Sunday, May 31, 2009

Health impact requires both Engagement and Benefit from Solution

Just saw a great comment on the Healthcare X PRIZE from Notions' Oceans:

Consumer(1) engagement: Consumers must opt-in to any programs the teams offer. The assignment of people to a team makes high rates of participation a requirement for success.
And there's the rub: People do things that are harmful to themselves. And, just as infuriatingly, people irrationally do other things with no demonstrable benefit in hopes of protecting themselves. An X Team can tell people not to smoke, for example, but who hasn't heard that before? In fact, is there anyone in America who smokes but hasn't heard, at least a million times, that smoking causes lung cancer, emphysema, chronic bronchitis, bladder cancer, hastens heart disease, etc, etc, etc? Or food: who would choose hypertension, hypercholesterolemia, diabetes, coronary artery disease, and non-alcoholic steatohepatitis over health? Everyone who eats beef more often than once a week, it turns out, and probably everyone who eats McDonald's more than once a month.

But on the other end of the spectrum are those who obsess over organic produce, ear candling, full body CT scans, executive physicals, and the like, who waste just as much effort from an overtaxed cohort of physicians, nurses, hospitals, and fellow insurance purchasers as the souls who indirectly choose tobacco, fat, and salt over health.
Its a great point that you need two ingredients for better health from any program:
  1. People need to participate in the program
  2. The program actually needs to improve that person's health
Many of the commercials I see touting health benefits drive me nuts...there is very little evidence that this "healthy option" actually accomplishes anything for the individual taking it. (ie, if you slightly lower your cholesterol, but have .00005% chance of having a heart attack, did you accomplish anything?, do you need 100% of your daily vitamins and nutrients in your breakfast if you plan on eating more that day?)

All of these are fine marketing tactics for given products, but they do add to the noise and confusion for those of us actually trying to improve the health of our communities.

Our competition has been designed in a way that teams need to both understand what works (and for each individual in their care) and engages them in the most important solutions (this would focus on absolute risks for each individual rather than relative improvements across populations like we see in pharmaceutical trials today). We look forward to seeing the innovations of our teams in generating relevant solutions for individuals: both impactful and engaging.

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Tuesday, May 26, 2009

Blog Rally: Transcript for Transformation

On March 26, 2009 the leading health care bloggers (see list below) throughout the blogosphere participate din a Blog Rally to raise awareness for public participation in the Healthcare X PRIZE design. Bertlan Mesko, leading Medicine 2.0 Advocate and author of the popular Science Roll blog, also conducted a "Twitterview" in support of the effort.

Berci: Can we start the twitterview now? I’d have 10 short questions, you may have 10 short answers. So everyone can enjoy it.

HealthXPRIZE: Thanks for taking the time. We appreciate your help in getting the word out. This Twitterview will complement the Blog Rally. Ready!

Berci: Great! First, what is the X PRIZE Foundation? What is the X PRIZE model?

HealthXPRIZE: The X PRIZE Foundation is a non profit organization that conceives and operates large incentivized prizes that lead to revolutionary breakthroughs. The X PRIZE model is based on leveraging a large purse, with a clear set of rules, that allows innovators to break through barriers.

Berci: Please tell us more about Healthcare X PRIZE!

HealthXPRIZE: The Healthcare X PRIZE is intended to be a competition to redefine health and demonstrate how new models of care can dramatically increase health value. We chose to focus on health value as opposed to a new wonder drug or device as our sponsor (WellPoint and WellPoint Foundation) & advisors were most interested in a systems prize. Systems prizes are much more difficult to conceive and operationalize than technical competitions like going to space or even replicating the genome rapidly. We are expecting that teams will need to innovate around health finance, care delivery, and individual incentives to increase health value. We are currently developing a clear set of rules, which provide the parameters of competition, as we believe that “creativity loves constraints”.

Berci: Reforming the US healthcare system is quite a brave mission, isn’t it? Why the focus on health value?

HealthXPRIZE: The US Health reform gets serious this summer and the HXP is well timed to actually demonstrate and prove in practice the principles of reform. Value is powerful organizing principle for reform efforts - we cannot just reduce costs, nor can we just attempt to improve quality without financial accountability. The focus on health value highlights the need to focus on both sides of the equation. Since Value =outcomes/cost, we are challenging teams to improve both simultaneously.

