While using incentives to encourage healthy behaviors is new to Medicaid, it is an approach that has been examined in a number of small, controlled settings. Prior studies have found that efforts to promote one-time health behaviors with financial rewards have generally been successful. A 2007 review article found that 15 out of 17 studies (88%) offering cash or coupon rewards increased rates of one time health behaviors, like TB skin testing for drug users and HIV/STD prevention. The extent of improvement differed across studies, but was generally quite substantial. In one study, 90% of drug users returned for tuberculosis skin tests when given a $10 incentive, compared with 33% of those receiving no financial incentive. This literature has focused on vulnerable, low income populations, so the findings are likely relevant for the Medicaid population. However, these prior studies have sought to promote different one time wellness behaviors than those targeted by the current Medicaid initiatives.
Financial incentives have also been found to be effective in changing fundamental lifestyle
behaviors, such as smoking cessation and weight loss, however, less consistently so. Kane and
colleagues review of the literature found financial incentives were effective in 5 out of 9 studies (63%). Volpp and colleagues’ recent study was typical in terms of the extent of the incentives’ effect: 16% of those randomized to receive a financial incentive quit smoking after two and a half months, compared with 5% of those not receiving an incentive. This study, as well as most other effective programs, provided rewards after ascertaining behavior change occurred (e.g. using blood tests to test for smoking). This differs from the approach used by the current Medicaid efforts, which reward participation in behavior change programs. Studies that have rewarded program participation have found higher attendance levels but little change in behavior. This may be due to the fact that participation was rewarded or it may be due to the small samples studied.