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To Encourage Exercise, Losing A Financial Reward Is More Effective Than Gaining One

Last updated Feb. 21, 2016

Approved by: Krish Tangella MD, MBA, FCAP

"Most workplace wellness programs typically offer the reward after the goal is achieved."

Financial incentives aimed at increasing physical activity were most effective when the rewards were put at risk of being lost, according to new research from the Perelman School of Medicine at the University of Pennsylvania. The study, which tested the effectiveness of three methods of financial incentives to increase physical activity among overweight and obese adults, shows that depending on how they are framed, incentives of equal amounts can have significantly different effects on outcomes. Results are published today in the Annals of Internal Medicine.

"Although most people know that exercise is good for their health, more than 50 percent of adults in the United States don't get enough of it," said lead author Mitesh S. Patel, MD, MBA, MS, an assistant professor of Medicine and Health Care Management in Penn's Perelman School of Medicine and The Wharton School, and a staff physician at the Crescenz VA Medical Center. "Workplace wellness programs aimed at increasing physical activity and other healthy behaviors have also become increasingly popular, but there's a lack of understanding about how to design incentives within these programs. Our findings suggest that these programs could result in better outcomes if they designed financial incentives based on principles from behavioral economics such as loss aversion."

In the study, 281 participants were given the goal of reaching 7,000 steps per day for the 26-week study period. For the first 13 weeks, participants were randomly assigned to one of four groups: the control group received no financial incentive; the gain incentive group received $1.40 for every day that the goal was achieved (equal to $42 per month); the lottery incentive group offered entry into a daily lottery with a possible prize that averaged to $1.40 each day that the goal was achieved; and, the loss incentive group which gave participants $42 at the start of each month and took $1.40 away for each day the goal was not achieved. In the second half of the study, participants continued to receive feedback on their performance, but were not offered an incentive.

By providing incentives of equal amounts, the team sought to determine which program design was most effective at motivating participants to increase physical activity and achieve the goal of 7,000 steps per day - roughly 40 percent higher than the average daily step count among U.S. adults (5,000). Progress was tracked using a mobile app which ran in the background on participants' smartphones.

Results from the first 13 weeks of the study show that offering a $1.40 reward each time the goal is achieved (the gain incentive group), or when daily lotteries were offered, were no more effective than not offering a reward at all (the control group). In those groups, participants achieved the daily goal approximately 30 to 35 percent of the time. However, participants who risked losing the reward they'd already been given (the loss incentive group) achieved the goal 45 percent of the time, amounting to an almost 50 percent increase over the control group. According to the authors, these findings suggest that the way in which a financial incentive is framed is important in determining its success.

"Most workplace wellness programs typically offer the reward after the goal is achieved," said senior author Kevin G. Volpp, MD, PhD, a professor of Medicine and Health Care Management and director of the Penn Center for Health Incentives and Behavioral Economics. "Our findings demonstrate that the potential of losing a reward is a more powerful motivator and adds important knowledge to our understanding of how to use financial incentives to encourage employee participation in wellness programs."

The authors noted that 96 percent of participants were still actively enrolled in the study even three months after stopping incentives, which may have important implications for the role that smartphones could play in deploying these programs at broader scale.

"Our findings reveal how wearable devices and apps can play a role in motivating people to increase physical activity, but what really makes the difference is how you design the incentive strategy around those apps," said David A. Asch, MD, MBA, a professor of Medicine and Health Care Management and director of the Penn Center for Health Care Innovation.

The authors say future studies might compare the effectiveness of incentives when combined with other motivators such as team-based designs that rely on peer support and accountability, or designs aimed at determining a more effective reward amount.

The above post is reprinted from materials provided by Penn MedicineNote: Materials may be edited for content and length.

Disclaimer: DoveMed is not responsible for the adapted accuracy of news releases posted to DoveMed by contributing universities and institutions.

Primary Resource:

Patel, M. S., Asch, D. A., Rosin, R., Small, D. S., Bellamy, S. L., Heuer, J., ... & Wesby, L. Framing Financial Incentives to Increase Physical Activity Among Overweight and Obese Adults: A Randomized, Controlled Trial.Annals of Internal Medicine.

Reviewed and Approved by a member of the DoveMed Editorial Board
First uploaded: Feb. 21, 2016
Last updated: Feb. 21, 2016