Berci: Why use an incentivized competition?

HealthXPRIZE: Incentivized competitions are very efficient, highly leveraged, and create an “X” factor within the competitive framework. Sponsors only pay the winner, a $10MM purse typical spurs >$100MM of investment, and the X factor creates global media attention to a key problem, inspire hero’s, encourage non-traditional thinking, and creates a powerful incentive for innovation.

Berci: And how can you properly measure health value? I guess you need pre-defined parameters. What are these?

HealthXPRIZE: Health Value has never really been measured within the US Health Care system. There are many efforts underway right now to properly define and measure health value. Many innovators are leading the way and we are attempt to build on their work or actively collaborate with new/ongoing initiatives (Dartmouth, IHI, AHRQ, etc) to solidify the health value measurement framework. In the context of competition, we are trying to make our measurement framework as concrete as possible by focusing on outcomes (mortality, specific morbidity, ED visits, hospitalizations, sick days etc.). Effectively communicating the notion of “health value” remains a challenge; we are considering focusing on aspects of health value (like decreased hospitalizations and sick days) as a more effective way to communicate to the public the hoped for prize breakthroughs.

Berci: How are the Teams and Test Communities Selected?

HealthXPRIZE: Teams will be selected by through a series of concept design and testing evaluations. They will be required to demonstrate or model the impact of their proposed interventions against test database provided by WellPoint. Independent judges will evaluate the merit/validity of the concept in order to advance. Communities will be selected based on specific criteria that are still being worked through. Intent is to have a defined population of 10K participants from which Teams will voluntarily enroll in the intervention. Test community will be matched against a geographically adjacent control group. Both the team and community selection requires further design, detailed analysis, and expert opinion which we are soliciting at this time through our network of national measurement experts.

Berci: When does this competition start and when will it end?

HealthXPRIZE: The “competition” has several phases: Design, Selection, Competition. We are currently in Design phase through our anticipated Launch later this fall. The Design phase includes soliciting public comment on how we can improve our initial concept/construct to create the most viable competition possible. After official “Launch”, we will begin recruiting teams to compete. Teams will then be narrowed as described above through late Spring 2011 when 5 finalist selected. After a brief integration period into test community, HXP competition is planned to officially begin in January 2012.

Berci: How does this shift the paradigm? What kind of outcome do you expect?

HealthXPRIZE: Great question - we believe the current paradigm is based on volume not value, on process not results, and incents the wrong behaviors while delivering bad outcomes. We want to shift the paradigm to rewarding the reduction of hospitalization / sick days and begin to pay for overall health improvement (this is the outcome we want!). We also want to not focus solely on disease care, and aren’t interested in just improving health care; but believe that we must move to an entirely new notion of engaged, activated health called “Vitality”. We want to demonstrate that this CAN be done at scale, with new entrants / new ideas, and want to set the HXP up as a framework from which these efforts can be tackled in the real world. By focusing on outcomes, instead of regimenting care processes or dictating care delivery, let providers/patients innovate and create rewards for those who obtain the best outcomes.

We believe incentivized competitions are a great vehicle from which we can accelerate change, shift the paradigm, and be a catalyst for the transformation that is required for the US healthcare system. We hope the outcome is a new way to think about health, measure health value, and demonstration of new models of care that demonstrate how to improve community health and individual vitality.

Berci: My last question, regarding X-PRIZE - first rockets, then genomics, now healthcare. What do you think? What’s next?

HealthXPRIZE: XPRIZE is a mission driven organization seeking to inspire the very best in human kind for the benefit of all – this isn’t just a nice quote. It is inherent in the DNA of the organization. We are attempting to be the catalyst in any “stuck” industry by creating incentivized competitions that can lead to radical breakthroughs to the grand challenges of humanity. HXP is now looking at education, energy (some really cool stuff), and developing world initiatives that can truly have major impacts. Fortunately for me, HXP is our focus for launch this year. It is quite challenging work, deals with multiple hard to think through issues, but includes the privilege to work with great people and teams including our sponsor WellPoint.

