Indiana 2025 Regular Session

Indiana Senate Bill SB0475 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	ES0475.1
2		-	April 3, 2025
3		-	ENGROSSED
	1	+	SB0475.1
	2	+	January 24, 2025
4	3		SENATE BILL No. 475
5	4		_____
6		-	DIGEST OF SB 475 (Updated ~~April 2~~, 2025 3:56 pm - DI ~~141~~)
	5	+	DIGEST OF SB 475 (Updated January 22, 2025 12:56 pm - DI 104)
7	6		Citations Affected: IC 25-22.5.
8	7		Synopsis: Physician noncompete agreements. Provides that beginning
9		-	July 1, 2025, a physician and a hospital, a parent company of a
10		-	hospital, or an affiliated manager of a hospital may not enter into a
11		-	noncompete agreement that interferes with the physician's ability to
12		-	treat the physician's patients.
	8	+	July 1, 2025, a physician and an employer may not enter into a
	9	+	noncompete agreement.
13	10		Effective: July 1, 2025.
14	11		Busch, Charbonneau, Johnson T,
15		-	Ford J.D., Jackson L, Qaddoura
16		-	(HOUSE SPONSORS — MANNING, JUDY, CASH)
	12	+	Ford J.D., Jackson L
17	13		January 13, 2025, read first time and referred to Committee on Health and Provider
18	14		Services.
19	15		January 23, 2025, amended, reported favorably — Do Pass.
20		-	January 27, 2025, read second time, ordered engrossed. Engrossed.
21		-	January 28, 2025, read third time, passed. Yeas 47, nays 2.
22		-	HOUSE ACTION
23		-	March 3, 2025, read first time and referred to Committee on Public Health. Reassigned to
24		-	Committee on Employment, Labor and Pensions.
25		-	April 3, 2025, amended, reported — Do Pass.
26		-	ES 475—LS 7333/DI 153 April 3, 2025
	16	+	SB 475—LS 7333/DI 153 January 24, 2025
27	17		First Regular Session of the 124th General Assembly (2025)
28	18		PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
29	19		Constitution) is being amended, the text of the existing provision will appear in this style type,
30	20		additions will appear in this style type, and deletions will appear in this style type.
31	21		Additions: Whenever a new statutory provision is being enacted (or a new constitutional
32	22		provision adopted), the text of the new provision will appear in this style type. Also, the
33	23		word NEW will appear in that style type in the introductory clause of each SECTION that adds
34	24		a new provision to the Indiana Code or the Indiana Constitution.
35	25		Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
36	26		between statutes enacted by the 2024 Regular Session of the General Assembly.
37		-	ENGROSSED
38	27		SENATE BILL No. 475
39	28		A BILL FOR AN ACT to amend the Indiana Code concerning
40	29		professions and occupations.
41	30		Be it enacted by the General Assembly of the State of Indiana:
42		-	1 SECTION 1. IC 25-22.5-5.5-1.1 IS ADDED TO THE INDIANA
	31	+	1 SECTION 1. IC 25-22.5-5.5-2.3 IS ADDED TO THE INDIANA
43	32		2 CODE AS A NEW SECTION TO READ AS FOLLOWS
44		-	3 [EFFECTIVE JULY 1, 2025]: Sec. 1.1. As used in this chapter,
45		-	4 "business entity" means a corporation, partnership, sole
46		-	5 proprietorship, professional corporation, limited liability company,
47		-	6 limited liability partnership, or any other company or organization
48		-	7 authorized to do business in Indiana.
49		-	8 SECTION 2. IC 25-22.5-5.5-1.2 IS ADDED TO THE INDIANA
50		-	9 CODE AS A NEW SECTION TO READ AS FOLLOWS
51		-	10 [EFFECTIVE JULY 1, 2025]: Sec. 1.2. (a) As used in this chapter,
52		-	11 "competition related penalties agreement" means a contract or a
53		-	12 contract provision between a physician and the physician's
54		-	13 employer that requires the physician to:
55		-	14 (1) pay financial amounts to the employer; or
56		-	15 (2) consent to equitable relief for the benefit of the employer;
57		-	16 due to the physician's practice of medicine after the employment
58		-	17 relationship has ended.
59		-	ES 475—LS 7333/DI 153 2
60		-	1 (b) The term does not include a contract or a contract provision
61		-	2 that requires the physician to:
62		-	3 (1) pay financial amounts to the employer; or
63		-	4 (2) consent to equitable relief for the benefit of the employer;
64		-	5 for reasons other than the physician's practice of medicine after
65		-	6 the employment relationship has ended.
66		-	7 SECTION 3. IC 25-22.5-5.5-1.3 IS ADDED TO THE INDIANA
67		-	8 CODE AS A NEW SECTION TO READ AS FOLLOWS
68		-	9 [EFFECTIVE JULY 1, 2025]: Sec. 1.3. (a) As used in this chapter,
69		-	10 "noncompete agreement" means a contract or contract provision
70		-	11 between a physician and the physician's employer under which the
71		-	12 physician agrees not to engage in the practice of medicine in a
72		-	13 specified geographic area for a specified period of time
73		-	14 immediately after the employment relationship has ended. The
74		-	15 term includes a competition related penalties agreement.
