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Why Pay Employees to Exercise When You Can Threaten Them?

More companies are choosing sticks over carrots to cut insurance costs. A study shows how it works.

When it comes to getting people to participate in workplace weight loss programs, financial rewards may not be much of an incentive. Penalties, on the other hand, work great.

For three months, 281 employees at the University of Pennsylvania participated in a step challenge. The goal was to walk at least 7,000 steps a day. Researchers used different incentives: One group got $1.40 for each day they met the goal, while another got $42 up front each month, and lost $1.40 for each day they didn't finish. Also participating in the study, published Monday in the Annals of Internal Medicine, was a group that got to enter a lottery to win $1.40 each time the goal was reached, and a control group that got no money at all.

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