Just three years after passing a statute significantly restricting the enforceability of physician non-compete agreements, Indiana’s legislature has passed an amendment, Senate Enrolled Act No. 7. Senate Enrolled Act No. 7 would invalidate a significantly broader category of physician non-compete agreements entered into on or after July 1, 2023. Governor Eric Holcomb is expected to sign the bill into law.
Until 2020, Indiana generally did not regulate non-compete restrictions entered into by physicians any differently from other occupations.
In the absence of statutory regulation, however, the Indiana Supreme Court recognized the competing public policy considerations in support of and opposed to enforcement of physician non-competes. Cent. Ind. Podiatry, P.C. v. Krueger, 882 N.E.2d 723, 725 (Ind. 2008). The Court acknowledged the public policy concern that completely restricting physicians from practicing within a geographic area might interfere with the physician-patient relationship and impair a patient’s ability to exercise physician choice. Ultimately, however, the Court explained this was a policy question better left to the state legislature.
In 2020, the state legislature responded to that policy question by passing Pub. L. No. 93-2020 (codified in part as Ind. Code § 25-22.5-5.5). Ind. Code § 25-22.5-5.5 sets forth a laundry list of specific provisions required for any enforceable physician non-compete agreement originally...
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