HCI3 Update from the Field: Power of Intrinsic and Extrinsic Incentives

Submitted by francois.debrantes@hci3.org on Friday, July 6, 2012 - 12:15

Newtown, CT – July 6, 2012

Joey Chestnut's win offers us a lesson on the power of intrinsic and extrinsic incentives – it took 68 hot dogs and buns to win, and the crowd went wild. The other contestants faded away and the championship belt and $10K check went to Joey. It might be interesting to look at the fate of the champions and runner ups of prior years, although we can offer a guess….they're probably stented to the hilt and stomach stapled, and that's for the lucky ones. If the long term outcome of such egregious behavior is so clear, then why do so many choose to ignore it? In Joey's case, the answer is pretty easy. In the short run, winning means fame and fortune, far beyond the $10K prize, and the long term cost is uncertain and far away. In addition, there's no short term cost that might counter the short term gain. As such, the intrinsic incentive is to eat as many hot dogs as possible in order to win, and it's reinforced by an extrinsic incentive that rewards the eating. For all (or most) others, there's no reinforcing extrinsic incentive, but there's no countervailing one either. And that's a problem we need to fix.

What this means to you – there are many conditions, illnesses and even injuries for which there are few, if any, negative short term effects, and yet for which some lifestyle behavioral change is required. Diabetes is a good example, and it's not the only one. Failure to manage the condition well in the short term might go unnoticed for a while, and yet the long term consequences are negative. Behavioral lifestyle change is tough, very tough. And without an extrinsic incentive that either reinforces the need for that change, or creates an offsetting short term cost for doing nothing, the average consumer-patient will push off the needed change. It's human behavior and the yearly 4th of July hot dog eating contest reminds us of the power of these incentives. Most employers now have a smoker's penalty in their health insurance premiums, but what about all the other behavioral changes that are needed? We can't expect costs to get under control unless we tackle consumer incentives with as much gusto as provider incentives, and that includes incentives for Medicare beneficiaries. In the meantime, I think I'll have another beer with that cheeseburger and fries.


Francois de Brantes
Executive Director
Health Care Incentives Improvement Institute, Inc.
w: www.hci3.org