Transcribed from The Financial Cocktail Podcast Episode 10.
Opening Bit…
Anesthesia training doesn’t prepare you for contract negotiations. Way too many CRNAs sign the most important financial document of their career after a five-minute skim.
Welcome back to The Financial Cocktail. I’m your host, Leland Murren. Today is about contracts, and how they turn your training into wealth.
Negotiation is a skill, not a personality trait. That means you can learn it and get better at it over time. Let’s walk through how I personally approach an offer on the table: a W-2 contract with a big healthcare system, and my current setup for locum contracts. We’ll look at it as if I’m the one sitting across the table right now, with every consideration I have.
Before anesthesia school, I studied how to study. I wanted to be efficient and proficient by the time school actually started, and audiobooks were one of the ways I took in content at a pretty good rate with moderate-to-high retention. I’ve read many books on personal finance, investing, and business, and many of them form the foundation of The Financial Cocktail.
Several of the principles in this episode come from my own negotiation experience and from Chris Voss’s book, Never Split the Difference. I listened to it years ago and have used its teachings many times since. Without a doubt, it shaped how I think about anchoring, leverage, and all things negotiation, and it has put hundreds of thousands of dollars in my pocket since I started my anesthesia career.
The Basics
Let’s start with some basic points of negotiation.
• Know your number before you start. Know what you want, which hill you’re willing to die on, and where you have room to flex. Have minimums in mind so you know when it’s a lost cause and when to walk away.
• Get everything in writing. No verbal promises. No “we’ll address this after a year or so.” If it’s not in writing, it doesn’t exist. And even if it is in writing, it still may not happen.
• Understand your leverage. What’s the supply-and-demand situation? Is this a desirable location or a desirable job with low turnover, where the facility has the leverage? Or is it somewhere with chronic staffing needs, a geographically disadvantaged spot, a tough job, a place that has been hurting for staff for years and can’t seem to fill its anesthesia department?
• Ask open-ended questions. “How am I supposed to make that work?” “How can you expect me to drive five hours each way to cover 36 hours of call for that rate?”
• Use if-then trades. “If you can’t increase the sign-on bonus, can you include a relocation bonus?”
• Always leave on good terms. If you come out ahead, don’t rub it in their face. If you made too many concessions, don’t be bitter about your own poor preparation. You never know what the future holds, where you’ll end up, or who will hold a certain contract.
Keep all of these basics in mind as I go through my contract negotiation process.
1. The Golden Ticket: The Ability to Say No
We’re starting with the golden ticket, the magic card, the one thing that trumps all others: the ability to say no. This is your single biggest source of leverage, and it has been my biggest source of leverage in every one of my contract negotiations. It’s not a spreadsheet or a script. It’s genuine flexibility.
My wife and I could go anywhere, at any time, for any reason. It didn’t matter. We had no house to sell, no school district to stay in, no kids with friend groups, and no single metro area we were tied to. That flexibility, more than any data point, was my real negotiating power. The jobs we were comparing were competing against literally every other job on the market. You want to talk about leverage? That’s your leverage right there.
If you need a job in a specific location for family or lifestyle reasons, that’s a legitimate trade-off. Just be aware that you’re limited and have less negotiating power. Name that honestly instead of bluffing with an “I’ll walk away if you don’t do XYZ” that you can’t actually follow through on.
The single most important tool in any negotiation is the ability to say no. Everything else in this episode supports that one point. A term you might hear is BATNA, your best alternative to a negotiated agreement. It simply means knowing what happens if the deal falls through: your contingency, your plan B.
2. Every Number Is a Talking Point
For my first W-2 job, I sent the contract to a family friend who is a CFO, and he was big on this: every single number in the entire contract can be negotiated, even if your request isn’t ultimately accepted. It’s amazing how many parts of a position are negotiable.
Chris Voss digs into this with anchors. The hospital or agency will use anchors, and you, as the contractor or employee, will use anchors too. An anchor is an attempt to pull the number toward your side. Say the offer is a $225,000 salary when the market average in the area is $250,000.
Expect that first offer to be low. That’s the hospital setting the anchor. It gets your mind off the $250,000 market average and onto $225,000, a 10% shave right off the top.
