NEW YORK CITY—The bustling food market on the corner of 165th Street and Grand Concourse in the Bronx almost has a casino feel, except that the chips are dull brown, and rather than cherries on a slot machine real fruit and vegetables are lined up on display. But the cheers are no less exuberant: "This is so awesome!" exclaims one happy customer clutching a handful of tokens and tomatoes. "It's just like Atlantic City."

With a swipe of a food stamp debit card on a handheld credit machine, shoppers at the Harvest Home Farmers Market receive a stack of wooden tokens worth a dollar apiece. And for every five they cash in for bananas, lettuce and the like, they win a two-dollar "Health Bucks" coupon to buy more.

A growing number of local programs from Boston to San Diego are trying to make healthier foods more appealing and affordable for low-income families—the population of Americans who are most reliant on food stamps, and most likely to be obese. Meanwhile, public health researchers are looking hard at the federal food stamp program itself, now known as the Supplemental Nutrition Assistance Program (SNAP). They're questioning why the long-standing strategy for helping the hungry may, in some cases, actually be hurting their health by packing on extra pounds. But could a few simple changes transform SNAP into a powerful vehicle for curbing obesity?

"There needs to be a way for a family to not have to choose between hunger and obesity," says Lauren Dinour, a nutrition expert at the City University of New York. "I see huge potential in some new ideas."

While obesity rates have risen to about 30 percent of the U.S. population—carrying with it an epidemic of diabetes—food stamp enrollment has also exploded. About one in eight Americans now rely on the assistance, according to data just released from the U.S. Department of Agriculture (USDA), up from one in 50 people in the 1970s.

A separate study, published last August, linked these two striking statistics. People never receiving food stamps had lower rates of obesity than those who had been on them at some point in their lives, even after accounting for differences in socioeconomic status. This effect was most striking for white women: a two-unit increase in body mass index (BMI)—a standard assessment of weight that takes one's height into account. (A BMI of 30 or higher is considered obese.)

"Obesity cannot be totally pinned on food stamps," says Jay Zagorsky, a research scientist at The Ohio State University's Center for Human Resource Research and lead author of the study, "but it certainly is related to how the program is structured."

The full monthly SNAP allocation, now averaging $124 per person nationwide, is provided at the beginning of each month. Research published in 2000 concluded that the bulk of participants also do their grocery shopping once monthly, shortly after the benefit is credited. (Wal-Mart reports a spike in sales at 12:01 A.M., as soon as federal assistance funds hit SNAP accounts.)

Another study from 2004 found a corresponding decrease of 10 to 15 percent in food consumption over the course of the month, suggesting some recipients may eat well for the first couple weeks after they've shopped and then run low on food near month's end. This kind of "binge–starvation" cycle has been linked to changes in metabolism, insulin resistance and, ultimately, increases in BMI.

Now that funds are delivered electronically rather than as paper "food stamps," however, the additional cost to distribute SNAP money every other week would be minimal. Participants themselves have suggested that the change could help them spread out their grocery shopping and keep adequate food around through the month, notes Parke Wilde, an agricultural economist at Tufts University's Friedman School of Nutrition Science and Policy in Boston and lead author of the shopping cycle paper. "It's just a little change in the environment that still gives people freedom [to shop as often as they want], yet gives them a slightly different sense of the default behavior," he says. "I'm always surprised that there's not more interest in the idea."

Obesity risk also weighs heavily on the choices people make on their shopping trips—and the choices made available by retailers. In many urban neighborhoods the most convenient places to shop are corner stores, such as the bodega down the street from the Bronx farmers market. Inside this store, past the rack of Little Debbie brownies, is a cash register framed by salt, fat and sugar. On the left are plastic compartments filled with Charleston Chews and Starbursts; on the right, Mike and Ike's and Planter's Peanuts. Double Bubble sits atop a cooler filled with caffeinated Monster drinks, alongside a cold case of ice cream. All of it can be purchased with food stamps.

Although often proposed, the idea of narrowing the list of foods eligible for purchase with SNAP funds has been stymied due to fears that fewer eligible people would participate, the prices of healthy foods could rise or marketers would simply repackage a candy bar to look like a granola bar. Similar concerns arise over adding taxes or fees to unhealthy foods. Focusing on positive reinforcement, such as financial incentives, "dodges that trouble," Wilde says.

The USDA's Economic Research Service recently found that a targeted 20 percent price reduction for fruits and vegetables would raise the average SNAP participant's daily consumption of these foods by about a quarter of a cup. A New Zealand study published in December highlighted an 11 percent increase in the purchase of a wider range of healthy foods when a 12.5 percent discount was applied. This positive effect even remained significant six months after those discounts were removed.

Wilde is anxious for results from a larger, more rigorous study set to begin in the fall of 2011. The USDA-run "Healthy Incentives Pilot" evaluation will assess the effects of a 30 percent reduction in the cost of fruits and vegetables purchased with SNAP funds. The program's update from paper coupons to debit cards, combined with current checkout technology, has made automatically adjusting the relative price of certain foods more feasible. In this case, the discount will be applied indirectly in the form of a rebate.

These price cuts may also be tested in conjunction with nutrition education. "It would be a powerful combination," Wilde says, "similar to what marketers use to promote food products: communication with the customer and a real dollar benefit." Whereas SNAP already runs nutrition courses that have proved effective in studies, they are not yet mandatory to all participants. Once again, local programs are working to fill in the gap. Select New York City farmers markets even offer lessons on how to cook with fruits and vegetables that some shoppers may never have seen before.

"There's a lot of innovation going on in farmers markets and various other programs within municipalities," Wilde says. "But it would be even better to see fruit and vegetable promotions through all retail channels." Depending on the outcome of the pilot study, a SNAP revamp could bring such pervasive changes by the end of 2013.