75		-	16 (b) The term does not include the following:
76		-	17 (1) A contract or a contract provision between a physician
77		-	18 and the physician's employer that requires the physician to:
78		-	19 (A) pay financial amounts to the employer; or
79		-	20 (B) consent to equitable relief for the benefit of the
80		-	21 employer;
81		-	22 for reasons other than the physician's practice of medicine
82		-	23 after the employment relationship has ended.
83		-	24 (2) An agreement not to solicit or hire employees of the
84		-	25 employer.
85		-	26 (3) An agreement not to solicit or transact business with
86		-	27 customers, clients, or vendors of the employer.
87		-	28 (4) A noncompete agreement made in connection with:
88		-	29 (A) the sale of:
89		-	30 (i) a business entity;
90		-	31 (ii) all or substantially all of the operating assets of a
91		-	32 business entity; or
92		-	33 (iii) a division or subsidiary of a business entity; or
93		-	34 (B) the disposal of an ownership interest in a business
94		-	35 entity;
95		-	36 when the physician is an owner of or a member or partner in
96		-	37 the business entity.
97		-	38 (5) A noncompete agreement originating outside of a
98		-	39 physician's employment relationship with the physician's
99		-	40 employer.
100		-	41 (6) A nondisclosure or confidentiality agreement.
101		-	42 SECTION 4. IC 25-22.5-5.5-1.4 IS ADDED TO THE INDIANA
102		-	ES 475—LS 7333/DI 153 3
103		-	1 CODE AS A NEW SECTION TO READ AS FOLLOWS
104		-	2 [EFFECTIVE JULY 1, 2025]: Sec. 1.4. As used in this chapter,
105		-	3 "originally entered into" means an agreement that is entered into
106		-	4 for the first time as of a specified date. The term does not include
107		-	5 an amendment to an existing agreement or the renewal of an
108		-	6 existing agreement.
109		-	7 SECTION 5. IC 25-22.5-5.5-1.6 IS ADDED TO THE INDIANA
110		-	8 CODE AS A NEW SECTION TO READ AS FOLLOWS
111		-	9 [EFFECTIVE JULY 1, 2025]: Sec. 1.6. As used in this chapter,
112		-	10 "practice of medicine" has the meaning set forth in
113		-	11 IC 25-22.5-1-1.1(a)(1) and IC 25-22.5-1-1.1(a)(2). The term does
114		-	12 not include executive, administrative, managerial, or directional
115		-	13 activities.
116		-	14 SECTION 6. IC 25-22.5-5.5-2.3 IS ADDED TO THE INDIANA
117		-	15 CODE AS A NEW SECTION TO READ AS FOLLOWS
118		-	16 [EFFECTIVE JULY 1, 2025]: Sec. 2.3. (a) This section does not
119		-	17 apply to a physician noncompete agreement originally entered into
120		-	18 before July 1, 2025.
121		-	19 (b) As used in this section, "hospital" has the meaning set forth
122		-	20 in IC 16-18-2-179(b).
123		-	21 (c) Notwithstanding any other law, a physician and:
124		-	22 (1) a hospital;
125		-	23 (2) a parent company of a hospital; or
126		-	24 (3) an affiliated manager of a hospital;
127		-	25 may not enter into a noncompete agreement that interferes with
128		-	26 the physician's ability to treat the physician's patients.
129		-	ES 475—LS 7333/DI 153 4
	33	+	3 [EFFECTIVE JULY 1, 2025]: Sec. 2.3. (a) This section does not
	34	+	4 apply to a physician noncompete agreement originally entered into
	35	+	5 before July 1, 2025.
	36	+	6 (b) Notwithstanding any other law, a physician and an employer
	37	+	7 may not enter into a noncompete agreement.
	38	+	SB 475—LS 7333/DI 153 2
130	39		COMMITTEE REPORT
131	40		Mr. President: The Senate Committee on Health and Provider
132	41		Services, to which was referred Senate Bill No. 475, has had the same
133	42		under consideration and begs leave to report the same back to the
134	43		Senate with the recommendation that said bill be AMENDED as
135	44		follows:
136	45		Page 1, delete lines 8 through 14.
137	46		and when so amended that said bill do pass.
138	47		(Reference is to SB 475 as introduced.)
139	48		CHARBONNEAU, Chairperson
140	49		Committee Vote: Yeas 10, Nays 2.
141		-	_____
142		-	COMMITTEE REPORT
143		-	Mr. Speaker: Your Committee on Employment, Labor and Pensions,
144		-	to which was referred Senate Bill 475, has had the same under
145		-	consideration and begs leave to report the same back to the House with
146		-	the recommendation that said bill be amended as follows:
147		-	Page 1, between the enacting clause and line 1, begin a new
148		-	paragraph and insert:
149		-	"SECTION 1. IC 25-22.5-5.5-1.1 IS ADDED TO THE INDIANA
150		-	CODE AS A NEW SECTION TO READ AS FOLLOWS
151		-	[EFFECTIVE JULY 1, 2025]: Sec. 1.1. As used in this chapter,
152		-	"business entity" means a corporation, partnership, sole
153		-	proprietorship, professional corporation, limited liability company,
154		-	limited liability partnership, or any other company or organization
155		-	authorized to do business in Indiana.
