Skip to main content
Top Button
New Physician Non-Compete Provisions New Physician Non-Compete Provisions

New Physician Non-Compete Provisions

Effective July 1, 2020, a new Indiana law will require certain provisions to be included in physician non-compete agreements in order for the non-compete provisions to be enforceable. The new elements apply only to physician non-compete agreements entered into on or after July 1, 2020. Physician non-compete agreements entered into before July 1, 2020 are not required to contain the new provisions set forth below.

The first new provision that must be included in physician non-compete agreements is one that requires a physician’s employer to provide the physician with a copy of any notice that concerns the physician’s departure from the employer and which is sent to any patient seen or treated by the physician in the two-year period preceding the physician’s termination of employment. Patients seen or treated by a physician in the preceding two years are sometimes referred to under Indiana law as “active patients.” Patient names and contact information must be redacted from the notice provided to the physician. The second new provision requires the employer to, in good faith, provide the physician’s last known or current contact and location information to any active patient who requests such updated information for the physician.

Physician non-compete agreements must also contain a provision that provides the physician with access to or copies of the medical records of an active patient when the patient provides consent. Employers are prohibited from providing patient medical records to a requesting physician in a format that materially differs from the format used to create or store the medical record during the routine or ordinary course of business, unless a different format is agreed upon by the parties in the non-compete agreement. The new statutory language specifically states that paper or PDF copies of medical records satisfy the formatting provision and that a person or entity who is required to create, copy or transfer a patient medical record under the new law may charge a reasonable fee for the service as permitted by applicable state or federal law.

Finally, under the new law, physician non-compete agreements are required to contain a provision that provides the physician with an option to purchase a complete and final release from the terms of the physician non-compete agreement at a reasonable price. The statute does not define “reasonable price” or provide a formula or mechanism for how a reasonable price might be calculated by the parties. If the physician elects not to exercise the purchase option, then the option-to-purchase provision may not be used in any manner to restrict, bar or otherwise limit the employer’s equitable remedies, including the employer’s enforcement of the non-compete agreement.

If you should have any questions about the new Indiana law governing physician non-compete agreements, please contact Margaret Emmert at Margaret.Emmert@icemiller.com or Taryn Stone at Taryn.Stone@icemiller.com.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances.
 

 

View Full Site View Mobile Optimized