Colorado has passed a new bill regarding limitations on restrictive covenants (e.g., noncompete agreements), specifically in the healthcare industry.
Under current Colorado law, restrictive covenants are generally banned, but several exceptions exist, including for individuals in the healthcare industry. For example, there is an exemption that allows for noncompete agreements under specified conditions governing highly compensated workers. The new bill excludes from the highly compensated worker exemption a noncompete agreement or a nonsolicitation agreement that restricts the practice of medicine, the practice of advanced practice registered nursing, or the practice of dentistry in the state.
The bill also prohibits a restrictive covenant that prevents or materially restricts a health-care provider from disclosing to a patient to whom the health-care provider was providing consultation or treatment before the health-care provider’s departure from a medical practice the following information:
- The health-care provider’s continuing practice of medicine;
- The health-care provider’s new professional contact information; or
- The patient’s right to choose a medical provider.
The bill is effective on the 91st day after final adjournment of the general assembly (likely August 6, 2025).
