Enticing employees to get healthy using cash rewards can work if employers add a little peer pressure to the equation, new research shows.
A study led by the Ann Arbor VA Healthcare System and the University of Michigan Health System discovered that employees who are offered money for weight loss are more successful when awards are based on a group's performance — rather than just their own.
Specifically, the research found that group-based financial incentives led to nearly three times more weight loss than cash awards based on an individual's weight-loss success alone.
"We anticipate more employers to offer these awards in an effort to help control health care costs while also improving the health of employees," said Jeffrey Kullgren, the study's lead author and health services researcher in the VA Center for Clinical Management Research and the division of general medicine in the UM Medical School. "We found that these incentives were substantially more powerful when delivered in groups, which has important implications for both policymakers and the employers who are considering offering them."
As part of the study, researchers examined two types of incentive strategies among obese employees at the Children’s Hospital of Philadelphia. In the first group, individuals were offered $100 each month they met weight-loss goals. In the second group, individuals were placed into groups of five people in which $500 was split among those who met monthly weight-loss goals. The study also upped the competition by allowing some individuals to earn more than $100 if other members didn't meet the goals.
After six months, the group approach overwhelmingly beat out the single-based approach when it came to enticing people to shed pounds.
"Despite the health and economic consequences of obesity, the problem isn’t getting any better, and there is great interest in identifying new approaches to combating this major health issue in our country," Kullgren said. "Approaches such as ‘The Biggest Loser' have received popular attention as ways to harness group dynamics to encourage weight loss, but the winner-take-all nature could be discouraging for everyone but the most successful person."
The research notes that starting next year, the Affordable Care Act expands employers' ability to reward employees who meet health status goals by participating in wellness programs. Rewards may include premium discounts or rebates, lower cost-sharing requirements, the absence of a surcharge or extra benefits related to employer-sponsored health coverage.
Kullgren said more data is needed to compare how different group-based approaches stack up against each other.
The study, published in the Annals of Internal Medicine journal, was funded by the National Institute on Aging ( of the National Institutes of Health), the Department of Veterans Affairs and the Robert Wood Johnson Foundation Clinical Scholars program.