Self-Aligning Incentive Structure
Results-Based Compensation Model
PRISM's business model represents a fundamental departure from traditional healthcare technology pricing, creating a system where payment occurs only after demonstrated success in improving patient outcomes. This results-based approach means PRISM generates zero revenue from suggestions that don't lead to beneficial early detection. Every dollar PRISM earns represents documented prevention of future complications through timely screening and intervention.
The mechanism works through careful tracking of outcomes. When PRISM suggests a screening test and that test leads to early diagnosis followed by successful treatment, the system has created measurable value. The insurance company avoided years of escalating treatments, emergency visits, and eventual complications. The patient avoided suffering and disability. The healthcare system avoided resource-intensive late-stage care. Only when this value creation is documented does PRISM receive compensation.
This model creates powerful natural incentives for accuracy and restraint. Because PRISM commits to ensuring patient cost coverage for suggested screening tests, the system is naturally aligned to only recommend testing when patterns strongly indicate potential benefit. Every suggestion represents PRISM's confidence that the screening will lead to better patient outcomes. The system cannot profit from excessive testing because unnecessary tests don't lead to early treatment of actual conditions, and PRISM bears responsibility for ensuring those tests don't create patient financial burden.
The results-based model also aligns PRISM's interests with long-term patient outcomes rather than short-term transaction volumes. Traditional fee-for-service models in healthcare technology create incentives to maximize utilization regardless of benefit. PRISM's model creates incentives to maximize beneficial outcomes while minimizing unnecessary interventions. The system succeeds not by generating activity but by generating value.
Pre-Agreed Percentage of Savings
Before implementation begins, PRISM and insurance companies establish specific agreements about compensation for successful early detection. These agreements define exact percentages of projected savings for different conditions based on well-documented differences between early and late treatment costs. The percentages are pre-negotiated and fixed, creating predictable economics that both parties can model and plan around.
The calculation methodology relies on established medical literature and actuarial data about treatment cost differences. For conditions like primary aldosteronism, early detection can avoid years of cardiovascular complications, emergency visits, and eventual organ damage. The agreement specifies what percentage of this projected saving PRISM receives when early detection occurs. Different conditions have different cost-benefit profiles based on the severity of preventable complications and the costs of early versus late intervention. Each condition has its own economics based on the magnitude of prevented complications and the complexity of pattern recognition required.
These pre-agreed percentages create transparency and predictability. Insurance companies know exactly what they'll pay for each successful early detection. They can model the financial impact based on their population size and disease prevalence. They can verify that even after paying PRISM, they achieve substantial net savings. This predictability enables confident investment in the program knowing the return on investment is guaranteed by the payment structure itself.
The percentage agreements also reflect the relative difficulty and value of different pattern recognitions. Conditions with subtle patterns that are frequently missed might warrant higher percentages. Conditions with obvious patterns but high complication costs might have lower percentages. This flexibility allows the model to accommodate the diverse economic realities of different medical conditions while maintaining the core principle of payment for demonstrated value.
PRISM-Specific ICD Tracking Codes
The key to PRISM's outcome tracking lies in specialized ICD modifier codes that get appended to standard diagnostic test orders when they result from PRISM suggestions. These tracking codes create an auditable trail from pattern recognition through screening to outcome without compromising patient privacy or requiring new billing infrastructure.
When a physician orders a test based on a PRISM suggestion, they include a specific modifier code that identifies this as a PRISM-prompted screening. This code serves a critical dual purpose: it enables outcome tracking for the results-based payment model, and it ensures the patient's out-of-pocket expenses for that test will be covered through PRISM's agreements with the insurance company. This code flows through the standard billing system alongside regular diagnostic and procedure codes. When that same patient later shows treatment codes for the condition the screening was meant to detect, the connection becomes clear: PRISM's suggestion led to successful early detection.
The tracking codes serve multiple purposes beyond payment triggering. They enable continuous quality improvement by identifying which patterns successfully predict beneficial screening opportunities. They provide feedback for model retraining, with successful suggestions becoming new GOOD examples and unsuccessful ones becoming NOPE examples. They create accountability and transparency, allowing both PRISM and insurance companies to monitor system performance objectively.
This tracking mechanism operates entirely within existing billing workflows. Physicians already use modifier codes for various purposes. Billing systems already process and store these codes. Claims databases already maintain the longitudinal records needed to connect screening tests with subsequent treatments. PRISM's innovation lies not in creating new infrastructure but in using existing infrastructure in a novel way to enable outcome-based compensation.
Patient Cost Coverage Goals
A fundamental principle of PRISM's implementation involves ensuring that patients face no financial barriers to recommended screening. The system's effectiveness depends on suggested tests actually being performed, which requires removing cost obstacles that might prevent patients from following through with screening recommendations. PRISM and insurance companies are exploring various mechanisms to achieve this goal.
