Cold hard cash the likeliest carrot for vaccine uptake

People line up at the Vaccination Centre inside the Glenquarie shopping centre in Macquarie Fields, Sydney. Picture: NCA NewsWire/Jeremy Piper

Most Australians view politics in the US as polarised and dysfunctional, but there are lessons to be learnt from the raft of incentives introduced there to increase the rate of Covid-19 vaccination.

Vaccine policies are largely determined at state level in the US. In all 50 states, those getting vaccinated can avail themselves of incentives. From Arkansas, which is offering fishing and hunting licences, to California, which has a Vax for the Win lottery, US states have introduced a wide range of reward schemes designed to raise vaccination rates.

What is notable is a high degree of bipartisan support for the incentives. Arkansas has a Republican governor and Donald Trump’s share of the vote in the election last year was 62 per cent. California has a Democratic governor and Trump’s share of the vote was 34 per cent. These states have little in common but both are offering incentives with almost no controversy or debate.

The diversity of incentives makes the US a policy laboratory. We recently conducted an experiment to quantify what worked best. We randomly showed one of three brief video messages to 1500 unvaccinated Americans, one on the health benefits of vaccination, one on cash or a cash equivalent such as a voucher as an incentive and one about being entered in a lottery as a reward.

The results of the experiment are clear. Cash incentives rather than vaccine lotteries were most likely to increase uptake, with an additional 5 per cent seeking information on where to get vaccinated after seeing the video indicating they might be eligible for up to $US100 in cash.

Australia has had a long history of employing financial incentives to promote vaccine uptake. Back in the 1990s, faced with low rates of childhood vaccination, Australia was one of the first countries specifically to link vaccination to incentive payments.

Vaccine incentive policy has a history of bipartisanship. The original policy was introduced by Liberal health minister Michael Wooldridge and involved a $200 payment. This was extended by the Labor government in 2012 to other types of government benefits and rebates. In 2015, when Scott Morrison introduced into parliament a further extension to what has become known as the “no jab, no pay” policy, he indicated it was “aimed at boosting childhood immunisation rates”.

There is a strong economic rationale for such a strategy. Vaccinated people not only benefit themselves by lowering their chance of contracting a disease but also benefit the community as they reduce the likelihood of disease transmission to others. A government payment is a way of recognising the external benefit vaccination confers to everyone.

Equally important is the impact incentives can have on raising vaccination rates. Take Britain, where nearly 90 per cent of adults have received one vaccine dose and more than 70 per cent of adults have had both doses. Unfortunately, even at this level of vaccination the Delta variant of Covid-19 is still spreading, with more than 100,000 cases across Britain last week.

The British Conservative government’s response has been to announce that it will work with firms such as Uber to offer incentives such as cheap taxis and discounts on takeaway food to increase uptake among younger people, where coverage is lowest.

In the US, the Biden administration announced late last week that all states should offer a $100 cash incentive to the newly vaccinated and that this would be paid from stimulus funds.

The other approach to increasing vaccination coverage is penalties. France’s President, Emman­uel Macron, has taken a step down this road by indicating that proof of full vaccination, or a negative test, will be required for the French to go to cinemas and restaurants. While this appears to have had the desired impact on vaccination uptake, it also has brought a quarter of million people on to the streets to demonstrate against it.

There needs to be debate about the level and type of incentives or penalties that are required to ensure Australia reaches a level of vaccine coverage that enables opening up. However, this should be informed by evidence, including randomised experiments similar to the one we recently conducted in the US.

If the Australian government takes the carrot of incentive payments off the table, all it will be left with are sticks.

Philip Clarke is director of the Health Economics Research Centre at the University of Oxford and holds a professorship at the Centre for Health Policy, University of Melbourne.