Cash Drives Worker Weight Loss Credit: Weight loss image via Shutterstock

Employers trying to get their employees to slim down a bit should consider enticing them with a little extra money in their paychecks, new research finds.

A study by researchers from the University of Texas at Arlington and Cornell University discovered that financial incentives are a very effective tool in encouraging employees to lose weight through employer-sponsored wellness programs.

As part of the study, researchers analyzed four weight-loss options that an undisclosed company provided in its wellness package to employees. In addition, they also studied weight loss outcomes of each of the company's 2,635 employees. The options examined were:

  • Option one was a control group where participants signed up and participated in weigh-ins, but there was no financial component to the intervention.
  • Option two allowed employees to join a weight loss program for free. They were paid financial incentives once per quarter for losing weight.
  • Option three required employees to pay to join the weight loss program. The employer then paid employees a refundable bond or rebate at the end of the year based on how much weight they lost.
  • Option four also required employees to pay to join the weight loss program. The employer then paid employees a refundable bond or rebate every quarter, instead of at the end of the year.

Researchers found that employees who received some sort of financial incentive, either by being paid directly or through a refundable bond program, experienced more weight loss than in the control group who weren't given any extra cash for their weight loss efforts.

"We discovered that the best results for weight loss were through a more regular payment of refundable participation fees," said Joshua Price, a UT Arlington assistant professor and co-author of the study. "The payments seem to work as a reinforcement for people to continue to lose weight."

Price said they found that the deposit contracts were more effective at inducing weight loss, and it made it less likely for the companies to lose money on the initiative. He said when the companies refunded employees some of what they paid into the program, the mission had been accomplished: Employees had improved their health.

In addition, if the employees didn’t lose weight, the company kept the money employees had paid into the program.

Price noted that financial incentives that were paid out just once a year, like in option three, had some unintended consequences.

"Anecdotally, the employer observed unhealthy weight loss methods being implemented leading up to the last weigh-in," he said.

In total, the study found that 94 percent of employers with more than 200 employers in the United States offer wellness programs to their staff.

The study, co-authored by Cornell University professor John Cawley, was recently was accepted for publication in The Journal of Health Economics.

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