Intended for healthcare professionals


Can financial incentives improve health equity?

BMJ 2009; 339 doi: (Published 24 September 2009) Cite this as: BMJ 2009;339:b3847
  1. Adam Oliver, RCUK senior academic fellow
  1. 1LSE Health, London School of Economics, London WC2A 2AE
  1. a.j.oliver{at}

    Evidence shows that they might, if targeted appropriately

    Recently, much interest has been shown in how financial incentives can increase health enhancing behaviours.1 2 3 Two centres are studying the subject—the Centre for the Study of Incentives in Health (a joint initiative between King’s College, Queen Mary, and the London School of Economics; and the Center for Health Incentives at the University of Pennsylvania ( By encouraging healthier behaviours, it is hoped that incentives will help to contain healthcare costs and improve health. If the incentives motivate people in higher socioeconomic groups more than those in lower socioeconomic groups, however, they could exacerbate health inequalities. In the linked analysis article (doi:10.1136/bmj.b3504), Schmidt and colleagues highlight this as a potential problem in Germany, where a sickness fund rewards people for engaging in preventive activities and for minimising use of health care, which might encourage the less well off to forgo needed health care.1

    These are legitimate concerns, but we should not conclude that all incentives harm health equity. Studies across a range of interventions have shown that people within lower socioeconomic groups do sometimes respond significantly to incentives. Most of these studies were conducted in the United States, but their findings should be applicable to other countries.

    For example, vouchers redeemable for fruit juice significantly increased concentrations of β carotene in pregnant women on low incomes.4 This finding concurs with the Organisation for Economic Co-operation and Development’s recent recommendation that cash payments or food vouchers should be offered to materially deprived pregnant women to boost the take-up of antenatal services.5 Early visits to childhood health centres and uptake of vaccinations have been increased by financial incentives in Mexico, Nicaragua, Colombia, and Jamaica.2 A $10 (£6; €6.8) incentive significantly increased the uptake of mammograms in woman on low incomes aged 40-64 years.6 Financial incentives have also improved participation of intravenous drug users in a hepatitis B vaccination programme and a tuberculosis treatment programme.7 8 Several other examples of the positive effects of financial incentives have been published.9 10

    These studies show that in some areas of health care modest financial incentives can substantially affect the behaviours of the relatively poor. Healthcare incentives do not always have a positive effect, however, and evidence of a positive sustained effect on more complex lifestyle behaviours, such as smoking or weight loss, is lacking.3

    Some of the studies may have volunteer bias—volunteers may be particularly motivated to change their behaviour—and few studies provide adequate information on costs, let alone value for money. Moreover, the studies do not test the differential effect of incentives on the relatively poor versus the better off. Because less wealthy people do respond to incentives, health inequalities could be reduced if incentives were targeted at them.

    Targeting certain groups is controversial because it can breed resentment in the untargeted population. This can undermine solidarity, a key feature of European healthcare systems. Also, should the target be set at the family level (for example, families whose income is below a certain amount) or the geographical level (poor communities)? Because pockets of wealth often exist in poor communities, targeting at the family level seems the most sensible choice. Targeted interventions may be the best option in the current global financial climate because they are less expensive than those aimed at the population.

    Evidence indicates that appropriately targeted incentives could reduce inequalities in health outcomes. Ongoing assessment of their affordability, effectiveness, cost effectiveness, and unintended consequences is needed. Irrespective of the effectiveness of incentives, some people will argue that they do not tackle the root cause of poverty, and that money and health behaviours are incommensurate goods.11 Like all tools, financial incentives may have unfortunate consequences unless handled with care, but it seems premature and irresponsible to exclude them completely from the policymaking kitbag.


    Cite this as: BMJ 2009;339:b3847


    • Analysis, doi:10.1136/bmj.b3504
    • Competing interests: AO is a codirector of CSI Health (Centre for the Study of Incentives in Health), but he is not ideologically for or against the use of incentives. CSI Health is funded by a strategic award in biomedical ethics from the Wellcome Trust (grant no 086031/Z/08/Z).

    • Provenance and peer review: Commissioned; not externally peer reviewed.


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