Medicare recipients smoke 10 percent more than the general population, and new programs are targeted at reducing that number. Image: MoneyBlogNewz/ Flickr / CC BY

Medicare is an expensive program. In 2010, the program is estimated to have cost $452 billion, 12.5 percent of the federal budget. A new $100 million program aims to reduce these costs by incentivizing weight loss and smoking cessation.

$100 million grant for incentives

The major health care overhaul bill passed about one year ago included a $100 million grant for specialty state Medicare programs. This health care incentive program is supposed to be used to create incentives for Medicare recipients to lose weight and quit smoking. Financial rewards can be in the forms of gift certificates, coupons or cash. States are allowed to design their own programs, but in general, the federal guidelines require that Medicare recipients “demonstrate a commitment to improving their health” in order to be offered the rewards.

Weight and smoking targeted by incentives

The health-care incentives are intended to help those on government-supported health care develop better habits. About 10 percent more of the current population of medicare recipients smokes compared to the general population, and chronic conditions account for half or more of the spending on Medicare in the U.S. The federal health care guidelines will likely be formatted in ways similar to Idaho’s or Florida’s programs. Idaho provides $200 for gym memberships and weight-loss programs if a Medicare recipient consults with a doctor about losing weight. Florida offers a $125 credit for a litany of healthy behaviors.

The effectiveness of Medicare incentives

Though most states have yet to outline their intended use for their incentive money, there are already questions of effectiveness. Many companies have provided health incentive programs, some reporting as much as 38 percent savings from the move. Other states, such as Alabama, have researched the possibility of levying health insurance surcharges on Medicare recipients who are obese or who smoke. In the end, these incentives (or disincentives) will only work if the targeted population both knows about them and has the tools to meet the requirements. Offering an incentive to low-income individuals to lose weight, for example, will do no good unless that person also has access to healthy food — something most food stamp programs simply do not offer.


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