Florida Senate - 2022 CS for SB 842 By the Committee on Health Policy; and Senator Brodeur 588-02342-22 2022842c1 1 A bill to be entitled 2 An act relating to invalid restrictive covenants in 3 health care; amending s. 542.336, F.S.; defining the 4 terms “hospital” and “physician”; specifying that 5 certain restrictive covenants in employment agreements 6 between physicians and hospitals do not support a 7 legitimate business interest; providing a legislative 8 finding; providing applicability; providing an 9 effective date. 10 11 Be It Enacted by the Legislature of the State of Florida: 12 13 Section 1. Section 542.336, Florida Statutes, is amended to 14 read: 15 542.336 Invalid restrictive covenants.— 16 (1) As used in this section, the term: 17 (a) “Hospital” means a hospital as defined in s. 18 395.002(13) which is licensed under chapter 395 and part II of 19 chapter 408. 20 (b) “Physician” means a person licensed to practice 21 medicine under chapter 458 or osteopathic medicine under chapter 22 459. 23 (2) A restrictive covenant entered into with a physician 24
who is licensed under chapter 458 or chapter 459 andwho 25 practices a medical specialty in a county wherein one entity 26 employs or contracts with, either directly or through related or 27 affiliated entities, all physicians who practice such specialty 28 in that county is not supported by a legitimate business 29 interest. The Legislature finds that such covenants restrict 30 patient access to physicians, increase costs, and are void and 31 unenforceable under current law. Such restrictive covenants 32 shallremain void and unenforceable for 3 years after the date 33 on which a second entity that employs or contracts with, either 34 directly or through related or affiliated entities, one or more 35 physicians who practice such specialty begins offering such 36 specialty services in that county. 37 (3) A restrictive covenant in an employment agreement 38 between a physician and a hospital is not supported by a 39 legitimate business interest if it does not include an option 40 for the physician to buy out of the restrictive covenant. The 41 Legislature finds that a restrictive covenant without this 42 option limits patient access to physicians and increases costs 43 and is void and unenforceable. This subsection applies to 44 restrictive covenants entered into on or after July 1, 2022. 45 Section 2. This act shall take effect July 1, 2022.