Role of Incentives and Rewards in Remaining Healthy

Most people do the things they are rewarded for and dont do the things that cause them problems. Thats true in health as well as most other aspects of life. Incentives play an important role in promoting good health, and in encouraging specific behaviors, decisions, or actions that will help people live healthy lives. There can also be disincentives in the health care system, which act to discourage healthy behaviors. The types of incentives, or disincentives, can vary widely, and usually depend on whom they target.

Cost-Sharing
Cost sharing, or requiring a person to pay a portion of his health care services, is commonly used to discourage patients from seeking unnecessary medical care. Cost sharing often takes the form of a co-payment or co-pay, which is usually only a small fraction of the actual cost of the medical service. The remainder of the cost is covered by the persons insurance company or by the government payer. Some research suggests that, at times, co-pays may serve to discourage some people from using certain types of care. A RAND study found that people with chronic diseases who were receiving routine care cut their use of needed prescription medicines when they had co-pays. On the other hand, financial incentives such as no co-pays for high-risk patients may help to improve how well patients follow their prescribed treatment.1

Taking Action
At Johnson & Johnson, we advocate for policies that appropriately use incentives to improve care, and we work to alleviate disincentives for patients who cannot afford to pay for their prescription medications. Weve also developed our own health incentives for employees. This includes a comprehensive Healthy People program based on the U.S. governments Healthy People 2010 initiative. Through this program, we provide incentives to our employees and their families that encourage them to adopt preventative lifestyles and make healthy choices.
1 Goldman, Dana, et. al. Pharmacy Benefits and the Use of Drugs by the Chronically Ill. Journal of the American Medical Association, Vol 291, No. 19. May 19, 2004. Available at http://jama.ama-assn.org/cgi/content/abstract/291/19/2344

By educating employees about the dangers of risky behaviors like smoking, and rewarding them for healthy behaviors like exercise, we are reducing the incidence of diseases among the Johnson & Johnson family of companies community. In the 25 years that weve been running these programs, weve seen cost reductions as well as marked improvements in employee health. From the late 1990s to 2006 in the U.S., smoking declined from 12 percent of our workforce to four percent, high blood pressure dropped from 14 percent to six percent, and high cholesterol went from 19 percent to six percent. In each case, the improvements exceeded the U.S. Healthy People 2010 guidelines. One study confirms that we have improved health and our employees have saved an average of $225 per year because of reduced need for doctors visits.2 As part of our commitment to help employees of Johnson & Johnson companies achieve optimal health, they are invited to participate in the Health Profile. The Health Profile provides a snapshot of an employees current health status and a road map for achieving a healthier lifestyle. Employees enrolled in the Choices benefits program who complete the Health Profile and participate in Health Profile counseling and/or CareConnect the disease management program designed for individuals with certain chronic conditions such as diabetes, asthma, heart disease or hypertension or complex conditions such as cancer, spinal injuries, highrisk pregnancies, organ transplants and multiple sclerosis are eligible for an annual $500 reduction in medical insurance premiums, or if applicable, Additional Dollars. We believe such incentives and support are vital to promoting good health and we encourage other systems around the world to adopt similar measures. Learn more about the U.S. Healthy People 2010 guideline at www.healthypeople.gov

2 Ozminkowski et al. Long-Term Impact of Johnson & Johnson Health & Wellness Program on Health Care Utilization and Expenditures. JOEM Vol 44, January 2002. Available at http://healthproject.stanford.edu/koop/Johnson%20and%20Johnson/pdf/Utilization%20and%20Expenditure.pdf.