I have been thrilled with the level of commitment to this process and this prize development process has been tremendous experience. They have a very talented innovation team, led by Chad Pomeroy, who is fully supported by senior executives all the way up to Chief Executive Officer Angela Braly. They have been driving this initiative forward far beyond the $10MM prize purse; they are providing operational resources, sharing data, working to create appropriate test communities, altering business practices to accommodate the prize, and are committed to transparency as part of the HXP process. Their commitment to the project is the reason I became involved as I saw an unprecedented opportunity to really implement the innovation in an idealized but competitive test environment. We appreciate WellPoints leadership, foresight,and commitment to engage X PRIZE in developing the Healthcare X Prize for benefit of all. Very cool stuff.

Berci: Thank you very much for the interesting answers! I will publish the transcript on in a few minutes.

HealthXPRIZE: Berci, again, thank you for this twitterivew. We hope to have everyone visit our website, download the initial prize design, comment on our blog, and add their input to the Prize Design process.

Thanks to all the bloggers who participated (will add more as becomes available):

Incentive to Innovate: Giving Health Reform a Rocket Boost

Blog Rally to raise awareness of the $10MM Healthcare X PRIZE incentivized competition to harness interest of global health innovators.

We are entering an unprecedented season of change for the United States health care system. Americans are united by their desire to fundamentally reform our current system into one that delivers on the promise of freedom, equity, and best outcomes for best value. In this season of reform, we will see all kinds of ideas presented from all across the political spectrum. Many of these ideas will be prescriptive, and don’t harness the power of innovation to create the dramatic breakthroughs required to create a next generation health system.

We believe there is a better way.

This belief is founded in the idea that aligned incentives can be a powerful way to spur innovation and seek breakthrough ideas from the most unlikely sources. Many of the reform ideas being put forward may not include some of the best thinking, the collective experience, and the most meaningful ways to truly implement change. To address this issue, the X PRIZE Foundation, along with WellPoint Inc and WellPoint Foundation as sponsor, has introduced a $10MM prize for health care innovators to implement a new model of health. The focus of the prize is to increase health care value by 50% in a 10,000 person community over a three year period.

The Healthcare X PRIZE team has released an Initial Prize Design and is actively seeking public comment. We are hoping, and encouraging everyone at every opportunity, to engage in this effort to help design a system of care that can produce dramatic breakthroughs at both an individual vitality and community health level.

Here is your opportunity to contribute:
  1. Download the Initial Prize Design
  2. Share you comments regarding the prize concept, the measurement framework, and the likelihood of this prize to impact health and health care reform.
  3. Share the Initial Prize Design document with as many of your health, innovation, design, technology, academic, business, political, and patient friends as you can to provide an opportunity for their participation
We hope this blog rally amplifies our efforts to solicit feedback from every source possible as we understand that innovation does not always have a corporate address. We hope your engagement starts a viral movement of interest driven by individual people who realize their voice can and must be included. Let’s ensure that all of us - and the people we love - can have a health system that aligns health finance, care delivery, and individual incentives in a way that optimizes individual vitality and community health. Together, we can ensure the best ideas are able to come forward in a transparent competition designed to accelerate health innovation. We look forward to your participation.

Special thanks to Paul Levy for both demonstrating the value of collaborative effort and suggesting we utilize a blog rally for this crowdsourcing effort.

Friday, May 22, 2009

Incentive to Innovate - Invitation to Entrepreneurs of all Flavors

BT X_Foundation Logo col.jpg



C-suite executives, foundation, political and academic leaders, and social entrepreneurs are invited to join cutting-edge innovators to collaborate on business solutions that can deliver immediate bottom-line results

Playa Vista, Calif. (May 21, 2009) – The X PRIZE Foundation, with its partners BT Global Services, John Templeton Foundation and the United Nations Office for Partnerships, will host a groundbreaking incentive2innovate conference (i2i) for senior-level executives, June 8-9 at the United Nations in New York. i2i will provide an intimate forum for attendees to collaborate with extraordinary business leaders on initiatives to make an immediate impact on innovation, operations and revenue generation within their respective organizations. Innovators will include Dr. Peter H. Diamandis, chairman and CEO, The X PRIZE Foundation; Arianna Huffington, co-founder and editor-in-chief, Huffington Post; Don Tapscott, author of Wikinomics: How Mass Collaboration Changes Everything and Grown Up Digital: How the Net Generation is Changing the World; and many more.

