Yes. HealthyWage is legal. HealthyWage offers research-based challenges that make weight loss more successful by making it more fun, and by providing financial incentives that help you avoid procrastination and quitting.
We sometimes describe our programs as a “bet” or a "wager" (and other helpful colloquialisms, like "investment") because those terms help you understand the double-incentivization model – i.e., you lose your monetary deposit if you do not achieve your goal (i.e., the negative incentive), and you earn money if you achieve your goal (i.e., the positive incentive). In esoteric academic parlance, these programs are called "deposit contracts," but we don't find that term very helpful.
As a legal matter, the HealthyWage deposit contracts have nothing to do with gambling because participants are in complete control of the outcome. The deposit contract programs are neither games of chance nor games of skill. They are not games at all. They are ordinary contracts, contingent upon the performance of a task within the control of the payee.
We think the reason that we sometimes get asked whether HealthyWage is illegal is that outcome-based monetary health incentive programs are relatively new. Although many folks are as yet unfamiliar with this area of health care, it has found widespread embrace by leading medical, wellness, government and corporate actors, and by lawmakers.
HealthyWage’s deposit contract programs are modeled after similar contracts that have been offered to participants in recent influential studies – see, e.g., Volpp, K.G., John, L.K., Troxel, A.B., Norton, L., Fassbender, J., and Loewenstein, G., “Financial Incentive-based Approaches for Weight Loss: A Randomized Trial,” Journal of the American Medical Association, 300(22), 2631-37 (2008). The format has proven to be very effective at enhancing weight loss success.
Many corporate and government clients, including Fortune 500 companies, rely on HealthyWage to design and implement incentive-, competition- and team-based challenges for thousands of employees, and HealthyWage and some of its competitors also offer programs for consumers. These programs are important because they harness powerful human behavior concepts and use them for good – e.g., employing negative incentives (i.e., participants lose money if they fail to reach their goals) and positive incentives (i.e., participants win money if they achieve their goals) to bring about weight loss (and other health outcomes). The explosion of monetary health incentives was triggered by a raft of recent academic and industry research, which shows that monetary incentives can enhance the effectiveness of weight loss interventions (e.g., going on a diet) by providing the participant with, among other things, a temporal focus (i.e., a reason not to procrastinate) and, although less obviously scientific but no less true, by making dieting more fun.
We think it is clear that these programs have an important place in society. Not only are they legal and widely sanctioned, they should be further encouraged by governments at all levels. We welcome your comments and questions – please contact us at firstname.lastname@example.org.