One approach involves classifying PRISM-suggested screening as preventive care, which many insurance plans already cover without patient cost-sharing. Another involves specific waiver provisions for copays and deductibles when tests include PRISM tracking codes. Some implementations might use supplemental coverage models where the cost savings from early detection fund a pool that covers patient screening costs. The exact mechanism matters less than the outcome: patients shouldn't bear financial burden for tests that could identify serious conditions early.
Removing financial barriers to screening particularly matters for populations where even modest copayments might prevent follow-through. PRISM's commitment to ensuring cost coverage reflects recognition that beneficial screening opportunities should be accessible based on medical need rather than financial means. When the system identifies patterns suggesting screening would be valuable, ability to pay shouldn't determine whether that screening occurs.
This commitment to patient cost coverage reflects both ethical and practical considerations. Ethically, patients shouldn't pay out-of-pocket for screening that primarily benefits the insurance company through reduced future costs. Practically, cost barriers reduce screening completion rates, diminishing the system's effectiveness. Every patient who skips recommended screening due to cost represents a missed opportunity for early detection and a potential future tragedy of late diagnosis.
The patient cost coverage also reinforces PRISM's alignment with patient benefit rather than cost reduction. By ensuring patients don't pay for screening, the system demonstrates that its purpose is improving health outcomes, not shifting costs. This builds trust with both patients and providers, essential for long-term success and adoption.
Why Not Fee-for-Service
Traditional healthcare technology pricing models—per-suggestion fees, monthly subscriptions, per-member charges—would fundamentally misalign PRISM's incentives with its intended purpose. These models create revenue through volume rather than value, encouraging systems to maximize output regardless of quality or benefit. PRISM deliberately rejects these approaches in favor of pure outcomes-based compensation.
Consider what would happen with per-suggestion pricing. PRISM would generate revenue by producing as many screening recommendations as possible, regardless of their likelihood of identifying actual conditions. The system would be incentivized to lower consensus thresholds, reduce quality controls, and flood physicians with marginal suggestions. Physicians would quickly learn to ignore PRISM suggestions as noise, defeating the entire purpose.
Monthly subscription models create different but equally problematic incentives. Revenue would depend on maintaining subscriptions rather than generating value. The focus would shift to user engagement metrics and feature additions rather than pattern recognition quality. Success would be measured by contract renewals rather than early detections. The core mission of identifying beneficial screening opportunities would become secondary to subscription retention.
Per-member per-month pricing, common in healthcare technology, would disconnect revenue from outcomes entirely. PRISM would earn the same amount whether it identified zero screening opportunities or thousands, whether its suggestions proved accurate or useless. This model might seem attractive for predictable revenue, but it eliminates any incentive for continuous improvement or quality maintenance.
The rejection of these traditional models isn't idealistic stubbornness but practical recognition that incentive alignment drives behavior. By tying revenue exclusively to demonstrated successful outcomes, PRISM ensures that every aspect of the system—from pattern recognition to threshold setting to quality control—focuses on the singular goal of beneficial early detection.
Long-term Sustainability
The results-based model creates sustainable economics where all stakeholders benefit continuously from PRISM's operation. This sustainability emerges from the fundamental value creation of early detection rather than zero-sum cost shifting between parties. When PRISM successfully identifies opportunities for early intervention, it creates value that didn't previously exist, enabling all parties to benefit.
For insurance companies, the economics are straightforward. They pay PRISM a percentage of documented savings, ensuring they retain the majority of the financial benefit from early detection. Their net costs decrease even after payment to PRISM. As the system improves through continuous learning, the value creation increases, but their percentage retention ensures they always benefit from improvements. The model scales naturally with success—more early detections generate more savings that fund more compensation.
For PRISM, the model provides revenue growth tied directly to value creation. As pattern recognition improves through model retraining and ensemble expansion, more early detection opportunities are identified. As more insurance companies join the collaborative network, the collective intelligence improves for all participants. Revenue scales with genuine improvement in healthcare outcomes rather than with sales effectiveness or market manipulation.
For patients, the sustainability manifests as continuously improving health outcomes without financial burden. As PRISM identifies more conditions earlier, patients avoid more complications, maintain better quality of life, and face fewer medical crises. The system that helps them requires no direct payment from them, funded entirely through the value it creates by preventing expensive complications.
For the healthcare system broadly, PRISM's model demonstrates that technology can improve outcomes while reducing costs—not through rationing or restriction but through intelligent identification of intervention opportunities. This creates a sustainable template for how AI can be deployed beneficially in healthcare, with aligned incentives ensuring technology serves patient benefit rather than purely financial objectives.
The model's sustainability also comes from its resilience to gaming or manipulation. Because payment requires documented successful early detection—not just testing or diagnosis but actual early treatment preventing complications—there's no way to generate revenue without creating genuine value. This impossibility of gaming ensures the model remains focused on its intended purpose indefinitely.
This document establishes PRISM's business model and incentive alignment. The Constructive-Only Architecture document explains the technical constraints that support this model. The Platform Potential with Constraints document details which conditions and tests this model addresses. The Zero Integration Burden document describes how this model integrates with existing insurance operations without disruption.