The i2i experience goes beyond simply listening to speakers. Through a highly collaborative format, i2i will connect attendees with peers, business leaders and industry experts to brainstorm relevant solutions for their companies’ most pressing business issues. i2i will provide attendees with the following:

  • Practical methods to create a culture of innovation through collaboration
  • Concrete ways to leverage limited resources to innovate through incentivized competition
  • Proven applications that will help drive innovation and improve bottom-line performance

Conference attendees will also have the opportunity to engage with Thomas Kalil, deputy director, Office of Science and Technology Policy, Obama Administration; Reid Hoffman, chairman and CEO, LinkedIn; Dean Kamen, founder, FIRST, and president, DEKA Research and Development Corporation; Dwayne Spradlin, president and CEO, Innocentive; Matthew Bishop, chief business writer/US business editor, The Economist; Paul Jansen, partner at McKinsey and Company; J. Craig Venter, Ph.D., founder and president of J. Craig Venture Institute and J. Craig Venter Science Foundation; and Charles L. Harper, Jr. D.Phil, senior vice president and chief strategist of John Templeton Foundation, among many others.

i2i will feature working sessions and keynote addresses focused on the following topics:

  • Open Collaboration: Leverage investments by recruiting the world’s best talent to solve challenges
  • Incentivized Competition: Design incentive prizes and only pay for the results you need
  • Health Care: Use open collaboration and incentivized competition to drive healthcare innovations for individual companies and the industry overall
  • Energy and Environment: Learn from the leaders who are using open-source innovation and competition to lead the green revolution
  • Power of Politics and Prizes: Understand the government’s current and future use of prizes as a tool to solve major problems within our communities and across borders
  • Global Development: Collaborate on a new approach to create sustainable economies for the developing world
  • Open Innovation Culture: Radically change corporate culture; embed innovation in your daily operations and unlock your employees’ hidden talent

“We’ve assembled a dynamic group of visionaries for i2i who are enacting change and making a positive impact on business that will drive this economy out of the recession and into the future,” said Dr. Diamandis. “With the support of our partners, the Foundation has pioneered the concept of innovation through incentivized competition and open collaboration. During i2i, we will share these tools, and show their potential to create revolutionary solutions and drive sustainable economic growth for attendees’ businesses.”

To register for the conference or to view the complete i2i agenda and innovators’ bios, please visit


About The X PRIZE Foundation

The X PRIZE Foundation is an educational nonprofit prize institute whose mission is to create radical breakthroughs for the benefit of humanity. In 2004, the Foundation captured the world’s attention when the Burt Rutan-led team, backed by Microsoft co-founder Paul Allen, built and flew the world’s first private spaceship to win the $10 million Ansari X PRIZE for suborbital spaceflight. The Foundation has since launched the $10 million Archon X PRIZE for Genomics, the $30 million Google Lunar X PRIZE and the $10 million Progressive Insurance Automotive X PRIZE. The Foundation, with the support of its partner, BT Global Services, is creating prizes in Space and Ocean Exploration, Life Sciences, Energy and Environment, Education and Global Development. The Foundation is widely recognized as the leading model for fostering innovation through competition. For more information, please visit

About BT Global Services

BT is one of the world’s leading providers of communications solutions and services operating in 170 countries. Its principal activities include the provision of networked IT services globally; local, national and international telecommunications services to our customers for use at home, at work and on the move; broadband and internet products and services and converged fixed/mobile products and services. BT consists principally of four lines of business: BT Global Services, Openreach, BT Retail and BT Wholesale. British Telecommunications plc (BT) is a wholly-owned subsidiary of BT Gropu plc and ecompasses virtually all business and assets of BT Group. BT Group plc is liste don the stock exchanges in London and New York. For more information, visit