You need to take the emotional hit and not react, because every increase from there will feel like a win, even if it’s still below the role’s real value. There are a few ways to approach this, and going after the core salary might not be the best one. We might not get the salary up to $275,000, but there are other things we can do, which we’ll get to.
During this process, look at it from the employer’s side too. Places that are hard to staff, remote, or undesirable for any number of reasons tend to pay more. Desirable cities often come with their own cost-of-living tax, the “sunshine tax.”
Through all of it, never let a negotiation damage the relationship while you try to pull them off that low anchor. Anesthesia is a small specialty, and today’s counteroffer can become tomorrow’s reference for a locum assignment.
What large health systems actually move on
Yes, every number is a talking point. But what do big systems actually move on? When I evaluate an offer, salary is usually the least flexible line on the page. Often there’s a stair step: X years of experience means you start at Y dollars. That’s where a $225,000 offer against a $250,000 area average comes from.
You might be stuck there because of your years of experience, and they may not budge because it could upset the rest of the staff. Or the facility may pay everyone the same. I’m seeing more of that standardization at big Midwest health systems. Every place does it a little differently, and that affects what’s negotiable.
• Sign-on bonus and relocation assistance. These tend to be more flexible. At my first job, the sign-on bonus was capped, so I used an if-then. They said, “We can’t go up on the sign-on bonus, but we can give you a $10,000 relocation stipend and lump it in as a sign-on add-on.” Perfect. That worked for me.
• Loan repayment, retention bonuses, periodic bonuses. All of these can be negotiated.
• CME allowance and CME days. The allowance usually runs $1,000 to $5,000. Do you get time for a conference, a nerve block course, an epidural course? Find out what qualifies. One place I looked at ran a pain practice where each CRNA rotated in about one day a week, with four days in the OR. They offered an extra $5,000, after roughly nine months to a year, for a five-day pain course so you could come back and do fairly simple pain injections. That $5,000 was in writing, on top of my annual CME allowance, and the time frame was in writing too. Very important. We’ll touch on that later.
• PTO structure and call frequency. Know everything about PTO: how it’s scheduled and whether you can take consecutive weeks. Call frequency is another big one. Weeknights, weekends, shifts per week, per month, per year: how does it work? If I’m a new grad starting in July, how many call shifts do I take? When does my PTO start? When does sick leave start? How much CME do I get that first year? All negotiable.
• Extra shift rate. This was a big one for me at my first job. They called it a $500-per-night beeper rate, which was pretty good at the time. They had basically plugged in locum-style numbers even though we were W-2. I pointed out that the rate didn’t have a separate rate for 24-hour call on a Saturday or Sunday. They said, “We’ve never had to address this. It’s never been an issue. We’ve always had PRN people or locums pick up the coverage.” They said they’d look at market rates and get back to me, and they settled on $2,000 per 24-hour call on Saturday and Sunday.
Sure enough, about six months in, we lost half our staff and went to call every other day and every other weekend. That affected my compensation significantly that first year. I ended up taking roughly 12 or 13 extra weeks of call, and instead of $1,000 to cover a weekend, it was $4,000, all because of one small question. Don’t let “it’s never happened before” convince you something doesn’t need to be addressed. It really does.
3. The Non-Number Terms
You can also negotiate parts of the contract that have nothing to do with numbers, and these can be easier to win, especially with large health systems. As a locum, I probably negotiate five points of wording for every one point of rate. If the rate isn’t where I need it, I don’t pursue the contract at all, so that filters itself out before I start. Here are some of the non-number terms:
• Start date flexibility. As a new grad, this could influence your decision quite a bit.
• Orientation and training. This was a big one for me because I had a heavy orientation. We looked at when it started, what it looked like, and who would be there if I needed help. My pay was different during orientation: an hourly rate, then salary afterward. We put it in writing. Orientation was three months, signed off by the chief. It could end earlier if the chief signed off, or run longer if the chief recommended it. That affected my pay because I had a reduced rate during that time.
Clinically it didn’t affect me much because I had a fair number of hours, but it did affect my take-home pay. Get it in writing: when you start taking call, whether someone has to be available at all times, whether someone is on second call with you, and so on.
