The Effect of Cost Sharing on an Employee Weight Loss Program: A Randomized Trial

Leslie K. John; Andrea  Troxel; William  Yancy; Joelle Y. Friedman; Jingsan  Zhu; Lin  Yang; Robert  Galvin; Karen  Miller-Kovach; Scott  Halpern; George   Loewenstein; Kevin  Volpp

Article | American Journal of Health Promotion | January 2018

The Effect of Cost Sharing on an Employee Weight Loss Program: A Randomized Trial

by Leslie K. John, Andrea Troxel, William Yancy, Joelle Y. Friedman, Jingsan Zhu, Lin Yang, Robert Galvin, Karen Miller-Kovach, Scott Halpern, George Loewenstein and Kevin Volpp

Abstract

Purpose: We tested the effects of employer subsidies on employee enrollment, attendance, and weight loss in a nationally-available weight management program. Design: A randomized trial tested the impact of employer subsidy: 100%; 80% 50% and a hybrid 50% subsidy that could become a 100% subsidy by attaining attendance targets. Trial registration: NCT01756066. Setting and Subjects: 23,023 employees of two U.S. companies. Measures: The primary outcome was the percentage of employees who enrolled in the weight management program. We also tested whether the subsidies were associated with differential attendance and weight loss over 12 months, as might be predicted by the expectation that they attract employees with differing degrees of motivation. Analysis and Results: Enrollment differed significantly by subsidy level (p<.0001). The 100% subsidy produced the highest enrollment (7.7%), significantly higher than each of the lower subsidies (vs. 80% subsidy: 6.2%, p=.002; vs. 50% subsidy: 3.9%, p<.0001; vs. hybrid: 3.7%, p<.0001). Enrollment in the 80% subsidy group was significantly higher than both lower subsidy groups (vs. 50% subsidy: 3.9%, p<.0001; vs. hybrid: 3.7%, p<.0001). Among enrollees, there were no differences among the four groups in attendance or weight loss. Conclusion: This pragmatic trial, conducted in a real-world workplace setting, suggests that higher rates of employer subsidization help individuals to enroll in weight loss programs, without a decrement in program effectiveness. Future research could explore the cost effectiveness of such subsidies or alternative designs.

Keywords: Affordable Care Act (ACA); subsidies; weight loss; obesity; incentives; Behavioral economics; Motivation and Incentives; Behavior; Health Disorders; Health Care and Treatment; Compensation and Benefits; United States;

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John, Leslie K., Andrea Troxel, William Yancy, Joelle Y. Friedman, Jingsan Zhu, Lin Yang, Robert Galvin, Karen Miller-Kovach, Scott Halpern, George Loewenstein, and Kevin Volpp. "The Effect of Cost Sharing on an Employee Weight Loss Program: A Randomized Trial." American Journal of Health Promotion 32, no. 1 (January 2018): 170–176.

The case describes a program that CVS Health recently implemented to improve medication adherence, an important problem from a societal, public policy, and firm perspective. A test of the program, costing hundreds of thousands of dollars to implement, increased the proportion of adherent customers by 1.4 percentage points. Students are asked to quantify the system-wide economic benefit of this improvement and draw upon insights from behavioral science to examine approaches for boosting medication adherence.

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By the time Dan Doctoroff, CEO of Sidewalk Labs, began hosting a Reddit “Ask Me Anything” session in January 2018, he had only nine months remaining to convince the people of Toronto, their government representatives, and presumably his parent company Alphabet, Inc., that Sidewalk Labs’ plan to construct “the first truly 21st-century city” on the Canadian city’s waterfront was a sound one. Along with much excitement and optimism, strains of concern had emerged since Doctoroff and partners first announced their intentions for a city “built from the internet up” in Toronto’s Quayside district. As Doctoroff prepared for yet another milestone in a year of planning and community engagement, it was almost certain that of the many questions headed his way, digital privacy would be among them.

In their commentary, Wilson & Stolarz-Fantino argue that specific design features of our research mean that it cannot have policy implications and that researchers “need to consider profit maximization in menu design or studies are likely to suggest ill-informed implementations.” In this reply, we respond to the specific critiques of our work with empirical data and conceptual arguments. We agree with Wilson and Stolarz-Fantino that researchers seeking to understand a policy’s influence on consumers should test predictions about which strategies firms will likely use when implementing a policy. Research, however, that demonstrates the effectiveness (or lack thereof) of an intervention even without perfectly predicting a firm’s response still has enormous value for setting policy.

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The Effect of Cost Sharing on an Employee Weight Loss Program: A Randomized Trial

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