About The United Nations Office for Partnerships

United Nations Office for Partnerships (UNOP) serves as a gateway for partnership opportunities with the United Nations family. It promotes new collaborations and alliances in furtherance of the Millennium Development Goals (MDGs) and provides support to new initiatives of the Secretary-General. UNOP provides Partnership Advisory Services and Outreach to a variety of entities, as well as managing the United Nations Fund for International Partnerships. UNFIP serves as the interface in the partnership between the UN system and the UN Foundation. UNOP also manages the United Nations Democracy Fund (UNDEF), established by the Secretary- General in July 2005, to support democratization around the world. UNOP is headed by the Executive Director Amir Dossal. For more information about the UN Millennium Development Goals, please visit

About The John Templeton Foundation

The John Templeton Foundation serves as a philanthropic catalyst for research on what scientists and philosophers call the Big Questions. It supports innovative work at the world's top universities in such fields as theoretical physics, cosmology, evolutionary biology, cognitive science, and social science relating to love, forgiveness, creativity, purpose, and the nature and origin of religious belief. The Foundation also seeks to stimulate new thinking about wealth creation in the developing world, character education in schools and universities, and programs for cultivating the talents of gifted children. For more information, please visit

Wednesday, May 20, 2009

New Healthcare X PRIZE Video

The absolute potential to transform the way we provide services and improve patient care

The X PRIZE Foundation role in operating large incentive prizes means that there are significant internal creative resources for creating rich media content. Along with our partner, BT Global Services, we have just released the latest installment of the “Innovation in Action” video podcast series called "XPlorating Healthcare".

The video highlights how the Foundation and BT Global Services are pushing the boundaries of innovation within Healthcare & Life Sciences. The video showcases the design of the new Healthcare X PRIZE (in partnership with WellPoint, Inc. and the WellPoint Foundation) and how BT Health has been helping the National Health Service in England deliver better community care with the Mobile Health Worker Solution.

In addition, X PRIZE Foundation is sponsoring the upcoming incentive2innovate (i2i) conference in New York City on June 8-9. Healthcare will again be prominently featured by demonstrating how companies, communities, and governments can use incentive prizes and open collaboration in the healthcare industry ( or see below for details). Samuel R. Nussbaum, M.D., EVP, Clinical Health Policy and CMO, WellPoint Inc. and Yury Rozenman, head of strategy and marketing, Healthcare & Life Sciences, BT are scheduled to lead the group discussion with our X PRIZE board members Dean Kamen and J. Craig Venter.

Monday, May 18, 2009

Role of the EMR in Managing Community Health

Is a community wide EMR essential to actually help optimize population health?

Our conversations continue with several community groups who are interested in organizing themselves to compete in the Healthcare X PRIZE. This has certainly led to some promising developments in our prize development process. One of the interesting items of internal debate has been the value of electronic health records, whether or not they should be required as part of the rule set for teams.

It’s still an open item, although we are leaning towards being less prescriptive as opposed to more. However, many of the ways we anticipate teams will interact with participants requires some of the data and functional capabilities of an EMR. Researching how others have addressed this issue led me back to the New Ulm Project, where the community wide implementation of an EMR was a primary reason for New Ulm being selected as the test site.

Comments from their report - "The Heart of New Ulm: A Vision for the Future":
Centralized Healthcare including an Automated Medical Record

Prior community CAD interventions have not had the luxury of centralized healthcare that includes automated medical records. Within the city of New Ulm, care is provided by a single health system, and currently, 16,470 (96% of the population) patients have patient records in the automated medical record. An integrated care delivery system has the capacity to systematically identify individuals at risk for CAD and those with active disease, create targeted interventions (e.g., clinic-, phone-, web-, or mail-based), and tailor treatments to the individual. It also serves as a communication vehicle between all members of the care team, which is vital for coordinated care. The automated medical record provides the needed information linkages and is designed as a closedloop system that allows for both input and feedback. Based on medical record data, interventions can be designed to keep healthy people healthy (e.g., health promotion programs), offer risk reduction health behavior change programs to individuals at moderate risk (e.g., weight management or stress management programs), create algorithms to identify individuals at high risk who may benefit from more intensive interventions (e.g., calcium scoring), and more effectively manage individuals with active disease who are not achieving optimal care goals (e.g., clinical interventions and disease management programs).

