Future of physician noncompetes in Colorado: Existing agreements

On May 8, 2025, the Colorado General Assembly passed Senate Bill (SB) 25-083—a legislative ban on physician noncompete agreements—with little opposition and sent it to Governor Jared Polis. By the time this article goes to print, the governor will likely have decided whether to sign it into law.

Before the new bill

SB 25-083 presents the latest step in Colorado’s march toward severely restricting noncompete provisions in employment agreements (also known as restrictive covenants or covenants not to compete). If signed into law, the bill would prohibit employers from enforcing noncompete agreements against MDs, DOs, advanced practice registered nurses, dentists, and licensed midwives (collectively, healthcare providers).

Currently, Colorado law allows covenants not to compete for physicians in employment, partnership, or corporate agreements, but only to the extent that the covenants allow for the recovery of damages related to competition. In other words, physicians cannot be prevented from practicing medicine.

Healthcare practices often rely on the existing law and include liquidated damages provisions in employment and partnership agreements. These provisions establish a set amount of damages that physicians must pay if they leave their former practice to join a competing practice within a specific time and geographic area.