• Schedule format. Five 8s, four 10s, three 12s, whatever it is, plus your weekend rotation. Negotiate all of it.
• Post-call days off. At the facility where I’m a locum now (this doesn’t apply to me), the permanent staff were told they’d get a one-to-one post-call day off. Cool: call on Monday, Tuesday off, back in the OR Wednesday. Then they took Friday, Saturday, and Sunday call for their weekend and said, “So I get Monday, Tuesday, and Wednesday as post-call days, right?” HR said no, that counts as one. Wait. If I take Wednesday call, I get Thursday off, but if I take Friday through Sunday, I only get Monday? “Yeah, just Monday.” How does that make sense when you told me it was one-to-one?
It makes a big difference. I think their call is around one in six, so ballpark nine weekends a year. A true one-to-one would be 27 post-call days. The hospital is saying nine. That’s 18 days riding on whether it’s truly one-to-one when weekends are clustered. At even a modest daily rate of $1,200, that’s roughly a $20,000-a-year difference, and that doesn’t count what you could do with those days, like picking up local work. Good thing to have in writing.
• Can your PTO be revoked? Some places schedule PTO, end up short-staffed, and say, “Actually, it’s not a great week for PTO. It’s off.” That’s not cool when you have a vacation planned, with hotel rooms and flights booked and ready to go.
• Are extra shifts forced? When do locums get brought in? Will you make the permanent staff cover extra call if you go short? History will tell you more than HR will, because HR might tell you what you want to hear. There are two neighboring health systems in the area where I work. One brings in locums much earlier than the other.
They’re fine with higher expenses to keep their permanent staff satisfied, so if they promised one-in-four, one-in-six, or one-in-ten call, they’ll bring in locums to keep that promise rather than frustrate the group and lose more staff.
4. The Non-Negotiables Worth Reading Closely
Even when I can’t change these terms, they determine my risk exposure. They’re a bit more negotiable on the 1099 side, but either way, slow down and read them.
• Non-compete radius and duration. This varies a lot from state to state, and there’s a lot of discussion about it. Take a close look.
• Malpractice coverage type. Is it claims-made, or a somewhat bulkier occurrence policy? The lawyers will ultimately do what’s best for whoever holds the coverage, which is the hospital. If there’s a corneal abrasion or a couple of damaged teeth, they’ll settle out of court, which brings me to the next point.
• Consent to settle. It’s best if your written consent is required to settle, because settlements go on your record under your NPI number. It can cost the hospital a lot less to pay $500 or $1,000 to settle something, even an entirely fabricated claim, than to go to court. But because it’s tied to your NPI, you’ll get flagged when you apply for jobs elsewhere. If you’re a locum moving from place to place and going through credentialing often, a consent-to-settle clause matters a lot. Carrying your own occurrence policy eliminates a lot of headaches: it puts you in control, and the lawyers are on your side.
• Tail coverage. Claims-made coverage only covers you for the duration of the policy. You can buy tail coverage, so find out who pays for it. Are you, the CRNA, responsible for your own tail, or is it part of the benefits? It’s really important that your coverage doesn’t lapse when you change jobs or employers.
• Termination clauses, with and without cause. Some are fairly liberal, and how they’re written depends on the state; some states are more employer-friendly, some more employee-friendly. If you’re terminated without cause, I think it’s important that you get some notice or compensation. For termination with cause, you need to know what “cause” means. It’s usually tied to violating the policies and procedures handbook, a 500- or 1,000-page document nobody actually reads, so they can get you for pretty much anything.
That’s why it’s always best to have a big emergency fund for the day they let you go over something that’s kind of a BS claim but still counts as “with cause” under their bylaws. Read it. Find out what you can be let go for and what the notice period looks like on their end. Also note what it looks like on your end: do you owe 60, 90, or 120 days’ notice?
• Restrictive covenants tied to your bonus. This is your clawback. I believe Lincoln, Nebraska at one time had a clawback where, if you didn’t finish your full five-year commitment, you paid back the entire sign-on bonus. Most are prorated month by month. Mine was a three-year sign-on, and I owed back 1/36th for every month I fell short. That’s fairly reasonable and definitely the way to go if you can get it.
• 401(k) match. Generally not negotiable, because it’s set for all employees. Changing it for you means changing it for everyone, which probably isn’t going to happen.
