U.S. Congress introduces legislation to limit corporate control of physician practices

Democratic lawmakers in the U.S. Congress have introduced the Stop Corporate Takeovers of Physicians Act of 2026. The legislation seeks to establish a federal framework for the corporate practice of medicine, an area traditionally regulated by individual states.

The Act aims to limit the ability of private equity firms, insurance companies, and other for-profit non-clinician entities to own or control physician practices and influence clinical decision-making. Under the proposal, ownership and control would generally be restricted to state-licensed physicians and eligible clinicians actively engaged in patient care. Certain nonprofit healthcare providers, public healthcare providers, and hospitals—including critical access and rural emergency hospitals—would be exempt from the core ownership restrictions.

Additionally, the bill proposes a ban on all non-compete clauses for employed physicians, which would retroactively void existing agreements one year after enactment. The legislation also targets nondisclosure and non-disparagement clauses. Hospitals found enforcing such restrictive covenants could face regulatory fines, private lawsuits, or exclusion from Medicare and Medicaid. While the bill reflects growing scrutiny of physician-practice ownership, it was introduced late in the congressional session and currently lacks bipartisan support.