Cash incentives make an impact on behavior

Take two of our most common obsessions getting rich and getting thin add a healthy dose of competition, and you get “The Biggest Loser,” the NBC reality show that pays $250,000 to the contestant with the biggest percentage weight loss in a season. Some winners have dropped close to half their body weight.

Paying people to lose weight: You wonder why someone didn't think of it sooner.

Someone did, though not with such outsized rewards. Two years before “Loser” debuted, Joseph Chemplavil, a doctor in Hampton, Va., began giving his patients cash prizes for weight loss. The grand prize each year is quite dazzling: an all-expense-paid trip to Las Vegas.

But everyone who plays can win a little something, as Chemplavil pays patients a dollar for every pound they lose.

There's a catch, though. Chemplavil keeps a clear glass cookie jar in his reception area, and if someone who has won cash subsequently gains weight, that patient has to put money in the jar. The penalty is the same as the prize, a dollar a pound.

Cash in hand proved a better incentive for losing weight than telling people it's good for them.

“Dollar memory” is what Chemplavil calls it. “It is like Pavlov's reflex.”

Chemplavil is not alone in recognizing that many of us need a little “incentivizing,” what insurance companies and big employers call their attempts to motivate people to adopt better health practices.

GE, for example, last year began offering employees money to quit smoking, while IBM employees who participate in wellness programs can get cash rebates. Safeway offers the incentive of lower health insurance premiums to workers who hit certain targets on weight, blood pressure and cholesterol levels, as well as for not smoking. The rates of obesity and smoking among Safeway employees are well below the national average, the company says.

Studies have begun offering some evidence that incentives can change behavior. A survey by the National Business Group on Health, in coordination with consulting firm Watson Wyatt, found employees were more likely to join lifestyle-management and wellness programs when offered a financial inducement.

A study in the New England Journal of Medicine last year showed that paying individuals to stop smoking “significantly increased the rates of smoking cessation.” A 2009 article in the journal Health Services Research showed that offering $100 to pregnant low-income women to participate in prenatal care lowered the rate of admissions to the neonatal intensive care unit.

Incentivizing gets at one of the most difficult challenges in health care: breaking bad habits. Unhealthful behaviors are notoriously hard to change, yet the consequences of such behaviors as smoking, poor diet and lack of exercise account for as much as 40 percent of all disease and premature death in the United States and a significant portion of the health care costs borne by insurance companies and large employers.

Heading off these conditions with incentives “can not only help you reduce future health care costs,” says the University of Pennsylvania's Kevin Volpp, “but also improve the health and productivity of your employees.”

Volpp, a physician who directs the Center for Health Incentives, points out that it costs a lot less to pay someone to stop smoking than to “treat their emphysema once they've smoked for 30 years.”

Volpp and his colleagues use the theories of behavioral economics the study of how people make choices about spending and earning, in ways that appear rational to them to explain why these programs work. “People really focus on the costs and benefits of what they are doing today,” he said, “as opposed to the delayed effects of their actions.”

That is, the benefits of quitting smoking may not be apparent right away, but the benefit of earning money is.

There's an irony here, because quitting smoking does have an immediate financial benefit: You save the money you would have spent on cigarettes. But somehow that is not enough, says Volpp. Putting $750 in your pocket all at once seems to be a stronger “carrot” than the potential $3,000 savings over a couple of years.

Though incentivizing seems to work for some people, does that means it is the right thing to do? Not to Daniel P. Sulmasy. “I worry that paying patients to change their behaviors is undignified and disrespectful,” says Sulmasy, a professor of medicine and ethics at the University of Chicago. “I think it is more respectful of patients to reason with them than to manipulate them.”

There are also questions about how long these purchased improvements will last. “These sorts of programs almost never work in the long term,” says Sulmasy, and a few studies support that belief.

In 2009, an article in the Journal of the American Medical Association noted that while an incentive program produced “significant weight loss” during an intervention that lasted 16 weeks, these results were not “fully sustained” thereafter.

A Cochrane review looking at various smoking-cessation programs concluded: “Smokers may quit while they take part in a competition or receive rewards for quitting, but do no better than unassisted quitters once the rewards stop.”

Despite the reservations, more companies are getting on the bandwagon. The way Volpp explains it, there's “so much excitement” about these approaches because the “status quo is clearly problematic” and “because other approaches haven't worked.”

Sulmasy is not entirely convinced. “We should prevent disease not because it saves money,” he says, “but because it simply is better for people to live well and to flourish rather than to be sick.”