Blockchain in healthcare: use cases for your practice

Blockchain in healthcare: use cases for your practice

February 6, 2020

Nadejda Alkhaldi

Blockchain is a relatively new technology, but together with other technologies such as big data analytics, IoMT, and 5G, it can help healthcare improve its traditional approach to health data handling and supply chain transparency.

The statistics on blockchain in healthcare predict a bright future for this technology. According to Research and Markets, the global blockchain technology market in the healthcare industry is expected to cross $500 million by 2022, growing at a CAGR of 61.4% between 2018 and 2022. At the same time, IDC suggests that 55% of all healthcare applications will have employed blockchain for commercial purposes by 2025.

As blockchain is gaining popularity, healthcare organizations are partnering with blockchain consultants to facilitate the adoption of this technology in healthcare projects.

Blockchain adoption in healthcare

The potential of blockchain in healthcare

Nowadays, the healthcare field is facing several challenges. One example is human error, which has been the third leading cause of death in the US according to CNBC. Other challenges include security of patient health records, lack of transparency in the pharmaceutical supply chain, lack of interoperability between databases holding patient health records, and dispersity of healthcare-related information, be it patients’ medical history or medical staff credentials. The current situation poses with interoperability in healthcare also poses difficulties for sharing and accessing health data timely. 

Blockchain technology can be the answer to these healthcare challenges. It will largely improve and potentially revolutionize the way health data is handled and used by both patients and doctors.

The graph below explains how a typical blockchain system operates, creating immutable and permanent records.

Overview of how a blockchain system operates

Due to the inherent security and decentralization, the benefits of blockchain in healthcare are numerous. It improves the safety of patients’ electronic medical records, facilitates health data monetization, enforces interoperability between healthcare organizations, and helps fighting counterfeit drugs.

Digital agreements enabled by smart contracts represent one of the most powerful uses of blockchain in many domains, healthcare included.

Blockchain in healthcare: smart contracts

Smart contract platforms can reduce costs by eliminating intermediaries from the payment process. A smart contract is a piece of code (a set of if-then-else statements) that is deployed on a blockchain and gets executed automatically when certain conditions are met. Smart contracts trigger transaction processing without requiring an intermediary for initiating this workflow.

Particularly, smart contracts can deliver notable results in the following areas.

Health insurance

Smart contracts can largely improve the traditional insurance system and eliminate all unnecessary intermediaries. If a patient buys their medical insurance policy using smart contracts, the policy details will be stored in the patient’s profile on the blockchain and be less prone to hacking than when stored in a traditional database.

This will also eliminate the need to file time-consuming insurance claims. When a patient undergoes a procedure covered by insurance, the smart contract will be triggered automatically and the money will be transferred from the payer to the hospital.

The insurance model with intermediaries vs the blockchain model with smart contracts

Telemedicine and telehealth solutions in general are gaining popularity in healthcare. It allows physicians to reach patients using digital devices, such as smartphones, and the internet of medical things. Using telemedicine, physicians can stream and process real-time data from patients’ sensors. While this data offers insights on patients’ conditions, it also opens up opportunities for hackers.

Smart contracts can be implemented on a privately owned blockchain to aggregate, analyze and share data in a secure and reliable fashion.

Health records interoperability

Smart contracts facilitate storing health records on a digital ledger. With this setup, the patient can easily change doctors and hospitals without the need to transfer their health records and fill in numerous forms to recover their data, which opens the door for errors and compromises record safety.

With smart contracts, only access permissions change. Ideally, the patient should be able to walk into any clinic of choice (even in a foreign country) and grant that clinic access to her medical records by entering her private key. This is blockchain interoperability in action, and while it’s still a work in progress, many companies contribute to pushing this topic to the forefront of innovations right now.

Blockchain applications in healthcare industry

Drug traceability

Pharma interestingly is one of the sectors that is most advanced in the US when it comes to integrating IoT networks with blockchain.

Avivah Litan

Avivah Litan

Vice President and Distinguished Analyst at Gartner Research

This advancement is a part of pharmacy automation that is called to solve the counterfeit drug problem and enforce the Drug Quality Security Act, which tightens tracking and security control around pharmaceutics.

