By Cynthia H. Craft, Sacramento Bee

The federal health care overhaul is a complex structure woven through with carrots and sticks, incentives and disincentives.

Physicians get payments to implement sleek new electronic health records systems. Hospitals get penalized financially if too many patients require readmittance.

Now, in California, an Affordable Care Act grant is offering select Medi-Cal enrollees $20 retail gift cards in a leading-edge, anti-smoking trial. All they must do is call the California Smokers’ Helpline and complete the sign-up protocol to participate in telephone counseling sessions.

Skeptics may dub it dialing for dollars. But experts say the program may show monetary incentives to be an important tool in improving health and reducing the growth of health care costs in the long run.

An initial pilot project already finished in Sacramento showed positive results, doubling the number of calls to the Smokers’ Helpline, said Elisa Tong, an associate professor at UC Davis Medical Center and a member of the outreach team for the project.

Sacramento was a natural place to begin because it has an “embarrassingly high” number of Medi-Cal enrollees with health complications who smoke, Tong said. Medi-Cal is California’s version of the federal Medicaid program for people with low incomes or who have certain disabilities.

Compared with the statewide average of about 12 percent, 35 percent of at-risk Medi-Cal consumers in Sacramento are smokers.

California’s Department of Health Care Services recently expanded the pilot project statewide, to further test the effectiveness of offering financial incentives. Researchers involved in the project will identify Medi-Cal patients with chronic conditions and invite them to take part.

Within that group, some will be selected in a randomized, controlled trial to receive certificates of completion that can be traded for free nicotine patches. Another slice of the larger group will be eligible to receive $10 retail gift cards for each relapse-prevention call they complete to the hotline.

Also being tested is another tier of incentives for those who tried but were unable to quit smoking. This would allow a selected number of beneficiaries to receive up to $40 to re-enroll.

Broadly speaking, the California project is but one of many layers of carrots and sticks nestled in the Affordable Care Act with the aim of re-engineering the nation’s health care system into one of better outcomes, fewer mistakes and lower costs.

California received a federal grant of $10 million to pay for the program, which will target 75,000 Medi-Cal members over five years of incentives and study.

The state was deemed well-positioned for the project because the California Smokers’ Helpline has been up and running for 20 years at the University of California, San Diego.

Controls and tracking methods are in place to prevent fraud, Tong said, and the trained hotline counselors are able to weed out profiteers who may be attracted to the program by the $20 gift cards.

The gift cards are good at major retailers such as Walmart, Target and Safeway, said Norman Williams, deputy director for public affairs at the state Department of Health Care Services. Williams said it makes sense to seek out ailing Medi-Cal members who smoke to try to change their behavior.

“If you have a chronic disease, we are going to pay especially close attention to you,” Williams said, noting that treating tobacco-related disease absorbs 11 percent, or $15 billion, of Medi-Cal’s budget.

Tong hopes the hotline program will take hold in California’s rural areas, which have smoking rates among Medi-Cal enrollees as high as 45 percent.

“It’s long overdue in rural California,” she said. “We need to address this quickly.”

A 2004 study in the American Journal of Preventive Medicine determined that economic incentives to change consumers’ preventive health behaviors worked 73 percent of the time.

“Economic incentives are effective in the short run for simple preventive care, and distinct, well-defined behavioral goals,” according to the abstract of the study. “Small incentives can produce finite changes, but it is not clear what size of incentive is needed to yield a major sustained effect.”

Tong said California researchers hope to pull together a comprehensive picture of what combination of financial incentives are most effective at changing behavior.

Already, she said, the project is “helping to generate a lot of discussion about how this program can become a model for the nation.”