5. Productivity Bonuses
These are structured in all kinds of ways: total cases, CPT counts, certain metrics being met. Find out whether it applies to you, how the productivity bonus or incentive pay actually works, and why it matters more at some systems than others. Ask HR every question before assuming, “Last year each of the CRNAs got a $10,000 bonus, so we’ll all get $10,000 again this year.” It’s rarely guaranteed, and in the hospital systems I’ve seen, it’s generally on its way out.
6. Build Your Own Anchor
Before I counter anything or set my anchor, I need real comparisons across every offer. That means total compensation, not just base salary. The line items to look at:
• Base wage. The biggest one, the “magic ticket” everybody gets way too fixated on.
• Sign-on and relocation bonuses. Really big for new grads, and one reason it can pay to change jobs a bit. Keep in mind these sign-on bonuses are often spread over four or five years.
• Expected hours. Is this a job where they expect 50 hours a week? At my first job, the anesthesia group’s contract with the hospital said they’d run ORs until 1700, while our contract said we’d drop down to one room after 1500. That sounds like nitpicking, but it’s the difference between guaranteeing a 40-hour week and a 50-hour week.
• Call pay. Are you 100% salaried? Is call included? Are callbacks and overtime included, or paid separately? Look at overtime, call pay, callback hours, and holidays.
• Benefits. What retirement plan and match are offered: a 401(k), a 457? What does malpractice cover?
• Taxation. W-2 is fairly straightforward. We’ve covered W-2 versus 1099 in other episodes, and they are definitely not apples to apples. A 1099 role typically needs to pay 20% to 30% more just to break even with a comparable W-2 offer once self-employment tax and self-funded benefits come out.
With a real, adjusted take-home number for each offer, I do direct market comparisons: calls to comparable facilities, job postings, and locations, as close to apples to apples as I can get.
Then I set my own anchor. It’s a specific, usually non-round number, not a benchmark I just accept. The data tells me what’s defensible to ask for. You don’t want to be totally ridiculous, and if you are, you should know you’re being ridiculous, because I’ve done that before.
At the end of the day, if the total comp doesn’t work and they can’t get to the number you need, you have to be able to walk away for your number to stick. You already know what you need because you did the research: what the rates could and should be, and what you need to pay your bills, cover your overhead, and meet your retirement goals.
Say the market is $250,000, they’re offering $225,000, and you ask for $275,000 based on this site, that site, and the other site. If they won’t budge from $225,000, you say, “That actually doesn’t work for me. We can revisit this in future years, but right now I’m unable to sign at these numbers.”
SRNAs: collect offers from each of your clinical sites. Even when they joke, “Hey, you should come on full-time,” ask to see the compensation and benefits package. There’s nothing wrong with taking a look and adding it to a spreadsheet. That’s exactly what I did, and it’s how I knew what every local facility was paying.
Always expect a counteroffer. They’re at $225,000, you’re at $275,000, and the result will likely land somewhere in the middle. Be ready to explain what produced your $275,000. Maybe the benefits, call, or PTO are different, or maybe it’s a better area geographically (be careful with that one).
And watch out for the line, “We’ve given you a fair offer.” That’s a big guilt tactic, not a data point, and the only real answer is your own market research. Any time the word “fair” comes out, it’s usually not in your favor.
7. The Locum Contract
When I look at a locum assignment, things change a bit. These are the things I go through line by line.
• The rates come first. To even get into a negotiation, I need to know the rates are there: hourly, daily, call, callback, overtime. It all has to be there before I’ll talk to a recruiter or a hospital. I get way too many inquiries saying, “You should come work at XYZ hospital in XYZ state.” You can be on the phone with recruiters all day. Get the rates in the ballpark of what you need before you start negotiating.
• Guaranteed minimum hours. Whether it’s eight, six, or four hours a day. Four isn’t usually in my ballpark. The Midwest commonly does eight, so eight is what I want, and without it the job usually isn’t worth it. Even if they say, “It’s extremely rare that we’re done before three o’clock,” it doesn’t matter. I want a guaranteed minimum because that’s how I operate.
