Paying People to Make Healthy Choices

Paying people to make healthy choices is a promising response to a genuine social problem. Many people engage in behaviours that are not only destructive of their health but also impose significant financial burdens on themselves and their societies. Paying people to make healthy choices can be more effective than the mere provision of information, while also being more efficient and ethical than outright prohibitions of unhealthy behaviour. An enormous range of empirical research confirms this basic insight. However, when it comes to the success of any given programme, the devil is in the details. Health incentive programmes need to be carefully designed and evaluated to ensure that they are indeed effective, efficient and ethical. Moreover, special attention must be paid to concerns about equity, unjustified paternalism, the effects on character and perverse incentives that can generate unintended consequences.