Results shed light on potential challenges of health insurance premium adjustments in wellness programs.
Employers around the nation are increasingly searching for ways to help their employees make healthy lifestyle choices including encouraging obese employees to lose weight, often by offering financial incentives in the form of reduced health insurance premiums to help encourage success. But these programs are likely to fail, according to new research from the Perelman School of Medicine at the University of Pennsylvania published in the January issue of Health Affairs.
The team’s findings revealed that tree different types of incentive programs using either health insurance premium adjustments or lottery-based financial incentives were in effective for promoting weight loss in a randomized trial using weight scales in the workplace. The researchers say the apparent failure of the incentives to promote weight loss suggests that employers encouraging weight reduction and other healthy lifestyle choices through workplace wellness programs should test incentive designs different from the typical premium-based financial incentives.
“More than 80 percent of large employers use financial incentives for health promotion. Many use health insurance premium adjustments, but these incentives are often delayed and, even when they aren’t, they are typically hidden in paychecks along with other deductions and payments. That makes them less noticeable,” said Mitesh Patel, MD, an assistant professor of Medicine and Health Care Management at in Penn’s Perelman School of Medicine and The Wharton School, and a staff physician at the Crescenz VA Medical Center in Philadelphia. “Our findings suggest that employers should consider testing designs alternative to the $550 premium-based incentives used in this study.”
In the study, 197 obese participants were enrolled in a workplace wellness program and given a weight loss goal equivalent to five percent of their weight at enrollment. Participants were randomly assigned to a control arm with no financial incentive for achieving the goal, or one of three intervention arms, each offering an incentive valued at $550. Two of these arms used health insurance premium adjustments, either delayed until the beginning the following year, or taking effect in the first pay period after achieving the goal. Participants in the third intervention group were entered into a daily lottery incentive. Twelve months after enrollment results of the study showed no significant changes in average weight loss for participants in any of the four groups.
“Though participants in our study didn’t experience significant weight loss, that doesn’t mean that all incentive programs are ineffective, only that we need to move to more creative designs that might better leverage predictable barriers to behavior change,” said David Asch, MD, MBA, a professor of Medicine and Health Care Management and director of the Penn Center for Health Care Innovation.
The Affordable Care Act contains a provision allowing employers to use up to 30 percent of health insurance premiums as penalties or rewards, which would total roughly $1,800 for the average employee. But, the authors emphasize that the incentive amount alone may not be enough to encourage the adoption of healthy behaviors. Rather, effectiveness of incentive programs typically depends in part on how the incentive is deployed and in what context.
“There is often a presumption that the size of the reward is all that matters. In reality, incentive systems vary in effectiveness according to how well they are designed,” said Kevin Volpp, MD, PhD, a professor of Medicine and Health Care Management and director of the Penn Center for Health Incentives and Behavioral Economics. “In this case, premium adjustments had little impact on weight and the lottery incentives we used were constrained by having to do weigh-ins in workplace settings. That made sustained engagement and behavior change more challenging.”