156		-	SECTION 2. IC 25-22.5-5.5-1.2 IS ADDED TO THE INDIANA
157		-	CODE AS A NEW SECTION TO READ AS FOLLOWS
158		-	[EFFECTIVE JULY 1, 2025]: Sec. 1.2. (a) As used in this chapter,
159		-	"competition related penalties agreement" means a contract or a
160		-	contract provision between a physician and the physician's
161		-	employer that requires the physician to:
162		-	(1) pay financial amounts to the employer; or
163		-	(2) consent to equitable relief for the benefit of the employer;
164		-	due to the physician's practice of medicine after the employment
165		-	relationship has ended.
166		-	ES 475—LS 7333/DI 153 5
167		-	(b) The term does not include a contract or a contract provision
168		-	that requires the physician to:
169		-	(1) pay financial amounts to the employer; or
170		-	(2) consent to equitable relief for the benefit of the employer;
171		-	for reasons other than the physician's practice of medicine after
172		-	the employment relationship has ended.
173		-	SECTION 3. IC 25-22.5-5.5-1.3 IS ADDED TO THE INDIANA
174		-	CODE AS A NEW SECTION TO READ AS FOLLOWS
175		-	[EFFECTIVE JULY 1, 2025]: Sec. 1.3. (a) As used in this chapter,
176		-	"noncompete agreement" means a contract or contract provision
177		-	between a physician and the physician's employer under which the
178		-	physician agrees not to engage in the practice of medicine in a
179		-	specified geographic area for a specified period of time
180		-	immediately after the employment relationship has ended. The
181		-	term includes a competition related penalties agreement.
182		-	(b) The term does not include the following:
183		-	(1) A contract or a contract provision between a physician
184		-	and the physician's employer that requires the physician to:
185		-	(A) pay financial amounts to the employer; or
186		-	(B) consent to equitable relief for the benefit of the
187		-	employer;
188		-	for reasons other than the physician's practice of medicine
189		-	after the employment relationship has ended.
190		-	(2) An agreement not to solicit or hire employees of the
191		-	employer.
192		-	(3) An agreement not to solicit or transact business with
193		-	customers, clients, or vendors of the employer.
194		-	(4) A noncompete agreement made in connection with:
195		-	(A) the sale of:
196		-	(i) a business entity;
197		-	(ii) all or substantially all of the operating assets of a
198		-	business entity; or
199		-	(iii) a division or subsidiary of a business entity; or
200		-	(B) the disposal of an ownership interest in a business
201		-	entity;
202		-	when the physician is an owner of or a member or partner in
203		-	the business entity.
204		-	(5) A noncompete agreement originating outside of a
205		-	physician's employment relationship with the physician's
206		-	employer.
207		-	(6) A nondisclosure or confidentiality agreement.
208		-	SECTION 4. IC 25-22.5-5.5-1.4 IS ADDED TO THE INDIANA
209		-	ES 475—LS 7333/DI 153 6
210		-	CODE AS A NEW SECTION TO READ AS FOLLOWS
211		-	[EFFECTIVE JULY 1, 2025]: Sec. 1.4. As used in this chapter,
212		-	"originally entered into" means an agreement that is entered into
213		-	for the first time as of a specified date. The term does not include
214		-	an amendment to an existing agreement or the renewal of an
215		-	existing agreement.
216		-	SECTION 5. IC 25-22.5-5.5-1.6 IS ADDED TO THE INDIANA
217		-	CODE AS A NEW SECTION TO READ AS FOLLOWS
218		-	[EFFECTIVE JULY 1, 2025]: Sec. 1.6. As used in this chapter,
219		-	"practice of medicine" has the meaning set forth in
220		-	IC 25-22.5-1-1.1(a)(1) and IC 25-22.5-1-1.1(a)(2). The term does
221		-	not include executive, administrative, managerial, or directional
222		-	activities.".
223		-	Page 1, delete lines 6 through 7, begin a new paragraph and insert:
224		-	"(b) As used in this section, "hospital" has the meaning set forth
225		-	in IC 16-18-2-179(b).
226		-	(c) Notwithstanding any other law, a physician and:
227		-	(1) a hospital;
228		-	(2) a parent company of a hospital; or
229		-	(3) an affiliated manager of a hospital;
230		-	may not enter into a noncompete agreement that interferes with
231		-	the physician's ability to treat the physician's patients.".
232		-	Renumber all SECTIONS consecutively.
233		-	and when so amended that said bill do pass.
234		-	(Reference is to SB 475 as printed January 24, 2025.)
235		-	VANNATTER
236		-	Committee Vote: yeas 8, nays 2.
237		-	ES 475—LS 7333/DI 153
	50	+	SB 475—LS 7333/DI 153