Louisiana has limited the time and scope of noncompete agreements for physicians. For primary care physicians, all provisions in an employment contract or agreement that restrain them from practicing medicine may not exceed three years from the effective date of the initial contract or agreement. And any subsequent contract or agreement between the employer and primary care physician executed after the initial three-year term may not include noncompete provisions.
For all other types of physicians, noncompetes cannot exceed five years from the effective date of the initial contract or agreement.
Regarding scope, physicians may be prohibited from carrying on or engaging in a business similar to that of the employer in the parish in which the physician’s principal practice is located and no more than two contiguous parishes in which the employer carries on a like business. The parishes must be specified in the contract or agreement. The prohibition may not exceed a period of more than two years from termination of employment.
These restrictions do not apply to the following:
- Any physician who is employed by or under contract with a rural hospital as provided for in the Rural Hospital Preservation Act; and
- Any physician who is employed by or under contract with a federally qualified healthcare center as defined in and which operates in a rural parish at the time the physician is hired.
The restrictions are effective January 1, 2025.