Value of Automated Medical Record in Community Health Initiative

While use of health promotion, primary prevention, and secondary prevention strategies in community-wide interventions is not new, what is new is the use of centralized care—especially the automated medical record—to target and tailor interventions to achieve optimal outcomes. The automated medical record provides unique opportunities to help individuals achieve optimal health and care through individual and system support, for example, at the:

Individual level — Individuals can receive feedback reports based on data entered into the medical record to learn about their risks for having a myocardial infarction, how well they are doing at managing their risks (e.g., blood pressure is normal or high), and what programs are available to them to help them improve their risk profile and stay healthy.

Provider level — Providers can receive feedback reports based on data entered into the medical record on the number of patients achieving optimal care targets (e.g., LDL-C and blood pressure in recommended ranges based on risk profile), patients’ refill patterns for prescribed medications (i.e., medication compliance), and health behaviors (e.g., tobacco use). All of this information can be utilized to provide quality care to patients and provide advice and appropriate referrals to patients during encounters that offer the “teachable moment.”

Clinic and care system level — At the systems level, reports can be generated to assess achievement of primary and secondary prevention goals, implement systems-level interventions (e.g., disease management or medication-compliance programs), and even generate employer-specific aggregate reports that could be used to offer and implement worksite-based health promotion, disease prevention, and disease self-management programs.
Seems like a compelling endorsement of a system wide EMR as a foundation for transformation. Other large systemic systems have all implemented EMR’s as part of their transformational strategy (Kaiser, VA, Intermountain, etc). Despite this evidence, we still have abysmal adoption rates and systems that are missing core functionality and feature sets that would allow greater proliferation. While we may not make this an explicit requirement, it seems like most teams will need many of the capabilities found in current EMR’s but may need to develop enhanced population management tools.

We look forward to getting additional input on this particular design element.

Wednesday, May 6, 2009

Health Value Messaging - The Single Sentence Statement

The focus on health care value is a powerful organizing principle, but communicating this concept in an elevator pitch is challenging

The Healthcare X PRIZE continues to build momentum as we receive a steady stream of inquiries regarding this $10MM competition. While many of the inquiries are regarding timing, application, and registration process, we have also been receiving a number of high quality request for information from technology companies, academic organizations, and communities who are interested to understand how they can participate. In fact, the most passionate inquiries seem to come from community based organizations who have a clear vision of how the community can be architected to function as a single entity that maximizes health value. It is great to see how the X PRIZE can inspire this type of thinking.

However, we have received some feedback that the health value story is a little difficult to grasp. Admittedly, it feels like it takes two or three sentences to explain what we mean by health value, how community health is related to that, and how individuals are connected to and influence the community. This is in contrast to the single statements of other prizes that immediately evoke a powerful and clear notions of what is the prize is about. As an example of the single sentence statements that create a singular focus:
  • Ansari X PRIZE: "100Km, twice in two weeks, with three person payload"
  • Archon Genomics X PRIZE: "100 genomes in 10 days"
  • Google Lunar X PRIZE: "Land a rover, motate 500m, send back high definition images"
These are all clear and compelling; single statements that can be pitched in an elevator and understood by a child. They also represent significant scientific and technical breakthroughs that are understood and can be systematically worked through.

However, the Healthcare X PRIZE is a different animal. It is actually a prize designed to change a system (and a very complex one at that). With approximately 20% of the GDP involved in the industry we are trying to reform, it is worthy of an X PRIZE type effort although many believe we are pushing the boundaries of the X PRIZE framework in designing a systemic prize versus something more confined, constrained, and ultimately more conservative.

But it is a challenge we are willing to take on. We believe that health value is the right organizing principle, but perhaps we communicate the same message in a different way that drives home the point in a more singular fashion. Perhaps we need to focus more on the "healthy community" aspect (using the health value measurement framework), ala the huge success we are seeing with initiatives like Shape Up Rhode Island. Perhaps we need to shift to focus on a leading indicator condition like the Heart of New Ulm (which to impact would still require the systemic changes we seek). Or, perhaps, we just need to keep preaching the Health Value story with direct outreach, clear examples, and compelling case studies.

