Washington Post Examines Use Of Incentives For Weight Loss To Reduce Health Care Costs

Main Category: Obesity / Weight Loss / Fitness
Also Included In: Health Insurance / Medical Insurance
Article Date: 13 Nov 2007 - 7:00 PDT

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The Washington Post on Sunday examined how U.S. corporations are "starting to integrate cash incentives into wellness plans in hopes of reducing" health care costs related to obesity. According to the Post, "The idea behind weight-loss payments is to wage battle with the many incentives the world offers [people] to keep the weight on."

A recent study by RTI International economist Eric Finkelstein found that the more money people were paid to lose weight, the more weight they lost. For the study, people were paid either nothing, $7 or $14 per percentage point of body weight they lost. After three months, people who received no incentive lost an average of two pounds, while the $7 group lost about three pounds and the $14 group lost five pounds. In addition, the study found that people in the $14 group were five times more likely that those receiving no incentive to lose 5% of their body weight.

The continuing care retirement community Wesley Willows, which participates in such an incentive program, has spent $11,500 to implement an incentive program developed by the Boston-based company Tangerine Wellness, including rewards, and health care costs at the company have declined by more than $146,000, according to Cathie Holmgaard, Wesley's director of human resources.

However, Barry Nalebuff, an economist and a professor at Yale University, "thinks the weight loss will happen only if there is something of importance being risked." Several of Nalebuff's colleagues are in the final stages of launching a company called stickK.com that "will allow people to take out a contract on themselves, ... pick a price" and if "they don't lose a certain amount of weight, they lose the money, either to a charity, friends or family," the Post reports. According to Ian Ayers, one of the company's founders, "Thousands of studies have shown that people work harder to avoid losses than to gain a similar amount" (Rosenwald, Washington Post, 11/11).

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