Pact Is First Health App To Become An Insurance Plan

“(Pact Health is T)he first health app to use individuals health data to lower their health costs…punishments are way more effective than rewards. ‘What gets you to do the very difficult thing of getting your butt off the couch and into the gym isn’t the couple of bucks you’ll earn.’ It’s the couple of bucks you’ll lose. ‘A loss is three times more motivating than a gain.’ Punishing insurance members for unhealthy metrics is nothing new. Safeway, the grocery chain, has famously kept a lid on its health care costs by taking away premium discounts from staff who don’t do well on regular biometric scans. But ‘that’s a very crude way of using negative incentives.’ There is, in other words, a subtle art to effectively punishing people. Pact has learned you have to give people a chance to redeem themselves. Once its users lose $5 for not fulfilling a workout, they have two weeks to recover that money back along with any extra rewards. ‘That prevents them from leaving the program,’ which is surely what any business would hope for.” –

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