We look forward to your feedback as we continue to evolve the messaging of the Healthcare X PRIZE. Given the potential impact of the prize to demonstrate that radical transformations within health care are possible, we look forward to developing the most compelling single sentence statement.

Would love to get your feedback.

Friday, May 1, 2009

Health Innovators Series: Esther Dyson on improving "Health"

Esther Dyson shares her perspectives on health, health care, and how the X PRIZE can be an aspiration framework to inject innovation into the health care reform conversation.

As part of the development of the X PRIZE, we have had fascinating conversations with innovators throughout the health industry and health care system. One of the more avante guard thinkers in health (or anywhere for that matter) is the diminutive but indomitable Esther Dyson. Esther is an original, beginning with her industry changing Release 1.0, to her online presence with Release 2.0, to her ongoing investment, commentary, and thought leadership in all things innovative (including her recent stint in Russia training as a cosmonaut). She has recently turned her attention to health, making investments in several Health 2.0 companies like 23andMe, OrganizedWisdom, and ReliefInSite among others. We caught up with Esther for a few minutes early this year as part of the Healthcare X PRIZE development process.

You have such an interesting background, what are you doing now?
I’m just completed a course of study to become a cosmonaut. Its been an absolutely crazy experience but a fulfillment of a lifetime dream. Now that I am back, I am continuing to stay active in the investment space as well as looking at new and interesting trends.

What is your interest in healthcare?
I have been an investor in several innovative health startups - 23andMe, Organized Wisdom, Relief in Site - and I am fascinated by the tragedy of our current health care system. For a profession where the stakes are literally life and death, I am shocked by the lack of safety fanatacism we see. It is tragic to hear how often doctors don’t wash their hands, operate on the wrong body part, or have no safety systems or feedback loops to ensure that patients remain safe in their care. It feels like health care industry has been allowed to operate in this obscure way where people don’t know what they are getting, don’t know how much they are paying, have no outcomes data to tell them how good services are, and as a result there can be no competition stimulus to help improve. I find it a fascinating area to which we can apply many of the lessons we have already learned elsewhere.

What are the lessons learned form other industries that you think apply to healthcare?
A good example for the safety concept I mentioned above is the airline industry. You certainly see a safety fanaticism there (now if we can just get them to have an “on time” fanaticism!). It began with some efforts to regulate the industry in terms of who can and should be flying. It then spread to the systemization of safety, checklists, procedures that were followed every time to remove human errors. Another would be the impact of pricing transparency and how consumers value the service experience. Transparency engines like Travelocity and Expedia have really yielded some competitive rates for travelers. But as the prices have come down, there began to be too much focus on just low price and the flight experience was lost (safe and cheap but unpleasant). They forget that the consumers are willing to pay for experience as well. This is why companies like Jet Blue or Virgin Airlines can be successful because the “experience” they provide is worth a few extra bucks to the people who choose to fly them.

How do you see competition / pricing transparency affecting health care?
The health care sector has almost no true price competition. No one - including hospitals, providers, or patients - seem to have any idea how much things costs. Without this information readily available to all you are never going to be able to have a true marketplace. The type of competition we see now is actually not healthy for the industry - we see the medical arms race in term of all hospitals in a town obtaining the latest MRI scanner, robotic surgery unit, or other technology de jour to be able to compete in the medical arms race. This just translates to more expensive and wasteful care for all the people in that community. We shouldn’t be competing on these things but rather on how successful we are at improving health (not just health care).

Speaking of transparency, can you share your thoughts regarding patients controlling their data?
I am a big believer of what can happen when people have access to the data - particularly their own data. Whether that is in the form of an electronic health record, their own genomic data, or other related information they should absolutely have access to it. We can see the type of good that can come from this in the examples of ePatient Dave and others who are driving changes at multi-billion dollar companies who adjust how they deliver their services based on activated patients who are demanding more and better services.

