The age of privately funded space flight began five years ago, as enthusiasts competed for the $10 million X Prize.  The winning team was headed by Burt Rutan, an aerospace pioneer in California.  Since then, the foundation that sponsors the X Prize has offered other incentives for technical innovation.  The latest is the $10 million Healthcare X Prize.

Peter Diamandis, the man behind the X Prize, says the idea is to harness the creativity of private entrepreneurs and leverage resources through competition.  

He says some of the biggest technical breakthroughs come from ordinary people, not from so-called experts.

"I define experts many times as people who can tell you exactly how something can't happen," said Peter Diamandis. "And when you're looking for a breakthrough, sometimes you need to allow people from outside the field to come in."

In 1996, Diamandis challenged aerospace innovators to put a human into space in a privately funded project.  The Ansari X Prize was funded in part by the family of Iranian American entrepreneur Anousheh Ansari.  More than two dozen teams together spent $100 million to compete for the $10 million purse.  The successful flights of SpaceShipOne, a craft designed and launched by a team headed by Burt Rutan, led to a fledgling industry in private space flight, which is expected to take tourists into space in a few years.

The accomplishment got the attention of other innovators in the high tech world and Diamandis says the idea of the incentive prize expanded.

"It was so successful that afterwards, Larry Page, one of the cofounders of Google, joined our board [of directors] and said: 'Let's take X Prize and make it a world-class prize organization and create prizes in other key areas.  Where are there market failures?  Where are things stuck that we need a prize to be disruptive and reinvent something?,'" said Diamandis.

The X Prize Foundation has teamed up with private partners to finance competitions in new areas.  One aims for a breakthrough in human genetic research.  Another challenges teams to send a robotic rover to the moon.  A third seeks to develop a super fuel-efficient vehicle.  The latest X Prize, unveiled last month, is a $10 million challenge to design a community health care system.  

The partner in the challenge is WellPoint, the largest U.S. health insurance group.  Samuel Nussbaum is WellPoint's Chief Medical Officer and Executive Vice President.  He says the winning entry should tackle traditional issues such as preventing disease and encouraging healthy lifestyles.  It should also integrate new technologies, offering ways to coordinate medical care among physicians and hospitals, in schools and in the workplace.  The entries will be narrowed to five finalists and each will be tested in a WellPoint service area in the United States in a three-year community trial.

Dr. Nussbaum says that future medical care will be individualized to match a patient's genetic profile.  He adds that the prize rules, which are now being finalized, must take account of the rapid progress being made in medical and information technologies.

"It will likely not slow down, but accelerate," said Samuel Nussbaum. "So we have to actually design the prize and design a model that can work today, that can work five years from now and, most importantly, can work into the future as medicine and science and engineering, biology and informatics all really merge and give us a new infrastructure for care."

The Healthcare X Prize is open to private teams around the world.  Peter Diamandis says some may be based at universities or private companies.  He says they can forge partnerships with community organizations and health care providers.  After U.S trials, an independent panel of judges will determine the winning plan, using such factors such as improved community health, reduction in sick days, lower rates of hospitalization and affordability.