• Cancellation and no-call/no-show clauses. This is essentially who carries the risk if something happens. I like a 30-day cancellation. As I record this in mid-September, if you don’t need me a month from now, cool, you don’t need my November hours. Call me and I’ll try to get scheduled somewhere else. No harm, no foul. Same for me: if something comes up in my life or I book a weekend, I give the hospital 30 days’ notice.
The reason is that I’ve committed my time to you. I passed on all the other hospitals and surgery centers to give you my time, and I can’t get credentialed anywhere five days out, so my chances of picking up that day are next to nil. Make sure there’s a cancellation clause to protect yourself and keep income coming in.
• Travel and housing. This varies a lot: hospital-supplied, reimbursed, stipend, or an all-inclusive rate. Do whatever works for you. A stipend is by far the easiest: you get the dollars and spend them as you choose. With reimbursement, look at what you have to submit (photo or PDF receipts by email; they probably won’t accept a credit card statement), how and when they reimburse, and what they cover. Every rental car? All housing, including Airbnbs, or only certain hotels? A lot goes into this, and it’s pinched me in the past, so I find it much easier to take a stipend.
• Malpractice coverage. Getting your own is far easier, especially as a locum. You have to prevent coverage gaps, and with a good occurrence policy you really don’t have to worry about it. Facilities will want you to carry a certain minimum so they aren’t a bigger target than you are. They want everybody’s pockets to be the same depth. That’s the harsh reality. I think a lot of states require $200,000/$600,000, but I’ve been seeing $1 million/$3 million. Look into that on your own.
• Credentialing timeline. Who bears the cost of delays? If we’re planning a January 1 start, what’s my guarantee that it actually happens? If you submit paperwork December 1, that’s cutting it close. Right now it’s September, maybe October by the time this episode is released. If I’m three to four months out, what’s my guarantee that I can start January 1 or February 1?
• Contractor, not employee. Remember you’re looking through the 1099 locum lens. Facilities will try to send you all their orientation material and onboarding documentation. If it doesn’t relate to the actual credentialing process (licensure, your DEA, and getting through the hospital’s credentialing committee), you shouldn’t have to worry about it. Those are things employees do. If you want me to do them, pay me my overtime rate, because I’ll be doing it after work at my current assignment.
So I don’t do orientation and onboarding. That said, I’ve worked with quite a few charting systems, so I discuss ahead of time that I have some proficiency in paper charting, Epic, Meditech, and a handful of others. Stay a contractor, not an employee, and don’t get into misclassification issues.
8. Agency Dynamics
Locum agencies ultimately represent the facility, because that’s who hires them. They don’t represent you. Keep that in mind. Everybody is in it to make money: the hospital, the agencies taking their cut off your work, and you. Not a lot of you are working for free, I’m fairly sure.
Sometimes agencies try to play it off like they’re not in it for money. Guys, you’re literally a business. It’s fine. Just admit that if I’m working for $250, you’re billing $300 or $325. I get it. You have exclusive rights to the job, and I need you to get into it. It’s all good.
Agencies generally handle credentialing and paying you, acting as a middleman, and they get a little spicy when you go around them directly to the hospital. Every agency is different; some have good reputations and some don’t. What I look at: if I get canceled, how and when does it happen? If they say I have dates booked, will I actually work them? That’s important to me. And I want to be paid accurately and on time. All of that is in the contract.
If you go direct to the hospital, it helps to know agency margins. I’ve heard they run 18% to 30% on top of your rate, so if you’re taking $250, they’re probably billing closer to $325. I think margins have tightened a bit. In that case, at $250 an hour going direct, you might be able to get to $275 or $280.
Splitting the difference generally works out well for both parties. Then you’re dealing with someone at the hospital, whether that’s an internal recruiter, an HR person, or the CFO. Find your person and negotiate with them.
9. Reject Respectfully and Walk Away When It’s Called For
Whether it’s an agency, a hospital, or anyone else, you need to decline respectfully and walk away when it’s called for. Not every offer will close, and that’s totally fine. A clean, respectful decline is what keeps the door open for a future locum shift or referral.
