Corporate Competitions Offer Employees Incentives to Lose Weight, Gain Cash

Is corporate America taking a page from "The Biggest Loser"?

You bet.

In an effort to reduce health care costs, a growing number of companies are offering cash to overweight workers who lose weight.

“People really get into competing and winning,” says David Roddenberry of Healthy Wage; “whether there’s a huge prize attached or a little prize.”

Roddenberry started Healthy Wage three years ago hoping to make money while helping people shed unhealthy pounds. He acts as sort of a weight-loss bookie, setting up corporate competitions and letting individuals bet on themselves to lose weight. Put up $100 and if you lose 10 percent of your weight, you double your money. If you fall short, your money goes to paying someone else’s winnings.

Five employees of LSG Sky Chefs, based in Dallas, paid $60 to enter a nationwide competition against hundreds of teams. Thirteen weeks later, each had lost more than 20 percent of his weight.

Neil Ylanan was the biggest loser, shedding 100 pounds.

For their efforts, the men won the top cash prize of $10,000.

“We’re happy, we lost a lot of weight and we’re healthier,” says Ylanan. “And you know, motivating people at times needs to come from different sources.”

By all accounts, behaviors have to change. The Centers for Disease Control and Prevention says one-third of American adults are obese. It’s the main reason diabetes has become the No. 1 health threat in the U.S., chewing up $116 billion a year in excess medical care and $58 billion in lost productivity.

According to the American Diabetes Association, one in 10 health care dollars spent is attributed to diabetes.

'The Right Choice'
Premera Blue Cross in Washington state offers companies tiered insurance plans allowing healthier employees to pay lower premiums than overweight workers or smokers.

Marcia Ridley, who manages the Vivacity program for Premera says the cost shifting is fair.

“We all have a personal accountability to our health and to the costs of health care in society,” Ridley says.

Tom Thompson works at Premera, and says he was overweight until the company made him a deal he couldn’t refuse: Sign up for Health 365, a wellness program that requires biometric screening, risk assessment and frequent weighing, and get paid $50 with a chance to win an additional $250. Thompson has since lost 27 pounds and credits the financial incentives.

“It was an instigator for me to take control of my health and change my eating habits,” Thompson says.

King County, Washington, is also finding success dangling carrots. It offers much lower insurance deductibles for workers who get healthy. A family of four can save $1,200 a year. Ninety percent of the county workers are enrolled in the program and 2,000 of the most overweight have lost 24 tons. Smoking rates among employees are also down to 6 percent. The statewide average is 17 percent.

Officials say they’ve saved taxpayers $61 million in health care expenses over the last two years.

“We make the right choice, the easy choice for employees,” says Caroline Whalen, King County benefits administrator .

There is, however, some cost-shifting going on. Employees who don’t sign up for the weight-loss plans pay higher rates than they did before. And a growing number of companies are penalizing smokers with big insurance surcharges. Wal-Mart workers who smoke pay $2,000 more per year for their health care plan.

Some worry the trend will lead to those who need health care the most dropping their insurance because they can’t afford it. But Tom Curry, executive director of the Washington State Medical Association, thinks even the punitive measures will lead to a healthier workforce.

“If we had our druthers, I think we’d fall more on the side of the carrots rather than the sticks,” Curry says.“But the overarching idea we support is the idea of incentives to change behaviors.”