Blueprint for an Active Australia

Action area 11: Financial incentives

Authors: Joseph Carrello, Stephen Hodge

Strategic priorities

Key strategic priorities in the application of financial incentives to promote physical activity:

• Embed appropriately designed financial incentives within relevant policy and program settings to reduce financial barriers and increase physical activity participation, particularly for priority populations and other insufficiently active groups.
• Develop, implement and evaluate research and demonstration trials of financial incentive approaches across multiple contexts, delivered in partnership with diverse stakeholders (e.g. public transport providers, private health insurers, sporting organisations), to inform scalable policy and funding decisions.

Sustainable Development Goals

The United Nations Sustainable Development Goals¹ that relate to using financial incentives to promote physical activity include:

For more information see Appendix 1

Consider the case for using financial incentives to support and promote physical activity behaviour:

• Financial incentives can make good health affordable by reducing financial barriers to physical activity. They contribute to ensuring people have access to safe, inclusive environments and diverse opportunities to be active in their daily lives.
• Socio-economic factors should not be a barrier to participation in physical activity in Australia. Increased cost-of-living pressures disproportionately impact people of low-socioeconomic status,² who tend to be less physically active,³ and experience the greatest barriers to being physically active as part of their daily lives.^4,5
• Regulatory and economic/fiscal strategies have been effective when used in tobacco and alcohol policy,^6,7 but have been less commonly applied in physical activity policies.
• Lack of access and motivation to be active are commonly reported as barriers to physical activity, with over 37% of adults reporting they ‘don’t have enough time’ or have ‘too many other commitments’.⁸ Financial incentives can be used to motivate and encourage people to be more active,^9,10 while simultaneously reducing costs associated with physical activity.
• Evidence shows that financial incentives, especially when coupled with goal setting strategies, may be effective in increasing physical activity.^11-15 When used by less active people, financial incentives support behaviour change.
• Incentives do not have to be of high value; amounts as small as $50–200 can be an effective strategy for increasing participation in physical activity.^15-17
• Taking action to be more physically active and maintain this over time is challenging. Financial incentives can help to ‘nudge’ or provide additional motivation for individuals to adopt physical activity, particularly if they already have an interest in being active.¹⁸

What financial incentives are working well to promote physical activity?

Some incentive schemes have been implemented within Australia. These are documented in the following points.

• Private health insurers value policy holders who are physically active; many provide rebates, discounts and rewards to support more active lifestyles. For example, a financial incentive program provided by Australian private health insurers consisting of an annual $200 cash payment (contingent on meeting weight loss/maintenance goals) alongside a one-year commercial weight loss program that included physical activity, was found to be a cost-effective strategy ($7,376 per health-adjusted life-year [HALY] gained).¹⁹
• Several state and territory governments in Australia provide lower public transport fares for priority populations (including students, seniors, people living with a disability and other welfare recipients) to incentivise those groups to use public transport, thereby increasing associated active transport. The QLD Government has introduced universal subsidies for public transport, reducing all trips to 50 cents, while the Tasmanian Government is currently providing free public transport.^20,21 A Tasmanian study reported that 46% of adults who took advantage of a trial of free bus fares used the bus more frequently, with average weekly trips increasing from three to four.²² As public transport use is associated with walking behaviour, promoting the use of public transport promotes physical activity.²³
• Subsidising registration in organised sport and active recreation programs has been trialled across Australia.²⁴ These programs have strong public support and have demonstrated high uptake and large-scale feasibility. There is growing evidence that financial incentives for children’s and adolescents’ sport and active recreation may increase physical activity participation.^25-27
• The greatest benefits from financial incentives for organised sport and recreation among school aged children have been observed among priority populations.^26,27 The South Australian Government’s Sports Vouchers Plus program provides a universal voucher to promote sport and active recreation participation and ease cost of living pressures for families.²⁸ However, providing subsidies or ‘sports vouchers’ to all children has not achieved sufficient improvements to shift population levels of physical activity.²⁹ Additional work is required to ensure priority populations benefit from financial incentive programs.

Policy, practice and leadership

• Recommendations for federal, state and local governments in the use of financial incentives to promote physical activity:
• Implement interventions and trials of financial incentive programs, informed by behavioural economics principles.¹¹ Incentives should be tailored over time, by adapting their value or availability for consumers, to ensure they remain effective.
• Explore how the private sector, such as health insurance companies and workplaces, may partner with governments to deliver comprehensive programs using financial incentives to support people to be more active.¹⁹

Organisation and service delivery

Recommendations for application in healthcare settings and workplaces:

• Make active choices the default by requiring people to opt-out rather than opt-in to incentives, rewards and discount programs that support health and wellbeing.³⁰ Allow people to earn credits and rewards by participating in physical activity programs.^15-17
• Invest in financial incentive programs that recruit participants in healthcare settings and enable healthcare workers to support people to engage in, and adhere to, physical activity goals and exercise prescriptions. Financial incentives coupled with goal setting may be effective in increasing physical activity.^11-15
• Introduce workplace wellbeing or active travel strategies. These could include subsidised gym memberships, access to shared bike systems, reduced access to car hire for short trips and increased parking costs.³¹

Community awareness and engagement

• Involve stakeholders and community groups in the development of financial incentive strategies to motivate physical activity participation among those who might not otherwise participate. People of low socioeconomic status tend to be less active and face the greatest barriers,^3-5 and the greatest benefits from incentives have been seen among priority populations.^26,27 Interventions should be culturally sensitive and relevant to the most inactive sectors of the population.

Research, data and innovation

A review of the evidence for this action area identified the following priorities for investment in research, data and innovation.

• Invest in research on the use of financial incentives and goal setting to enable better adherence to physical activity programs, particularly among people living with heart disease, diabetes and other chronic conditions. Determine whether people who receive financial incentives maintain higher activity levels after incentives are removed, to inform future investment.
• Use behavioural economic principles to understand how decisions to be physically active are shaped by economic and psychological factors, including biases and social norms.
• Further investigate the effectiveness of financial incentives to address individual behaviour change barriers such as ‘not enough time’ and ‘too many other commitments’^.8
• Investigate the conditions that cause spikes in people using share bikes for short trips and understand how financial incentives support greater uptake, reducing the need for private vehicle use for short trips.
• Scale up efficacy trials of financial incentives to evaluate real world implementation and impact on behaviour change.
• Evaluate the impact of public transport concession fares, and subsidies that include strategies which encourage shifts to more active transport modes, especially in disadvantaged areas.
• Conduct evaluation to understand the impact of subsidising active transport equipment on physical activity and mode shift to active transport.
• Rigorously evaluate interventions that include financial incentives. Evaluations should assess impacts on physical activity and health outcomes, as well as co-benefits such as environmental impacts (e.g. air and noise pollution, carbon emissions), and social and economic outcomes.
• Conduct further studies and trials with adaptation or re-design of financial incentives for organised sport and recreation programs, to boost physical activity levels among priority populations of children and adolescents.
• Develop and evaluate policies and programs that include financial incentives to encourage councils and developers to build supportive environments for physical activity, with provision of data on trends and health outcomes to inform impact on built environments.
• Use digital tools such as smart watches in physical activity programs, and deliver financial incentives immediately after people achieve their activity goals, to provide instant gratification and boost motivation.
• Conduct further research to better prioritise equity when implementing financial incentives for physical activity. Participatory methods should be used to ensure priority populations are actively involved throughout program design and delivery.

Heart Foundation related information for financial incentives