Incentives Relating to Health Behavior

By March 9, 2017Commentary

So, if you think you know what is could for people to do in regard to their health and health care, maybe you can give them incentives, positive or negative to do those things.  But what are the best incentives and what is the most effective way to structure them?  An National Bureau of Economic Research paper continues investigations on that topic by looking at a specific incentive at one large employer.  (NBER Paper)   The incentive related to use of a company gym.  Some people may already be using the gym, so one question may be whether an incentive will keep them going.  And for those who weren’t using the gym, what kind of incentive might get them started.  The researchers took a total incentive of $160 and divided into two approaches.  In one, employees were offered up to $10 a visit for two visits a week throughout the eight-week study period.  In the other, employees got $25 a visit for visits in the first two weeks, and $5 a visit for the rest of the study period.

Employees were already in the program responded to both types of incentives by increasing their visit rates, although the constant incentive had a somewhat stronger effect.  For workers who weren’t gym members, both types of incentive increased usage about equally.  But neither incentive appeared to have strong effects on visit rates following the end of the incentive period.  The authors conclude that in structuring incentives, it may be more important to focus on sustaining behavior change and encouraging habit formation over a long period of time than to use a sharp incentive to create initial behavior change.  Of course, the use of both may be the best method.  And this study dealt with positive incentives; negative ones may also be employed and some combination of positive and negative may encourage that initial behavior change that is often so hard.

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