What 'Cash for Clunkers' Teaches Us About Health Club Sponsorship for Wellness by Employers or Government
Posted Aug 06 2009 10:36pm
The Disease Management Care Blog, like Casablanca's Captain Renault, was shocked, SHOCKED (not) to hear on NPR's All Things Considered that there are some economists who doubt whether the United States' 'cash for clunkers' program is a wise investment. These must be the same guys that told the DMCB years back that insurer or employer-based incentives for fitness club memberships was also a silly idea.
The arguments are simple and convincing. While financially supporting fitness clubs is associated with superficially gratifying uptakes in membership, there are two problems:
1) many of the persons qualifying for financial support would probably join a fitness club anyway; all you're doing is using precious premium to unnecessarily subsidize it. This was the same argument on today's NPR broadcast: there are probably many car owners with an old set of wheels that are destined for a trade-in anyway. Cash for clunkers merely helps make it happen sooner at an additional cost of up to $4500 to the U.S. Treasury, er, make that to us taxpayers.
2) many of the persons qualifying for financial support may not necessarily need to join a fitness club; the joiners are far less likely to find exercise a distasteful chore and are already active. In the meantime, the persons who could really use some exercise are unlikely to be motivated by any financial incentive. The same may be true in the 'clunkers' program: the cars being destroyed arguably still have some value, and many have acceptable if not optimal mileage. In the meantime, many other persons will have plenty of reasons - like not taking on the debt of new car payments - to keep enough really bad clunkers on the road for years to come, not help Detroit's doldrums and not reduce their carbon footprint.
The DMCB did a literature search to disprove either of these arguments. It was unable to find any.