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AB 393

Revises provisions governing hospitals. (BDR 40-839)

2025 Regular Session Introduced by Hanadi Nadeem

Nevada AB 393 would prohibit most hospitals from employing physicians for practicing medicine, allowing only limited exceptions and adding penalties for violations.

(Pursuant to Joint Standing Rule No. 14.3.1, no further action allowed.)
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Bill Summary · AB 393

AB 393 (BDR 40-839) — Summary (Nevada version, As Introduced)

Author: Assemblymember Nadeem
Subject: Revises provisions governing hospitals (limits when hospitals may employ physicians)

Note: The materials provided also include a separate California AB 393 (Connolly) on state personal‑services contracts for physicians and psychologists. This summary covers the Nevada AB 393 (BDR 40‑839) titled “Revises provisions governing hospitals.”

Main purpose

To prohibit most hospitals and psychiatric hospitals in Nevada from employing physicians as employees for the active practice of medicine, while creating specific, limited exceptions; and to add enforcement mechanisms and penalties for violations.

Key provisions

  • Adds a new section to Chapter 449 of the Nevada Revised Statutes prohibiting a hospital or psychiatric hospital from employing a physician “for the purpose of engaging in the practice of medicine, homeopathic medicine or osteopathic medicine,” except as expressly allowed by law.
  • Authorizes limited exceptions where employment is permitted:
    • A physician participating in a graduate medical education program accredited by the Accreditation Council for Graduate Medical Education (or successor) (i.e., residents/fellows).
    • A physician employed by a hospital or psychiatric hospital that is owned or operated by State government.
    • Also preserves existing statutory authorizations elsewhere in NRS (e.g., county hospitals/hospital districts, nonprofit medical schools or research institutions, certain mental health facilities) that already permit hospital employment under those provisions (NRS 433.264, 433B.150, 450.180, 450.640, 630.365).
  • Clarifies that facilities exempted under NRS 449.0301 (e.g., church‑run spiritual healing facilities, certain federal facilities) remain exempt from the new prohibition.
  • Enforcement and penalties:
    • The Division of Public and Behavioral Health may suspend or revoke a hospital’s license for violations.
    • The Division may impose administrative penalties up to $5,000 per day for each violation, plus interest up to 10% per year.
    • The Division may seek injunctions against operating in violation; district attorneys are required to prosecute such actions on application by the Division.
  • Conforming and definitional changes to incorporate the new prohibition into the licensing and enforcement framework.

Who would be affected

  • Primary: Hospitals and psychiatric hospitals in Nevada—administrators and boards responsible for staffing and contracts.
  • Physicians: Would be affected in terms of employment classification (employee vs. independent contractor) and hiring practices.
  • State/regulatory agencies: Division of Public and Behavioral Health, Department of Health and Human Services, and county district attorneys (for enforcement).
  • Patients: Indirectly, through changes in staffing models and potential effects on access to care if staffing adjustments are required.

Procedural/timeline aspects and status

  • Introduced March 11, 2025; referred to relevant committees (Health & Human Services and others).
  • Advanced through committee and floor actions in 2025; enrolled and presented to the Governor on September 16, 2025.
  • Vetoed by the Governor on October 3, 2025 (consideration of veto pending per the record). Because of the veto, the bill did not become law unless the Legislature overrides the veto.

Potential impacts and considerations

  • Would formalize a limitation on hospitals employing physicians (codifying a prohibition where practice historically used contractor arrangements), potentially shifting hiring/compensation models toward contractor/independent contractor relationships except for specified exceptions.
  • Could reduce hospitals’ flexibility to directly employ physicians, with administrative and legal compliance costs for revising contracts and staffing policies.
  • Enforcement penalties (license suspension/revocation and daily fines) create strong regulatory incentives to comply.
  • Graduate medical education programs and state‑owned hospitals are preserved as employment exceptions to avoid disrupting residency training and public hospital operations.

If you would like, I can:
- Compare this Nevada bill to the separate California AB 393 materials included in your documents (Connolly) and provide a side‑by‑side summary of differences; or
- Draft a short analysis of likely operational steps hospitals would need to take to comply (employment policies, contract review, licensure risk mitigation).

Compiled from official sources — confirm details with the bill’s official record.

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