Washington Post Examines Use Of Incentives For Weight Loss

Armen Hareyan's picture

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


A recent study by RTI Internationaleconomist Eric Finkelstein found that the more money people were paidto lose weight, the more weight they lost. For the study, people werepaid either nothing, $7 or $14 per percentage point of body weight theylost. After three months, people who received no incentive lost anaverage of two pounds, while the $7 group lost about three pounds andthe $14 group lost five pounds. In addition, the study found thatpeople in the $14 group were five times more likely that thosereceiving no incentive to lose 5% of their body weight.

Thecontinuing care retirement community Wesley Willows, which participatesin such an incentive program, has spent $11,500 to implement anincentive program developed by the Boston-based company Tangerine Wellness,including rewards, and health care costs at the company have declinedby more than $146,000, according to Cathie Holmgaard, Wesley's directorof human resources.

However, Barry Nalebuff, an economist and a professor at Yale University,"thinks the weight loss will happen only if there is something ofimportance being risked." Several of Nalebuff's colleagues are in thefinal stages of launching a company called stickK.com that "will allowpeople 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 Postreports. According to Ian Ayers, one of the company's founders,"Thousands of studies have shown that people work harder to avoidlosses than to gain a similar amount" (Rosenwald, Washington Post, 11/11).

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