Michael Rosenwald discusses the economics of firms providing workers incentives to lose weight.
Tangerine, based in Boston, designs weight-loss programs that employ economic incentives. The company is modeled on recent economic research showing that paying people to lose weight causes their pounds to fall off faster. Eric Finkelstein, an economist with RTI International who has spoken with Tangerine executives, recently conducted a study in which people were paid either $7 or $14 per percentage point of body weight they lost.
After three months, people with no incentives lost about two pounds. The $7 group lost about three pounds. The $14 group: five pounds. Members of the more expensive group were also five times more likely than members of the no-money group to lose 5 percent of their body weight. One person netted $140. Were they more excited about losing weight or about the money? "I think they were most excited by the $140," Finkelstein said.
An average of 140 employees at Wesley Willows participate in the program, which started eight months ago. They get $3 per percentage point of weight lost. Together, they have lost 806 pounds. Holmgaard said the company has spent $11,500 on the Tangerine program, including rewards. The company's health-care costs have tumbled more than $146,000. "Certainly paying them gets their attention," Holmgaard said.
Sounds great. This is important news.
However Rosenwald has some trouble deciding if he is interested in health or the new morality in which the wages of sin are fat. He writes
My insurance company requires no co-payments for generic drugs, so I can theoretically mask the problem for free. And it just became cheaper for millions of Americans to get low-cost generics through Wal-Mart, which is charging $4 for a 30-day supply of drugs that treat common ailments such as high blood pressure.
"If you reduce the cost of maintaining unhealthy behaviors or lifestyles, what incentive do you have to change?" said Ross DeVol, a Milken Institute economist who studies health care issues.
so taking pills is masking the problem ? Rosenwald says this, because taking pills is easy and therefore not virtuous. It is also true that obesity causes problems which can not be treated with pills, but he's decided that taking a pill a day is not a healthy behavior because ... ? Well for no reason. His use of "mask" for a approach which resolves a very serious but invisible problem and leaves him as visibly fat as ever is bizarre.
He goes on
I chose the drugs and am thusly always on the prowl for beef. So, apparently, are millions of other Americans. Seventy-five percent of the nation's $1.4 trillion in annual medical costs can be blamed on chronic diseases, many of which are lifestyle induced, according to the Centers for Disease Control and Prevention. The effect of blood pressure and cholesterol medicine is startling: A study in the Journal of the American Medical Association showed that earlier this decade, obese people had a 21 percent lower prevalence of high cholesterol and an 18 percent lower prevalence of high blood pressure than obese people did in the early 1960s. We seem to be healthier fat people, but we're not cheap for the health-care system -- or our employers.
This is getting weird. The pills don't cause the cronic diseases. They prevent them. The major cost to the USA is not paying for statins and high blood pressure medications, but paying for, among other things, the consequences of high blood pressure and cholesterol. Furthermore the social cost of the pills is very low. Most of the cost is a transfer to pharmaceutical companies which can be cut by congress anytime it wants to (that is when hell freezes over).
I think that an incentive program which paid people to lower their blood cholesterol and blood pressure and control their blood glucose would be even more profitable than one that paid them to lower their weight. It would be paying them to take a pill a day. People don't need much money to do that (writes the guy who hasn't taken his statin for 2 weeks). The best program would pay for for improvements in weight, blood pressure and blood cholesterol.
The idea that pills for blood pressure, blood glucose and blood cholesterol are part of the problem not part of the solution is based on puritanism not biology or economics.