I’ve been in the locum market a fairly short time compared to many CRNAs, and I’ve already seen things come full circle, with inquiries from places I’ve already worked. I’m really glad I have good relationships there. Work hard while you’re there, be a good sport, do what they need you to do. At the end, there are no hard feelings and no burned bridges: “I’ve really enjoyed my time here. You’ve been great to work with. If your needs still include locums as part of everyday staffing and my situation allows, I’d love to come back.”
And if a facility says the numbers are final and they’re still short of what I need, I say, “Thank you so much for your time,” and I walk away. That’s the ability to say no, put into practice.
10. Contract Attorneys and AI
Contract attorneys are a viable option. The CFO who looked over my first contract was great. He put everything in plain terms and did more than I could have asked. But contract attorneys are out there, and hiring a professional gives you a sense of security. After you’ve read a few contracts, you start to understand what to expect and the business language they commonly use.
Lately, I’ve leaned on AI to review my contracts. I open Claude and enter a prompt that starts something like this:
“Hey Claude, you are an amazing contract attorney with an unparalleled eye for detail. Please look over this contract and highlight every single way it is disadvantageous to my LLC. Include what you would change to eliminate each disadvantage, and give me the wording I should use to make the contract more favorable.”
This has been fantastic. You can also ask Claude, or whatever AI you use, to put it in plain terms: What does this mean? What is this section getting at? Is this common wording or unusual? Is it state-specific? Help me understand this. AI does a pretty good job. Flawless? Absolutely not. But it gives you a rough idea of where to start, maybe good enough to take some notes and send to a colleague who can help you through it.
You can always hire a contract attorney, but I don’t know many people who do it for every contract. Some do it for the first one. Some do it if they expect to stay at a job 10-plus years and won’t be signing a bunch of contracts. That’s great. I sign a handful of anesthesia contracts a year, and I also run my Furnished Finder leases and any other contracts through AI. It’s a bit of a cheat code that gets me down the road: very cost-effective, very fast, and it gives me feedback on the wording.
One issue I’ve found: when an agency says it doesn’t cover malpractice, Claude flags that as a benefit some people in my industry have. But I want to cover my own malpractice. I want my attorney fighting for me. So even though Claude suggests it, I won’t change it. Read past it. Don’t just copy and paste AI output; nothing good comes from that. It gives you a good start and something to work from.
Final Thoughts
Whether it’s a health system offer or a locum assignment, the contract is the first financial decision of the job, and you want to get it right on day one. It’s not something they’ll revise once you’re up and running. A high income only becomes wealth through decisions like this one: a contract that’s reasonably fair to both parties and not stacked against you.
Every contract I’ve signed to this day, I’ve missed something. Either the wording is a little too gray in one area (and gray is never going to go in your favor), or I missed something altogether. Take notes for yourself so you can tighten it up the next time you review a contract. You don’t want to make the same mistake twice. That’s absolutely fatal.
So do your homework as a CRNA. Yes, this isn’t anesthesia. Yes, it kind of stinks. But this is what keeps your income secure. It keeps you from a three-month gap in income, keeps you getting paid on time, keeps you from picking up extra shifts when the facility does you dirty or changes the anesthesia contract, and keeps your PTO protected, so the family reunion you scheduled nine months ago can’t be taken away.
Okay, okay…
I’ll stop rambling now and just say this. As much as you may not want to do anything outside of anesthesia, whether that’s learning about personal finance, investing, contract negotiation, or business, I’ve only been a CRNA for a handful of years, and a few contract negotiation points have earned me hundreds of thousands of dollars more.
On my first contract, negotiating just a few points was worth $110,000 over three years. Not too bad for a new grad. That has only grown as a locum. I can still say no, so I can negotiate very aggressively, and it works really well for me. Yes, there are setbacks, but at the end of the day it works really well for building wealth, and that’s the name of the game at The Financial Cocktail.
Thanks again for listening. Subscribe wherever you get your podcasts, and find the blog at thefinancialcocktail.com. Next week, we’re looking at a 1099 locum case study. It started as a blog post, but you’ll get a little more insight next time. Stick around, subscribe, and catch that one. Thanks, everyone, for listening.
This content is for educational purposes only and is not legal, tax, or financial advice. Contract terms, non-compete enforceability, and malpractice requirements vary by state and employer. Consult a qualified attorney or advisor about your specific situation.