It also goes to another point that I feel is relevant. People will change their behavior when it is in their self interest to do so. There appears to be an unwarranted “delicacy” about how people use and share their health information. There remains alot of areas where we just don’t talk enough - medical errors, deaths from cancers, and woman’s health issues - we need to know how our bodies work and it should not be impolite to inquire. Without this information readily accessible in a format that I want to view it in, we are not going to see the types of dramatic health improvements that I think are possible.

Where do you think we can see the biggest gains in health improvement?
To be honest, we need to help change peoples behaviors. I think that we could do the greatest good for the greatest number through the elimination of cigarettes, by change our current western diets, dramatically increasing our exercise efforts, and several other relatively straightforward and common sense approaches. The challenge with simplicity of the goal is the complexity of the humans who actually have to do something about it by changing the choices they are making. This is where the rubber hits the road and I am hopeful to see additional innovation that is easy to use, engaging, and fits into the pattern of my everyday life.

You are familiar with the X PRIZE Foundation from the Ansari X PRIZE. What outcome should the Healthcare X PRIZE be seeking to achieve?
I don’t think there can nor probably should be a single health goal. Four to five overarching competitions that tie together is probably a more realistic goal that would help you achieve the dramatic and transformational impact that is part of the X PRIZE mission. Another way to think about this would be to have multiple prizes as part of a single competition - awarding a different prize to the team that creates the most healthy living. Or perhaps, a sub prize to someone who dramatically improves a single disease state, or someone who reforms the payment system in the most effective way, etc

In terms of healthcare, I think we need to take a “systems” approach and figure how we can systematically get more individuals involved with managing their own health as well as become better users of the health care system. We also need to have people become focused on health, not just health care, and seek to improve living spaces, lifestyles, and natural balance. What is missing in all of this is the actual consumer engagement - having people become accountable for the choices they are making.

What type of financial incentives are required to move us toward a system that you are suggesting?
We need to have an insurance system that pays on delta’s rather than on costs. They need to share responsibility for improving my health and get rewarded for doing so as well. This might include a much more analytical framework in place so that we can know how much each person or groups of people are costing and consider differential payments for individuals who are conscientiously making healthier behavioral choices. This obviously highlights how information intense health is, and should be for that matter; we need to know the cost/benefit of each intervention and of each behavioral choice we so can get to an outcomes based premium concept.

Who will take on that role of the health vitality organization? Is that insurance companies or some other organization?
Our current construct for insurance is a joke. Our employer based system creates all kinds of distortions which ultimately require the government to be involved. Health should reasonably considered a societal good, and I believe it is appropriate that as a country we have determined that we are not going to charge the sickest among us what they truly cost the system. Essentially, what our “insurance” system really does is to attempt to spread the risk around. This isn’t really insurance but rather a redistribution of cost. I think if we begin to pay for things in a different way, including adopting a “true” insurance framework which would include more costs born by those using the system (with appropriate subsidies in place based on income), we can begin moving in the right direction.

How would you design a competition to improve the healthcare system?
Good question! How should we define the scope of “healthcare”? What models of care offers the most potential for improving the cost/quality tradeoffs (e.g., provider type, lifestyle, public health)? What elements of delivering care have the most potential (e.g., access, coverage, transparency)?

The very question strikes at something that I feel passionate about - we need to eliminate healthcare and improve health. I would be thinking about ways to dramatically reduce costs in the system while dramatically raising the bar to improve outcomes. I think I would approach this very commercially minded - what commercial outfit can be built that would deliver the type of outputs you are trying to achieve as part of an “optimal health paradigm”.
I would love to see that within 3 years you’d have a population of 1M people who have demonstrated improvement in predicted health outcome. The competition should require that teams have to change the real behavior of real people. I realize that the judging of this is going to be somewhat difficult, but there are many people and teams out there who have a jump on this and are doing real, great work. I would learn from the best organizations out there and create a competition that can replicate that success on a large scale while delivering the outcomes you seek.

Who else should we be speaking to?
One of the people I truly have respect for is Paul O’Neill and what he did at Alcoa. They dramatically reduced the number of hospitalizations they were experiencing as a company which dramatically reduced their costs. They also introduced several novel programs that made a real difference in how their employees thought about health care, how they used health services, and ultimately how healthy they were as a company. Pretty fascinating.