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A Simulation Modeling Framework to Optimize Programs Using Financial Incentives to Motivate Health Behavior Change.

Sanjay Basu1, Michaela Kiernan1

  • 1Prevention Research Center, Stanford University, Stanford, CA (SB, MK).

Medical Decision Making : an International Journal of the Society for Medical Decision Making
|May 16, 2015
PubMed
Summary

Optimizing financial incentives for employee health behavior change requires higher levels than currently offered. A new model shows that excessive enrollment by already-healthy individuals can negate program benefits, emphasizing the need for careful program design.

Keywords:
behavior changefinancial incentivesmathematical modelphysical activityworkplace wellness programs

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Area of Science:

  • Health Economics
  • Behavioral Science
  • Occupational Health

Background:

  • Financial incentives for employee health behavior change are increasingly popular but controversial due to study limitations.
  • Key questions remain regarding optimal incentive levels and target employee groups for positive return on investment.

Purpose of the Study:

  • To develop a novel modeling framework to optimize marginal return on investment for employee behavior change incentive programs.
  • To integrate individual response variability and demographic data into economic return calculations.

Main Methods:

  • Constructed a modeling framework integrating "demand curves" for incentive response with employee data.
  • Estimated the maximum tolerable self-selection of already-healthy employees for positive return on investment.
  • Applied the framework to data from 3000 worksite physical activity programs.

Main Results:

  • Optimal incentive levels for physical activity programs ($367/employee/year) exceed current averages ($143/employee/year).
  • High self-selection (over 17% from the top 10% most active) can result in negative economic returns.

Conclusions:

  • A generalizable framework was developed to estimate optimal incentive levels by accounting for individual differences.
  • The framework aids in maximizing return on investment for employee wellness programs.