PA Healthcare Non-Compete Limits (2025)

Non-compete agreements have long been a flashpoint in healthcare employment. Pennsylvania addressed the issue directly with the Fair Contracting for Health Care Practitioners Act (HB 1633), signed by Governor Shapiro on July 17, 2024, and effective January 1, 2025.

What the Law Does

The Act applies to physicians (M.D. and D.O.), certified registered nurse anesthetists (CRNAs), certified registered nurse practitioners (CRNPs), and physician assistants (PAs). For agreements entered into on or after January 1, 2025, a non-compete covenant that restricts a covered practitioner’s ability to practice for more than one year is void and unenforceable.

If the employer terminates a covered practitioner, the non-compete is void entirely, regardless of its duration. This is a notable protection: practitioners who are fired cannot also be barred from practicing in their area.

Key Exceptions

The Act preserves non-compete enforceability in two situations. First, a non-compete of one year or less remains enforceable if the practitioner voluntarily resigned (as opposed to being terminated). Second, non-competes remain enforceable in connection with the sale of a business, a merger or acquisition, or a transaction in which the practitioner receives an ownership interest in the entity.

The Act also imposes patient-notification requirements on healthcare employers. When a covered practitioner departs, the employer must notify the patients that practitioner saw within the past year, and must do so within 90 days of the departure. This notification requirement applies to a practitioner who had an ongoing outpatient relationship with the patient of two or more years. The notice must state that the practitioner has left, explain how the patient may transfer records to another practitioner if the patient chooses to be treated elsewhere, and explain that the patient may be assigned a new practitioner within the practice if the patient wishes to continue receiving care from the employer.

The Act does not itself specify a private civil action, damages, attorney fees, injunctive relief, or civil penalties for a violation. A noncompete that exceeds what the Act allows is simply void and unenforceable; a practitioner facing an overlong covenant has that as a defense if the employer tries to enforce it, and can seek a declaratory judgment that the covenant is void rather than waiting to be sued.

What This Means for Non-Healthcare Non-Competes

The Act does not change the enforceability standard for non-compete agreements outside of healthcare. For other industries, Pennsylvania continues to enforce non-competes that meet the traditional requirements: a legitimate business interest, reasonable duration, reasonable geographic scope, and adequate consideration.

Courts continue to evaluate non-competes on a case-by-case basis, and the FTC’s attempted nationwide ban on non-competes was ultimately vacated. For now, the healthcare practitioner act is a targeted reform, not a general overhaul.

If you are a healthcare practitioner reviewing a non-compete, or a business owner drafting restrictive covenants, contact our office to discuss how the new law applies to your situation.

Legal and factual content on this page was last verified: Aug. 2026. If you are reading this significantly after that date, confirm key provisions with current statute text or contact our office.