Financial Rewards/Penalties Undermine Wellness Program Success
PR Log - May 15, 2012 - Midland, Mich. - Using financial carrots and sticks to motivate improved health behaviors has gained momentum the last few years. Some 80% of companies expect to have a financial incentive and/or disincentive in place in 2012. It’s a short-sighted policy fraught with peril, suggests a new white paper by Health Enhancement Systems.
In How Financial Incentives/Disincentives Undermine Wellness, program managers learn that giving people money (or withholding it) to gain compliance doesn’t work long term. And it can alienate workers — rather than motivate — in the process. Using more than 2 dozen studies, books, and other sources on the psychology behind behavior change, the white paper describes what works and what doesn’t — and how money actually decreases intrinsic motivation for health improvement.
The white paper traces the usual evolution of financial incentive models in corporate wellness programs, starting with cash rewards, then premium discounts, then withholding account contributions, and finally financial penalties for noncompliance or failure to achieve outcomes. As each tweak in the system falls short of producing desired results, decision makers are forced to turn the screws a little tighter or up the ante to reach last year’s numbers. Faced with unsustainable incentive costs and/or rising employee backlash by years 3 or 4, management determines that wellness may not work… putting the entire program at risk. And, in fact, if workers aren’t seeing good health as its own reward, the positive behaviors will stop when the carrots or sticks stop.
“The most pernicious aspects of a financial reward/penalty model aren’t that it doesn’t work long term and can create resentment, but that it robs people of belief in their own ability to think and do what’s best for themselves,” notes Dean Witherspoon, President and founder of Health Enhancement Systems. “It reduces them to spoiled children groveling for another dollar in their allowance because they had a birthday. And it sends a message that the organization thinks so little of their capability to act in their own best interest that it needs to bribe or browbeat them into compliance.”
The paper goes on to outline what does work to engage and inspire workers toward healthier choices — ultimately creating an environment where intrinsic motivation can flourish and employers can achieve a culture of health. It outlines 20 different ways wellness managers can get on the path to a sustainable program that reinforces commitment by making health a shared responsibility.
“Giving people money to coerce them to do something we want them to want to do for themselves is at best ineffective and at worst degrading,” explains Witherspoon. “To enjoy the competitive advantages a healthy workforce offers, organizations need to invest in resources that allow workers to make the healthy choice on their own — and stop thinking they can impose health improvement with rewards or punishment.”
Health Enhancement Systems creates employee wellness programs for organizations in North America and throughout the world. More than 20 effective, engaging HES health promotion campaigns have been adopted by over a thousand organizations — serving hundreds of thousands of participants successfully.