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October 16, 2008 10:26 PM

Five Reasons WellPoint's $10M Healthcare Competition Won't Work

By
David Hamilton
(MoneyWatch)  So now the health-insurance provider WellPoint has put up $10 million for a new X Prize -- one that promises the money to anyone who can figure out a new way to fix the healthcare system. The X Prize Foundation is the same organization that created similar prize competitions in order to encourage entrepreneurs to build a private manned spacecraft (which one did, sort of), vastly speed up genome sequencing (not yet), land a robot on the Moon (ditto), and build a car that gets 100 miles to the gallon (ditto).

As you'd expect, the company and the foundation have enlisted an array of luminaries who rave about the "profound" "innovation" involved in setting up a big prize for new healthcare ideas. The only problem is that the odds of this sort of contest really turning up useful reforms are virtually nonexistent. Here are five reasons:

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© 2008 CBS Interactive Inc.. All Rights Reserved.

  • David Hamilton is the assistant managing editor of CNET News. He has been writing and editing business and tech coverage for about two decades -- the majority of that at the Wall Street Journal in both Tokyo and San Francisco.

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