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American Workers Being Paid To Slim Down

June 2, 2010

In the face of continued rising healthcare costs, many U.S. employers are betting they can entice workers to lose weight or adopt healthier lifestyles by offering financial incentives.

“There’s been an explosion of interest in this,” said Dr. Kevin Volpp, director of the University of Pennsylvania’s Center for Health Incentives, in an interview with the Associated Press (AP).

With the majority of its workforce overweight, hospital chain OhioHealth initiated a program last year that paid employees for walking. The company had workers wear pedometers, and paid them as much as $500 per year according to how far they walked.

Roughly half of the 9,000 employees at the chain’s five main hospitals enrolled, and more than $377,000 in rewards have been dispersed, AP reported.

But while anecdotal stories of the program’s success abound, experts say it is doubtful such campaigns can permanently alter the nation’s obesity problem.

“It’s probably a waste of time,” said Kelly Brownell, director of Yale University’s Rudd Center for Food Policy and Obesity, during an interview with AP.

Brownell offers a stark assessment, but one that appears to be supported by science.

Some 20 U.S. studies have attempted to measure the effect of financial incentives on weight loss.  However, most were small, and did not examine whether such measures were effective beyond a few months.  And none could reach a definitive conclusion about how much money is required to make a lasting impact.

The largest examination to date on the subject was an observational study conducted by Cornell University, which looked at seven employer programs.  The results were disappointing, with an average weight loss of slightly more than one pound.

But some of the smaller studies reported promising results with tobacco.  One study published last year in the New England Journal of Medicine, co-authored by Volpp, found that financial incentives of a few hundred dollars nearly tripled the rates of smoking cessation.

“Food is more difficult than tobacco,” said University of Texas epidemiology professor Steven Kelder.

One possible explanation for this is that while cigarettes can be addictive, people don’t need to smoke to survive.  On the other hand, people must eat, and fatty, calorie-laden snacks and drinks are ubiquitous, Kelder told the AP.

With more than two-thirds of American adults overweight, and one-third obese, experts have long warned of the role fatty foods play in conditions such diabetes and heart disease.

The problem has a significant financial impact as well.  

Research group Conference Board, which focuses on management and the marketplace, estimated that obese workers cost U.S. private employers $45 billion per year in healthcare costs and lost productivity.

First lady Michelle Obama is leading an initiative to foster several approaches to help Americans slim down.  In response, many food companies have publicly endorsed the campaign, and have promised to offer lower calorie foods, reduce portion sizes and alter recipes.

Some experts are captivated by the idea of using economics to entice people to adopt healthier lifestyles, with Brownell and others pushing for new taxes on soda, similar to those imposed on cigarettes.

But companies tend to be more interested in positive incentives, rather than disincentives like taxes.  

These wellness perks vary in form and size, with some firms rewarding workers for merely having a health exam or enrolling in a class while others require quantifiable weight loss or exercise achievement.

Some firms offer money, reduced health insurance premiums or even vacation trips as rewards for weight loss, while others may simply refund the cost of courses such as those offered by Weight Watchers.

The value of these rewards can be up to thousands of dollars, and are often driven by budget constraints or hunches “” something companies are quite candid about.

OhioHealth set the maximum reward for its step-counting program at $500.

“It just sounded right to us. We thought that would be a big enough number to help people think twice,” Lisa Meddock, OhioHealth’s benefits manager, told the AP.

IBM rewards its workers for completing 12-week Web-based health programs, paying $150 per program completed.  Dr. Joyce Young, the company’s wellbeing director, said there was just a feeling that it was the right amount to get workers involved.

Firms “are making best their guesses about what might work and giving it a shot,” Robert Jeffery, a University of Minnesota professor who has been studying financial weight loss incentives for decades, told AP.
 
Experts say the incentives offered by companies may need to be larger to be effective, such as higher cash rewards or bigger penalties in premium costs. 

According to psychologists, people are more motivated by the risk of losing their own money than by a chance to win somebody else’s.

Applying that theory to weight loss, some studies have established refundable bond systems in which volunteers sign a contract agreeing to lose a certain amount of weight by a certain date.  If they don’t succeed, they lose their deposited money.

One of the companies in the Cornell study offered a refundable bond option to its workers, resulting in an average weight loss of nearly 4 pounds per employee ““ nearly twice as much as the average weight loss at companies paying quarterly rewards.

A study conducted in 2008 by researchers at the University of Pennsylvania found that people who put their own money on the line lost on average about one pound more after 16 weeks than those who received cash from others.

There are a few companies that market refundable bond contracts to those trying to lose weight.   One firm, StickK.com, even goes as far as sending the forfeited money from those who fail to an organization the customer despises.

“The most popular is the George W. Bush Presidential Library,” company spokesman Sam Espinosa told the AP.

“Last year, we sent $6,000 to them.”

However, since these programs are voluntary, critics say they may work only for the most motivated few. 

And some employers worry such incentives may appear coercive, to the point of becoming grounds for lawsuits.

“They’re very nervous about doing anything that might seem invasive,” Helen Darling, president of the National Business Group on Health, told the AP.

Many believe the smartest approach is to use financial incentives as part of a broader effort to foster a “healthy lifestyle” culture. 

IBM’s worksite wellness program is often considered a model, with some fifty percent of the company’s workforce earning at least $150 a year for participating. 

But marketing manager Kevin Acocella, 35, failed twice after enrolling in IBM’s web-based fitness program two years ago.

The money got his attention, the problem was the culture he was in, said the 5-feet-9, 185-pound Acocella. 

“In New York City it was, ‘What restaurant can we go to, or what bar can we go to?’” he told the AP.

Acocella moved to IBM’s office in San Jose, California early this year.

“Here it’s, ‘What activity can you do, and what can you go see, and how can we figure out a way to not take a car there,’” he said.

Acocella had lost 9 pounds in the three months he’s been in San Jose, and has recently re-enrolled in IBM’s reward program. 

This time, however, the program is secondary to his healthy lifestyle.

“The real issue was getting myself in a program I could actually do and could keep up with. I don’t think those things swing on a dollar,” he said.




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