Use of Incentives for Healthy Behavior Expands in Medicaid

In Iowa, a patient saved $10 a month on his premium for completing a survey on his health risks. In New Mexico, a patient who got her eyes checked, visited the dentist, and kept track of her walking with a pedometer received a $100 gift card to use for health products like vitamins and toothpaste.

Thousands of miles apart, these 2 patients have something in common: they are both Medicaid recipients, and they are among the growing ranks receiving incentives to quit bad habits like smoking and adopt better ones, like exercising.

A report in Kaiser Health News (KHN) outlines how state Medicaid programs are stealing a page from workplace wellness plans, which for years have dangled carrots in front of employees to get them to stop smoking or lose weight. The migration of incentives to Medicaid makes sense from both a healthcare and a financial perspective, since Medicaid patients are more likely to have poor health habits that drive up costs.

A reason behind the trend is the Affordable Care Act (ACA), which provided $85 million to try out different incentive programs in 10 states. The biggest challenge thus far is enrolling people—it’s hard to get the word out, and the poor are less likely to understand how incentives work. Even if they do, not having a ride to the doctor or an educational class can keep people away.

Different programs will be studied so researchers can learn what works best. University of Minnesota’s Jean Abraham, an associate professor of health policy and management, told KHN that very little is known about what motivates people to take a short-term step, like getting a colonoscopy, compared with changing long-term behaviors.

What is known is that states across the nation are looking for ways to rein in Medicaid spending, with many trying managed care to better coordinate and control costs. Such solutions may be met with resistance, both from beneficiaries and political leaders. Incentives, by contrast, seem to appeal to the range of opinion on healthcare for the poor and the ACA in particular.