This bill aims to restrict the use of employment covenants for licensed physicians, declaring that any contract or agreement that limits a physician's right to practice medicine in a specific geographic area after the termination of their professional relationship is void and unenforceable. However, the bill outlines specific exceptions where such restrictive covenants may still be valid. These exceptions include restrictions related to joining hospital systems or group practices of a certain size, limitations on practicing near federally qualified health centers, and covenants tied to unique incentives provided by the hospital system or group practice.

The bill also clarifies that the term "unique incentive" can encompass various factors, such as starting new programs, providing substantial signing bonuses, or establishing new practice groups. The legislation is set to take effect immediately and will apply to contracts and agreements entered into by physicians after the effective date.