4. State Rep. Dan Frankel introduced a bill in August 2023 that sought to ban all noncompete agreements for healthcare practitioners in the state. A subsequent version of this bill in 2024 allowed them for up to two years with 45 miles of geographic restriction.
5. The law says employers cannot enforce a noncompete against a physician who was dismissed, but it does not define “dismissed,” according to the Inquirer.
6. The law does allow noncompete enforcement when a practice is sold but is “unclear” on how noncompetes can be enforced when a physician sells their equity interest back to a practice when they wish to leave, the report said.
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