Counterfeit drugs are a considerable problem in the pharmaceutical industry. They cause health complications and can even result in death. Additionally, they account for a considerable financial loss in the pharmaceutical industry. According to The Financial Times, between 10% and 30% of all drugs circulating on the market are fake.

Counterfeit drugs also affect employment in the pharmaceutical sector. As reported by Eurostat, it is estimated that 37,700 jobs are lost in the EU pharmaceutics sector because drug manufacturers are forced to employ less people than they would in the absence of counterfeit drugs.

Blockchain is a reliable solution to ensure drug authenticity, as it permits tracking every drug to its very origins. Blockchain can be used to encapsulate information about the drug at every stage of its lifecycle (such as production, distribution, etc.). Every block within the blockchain containing drug information will have a hash linked to another block, and every block will come with a time stamp that cannot be altered.

In such a setup, circulating a fake drug will be next to impossible. Incrementation of transactions in the blockchain will be visible to all authorized parties, and a medicine’s movement from one party to another will be trackable in real time. Medicine consumers will also be able to verify the authenticity of purchased products by scanning the QR code and looking up the information about the manufacturer and other relevant supply chain participants.

Every member of such blockchains has particular rights: manufacturers register their products, pharmacies choose among available suppliers, and so on. Any pharmaceutical company willing to register its product or purchase a product using a blockchain will need to prove its trustworthiness to the controlling party.

Blockchain drug traceability

As a result, blockchain implementation enables drug traceability and transparency, which in turn enhances accountability. Additionally, it offers an efficient recall system, allowing to identify the exact location of a particular drug.

French pharmaceutical company Blockpharma offers a blockchain solution for drug traceability based on machine learning. The company’s app enables patients to check if their purchased medicine is falsified by tracking the supply chain and verifying all points of shipment. Blockpharma claims that its solution helps to weed out 15% of all fake medicine in the world.

Facilitating clinical trials and research

Blockchain can help to address the issue of fraud in clinical trials. Fraud constitutes modifying information to conceal the actual effect of trialed drugs or any other treatments.

To ensure security and transparency of clinical trials, researchers can rely on blockchain. There, all documents created for the purpose of clinical trials can be time-stamped and stored securely. Those documents include project proposals, research design, surveys, blood tests, and informed consent of the participating parties.

Blockchain has many more benefits for clinical trials. It adds credibility to the research performed, as every document on the blockchain becomes verifiable. It also reduces audit costs and eliminates the issues of lost documents or datasets.

One example of using blockchain for clinical research is offered by the US Center for Disease Control and Prevention, which is considering blockchain for disease monitoring. The Center says that blockchain properties such as time stamping, peer-to-peer reporting, and processing capabilities will allow to report disease outbreaks in real time. Studying reported diseases will help scientists in identifying patterns for disease suppression.

Patient data management and sharing

By the end of 2018, the Department of Health and Human Services’ Office has received notifications of over 350 data breaches, resulting in an exposure of 13,020,821 healthcare records.

HIPAA has strict regulations around the privacy of patient records. At the same time, those records cannot be isolated as there are several parties other than the patient and their physician who may need access for the sake of a patient’s wellbeing. At the same time, managing patient data using a traditional approach has been a complicated task, since this data is distributed over different healthcare databases that may be neither consistent nor interoperable.

Blockchain resolves those issues by offering a unified platform for storing and managing all relevant data in one location, while maintaining security and access control. Pieces of patient data are stored as blockchain blocks that are identifiable through the patient’s unique ID. This arrangement also allows sharing health information (blocks) without revealing the ID if the patient wishes to remain anonymous, for example, when participating in a clinical research.

With blockchain, it is possible for patients to allow their trusted care provider access to their medical information in an instant. This is particularly useful when dealing with elderly or unconscious patients. For example, the UK-based company Medicalchain allows patients to authorize access to their health information by scanning a censored bracelet using a smartphone.

Blockchain for electronic health records

Blockchain is also a reliable solution for population health data management. With the traditional system, information about every patient is distributed over multiple systems, which are not interoperable. This makes aggregating health data for a particular population cluster a challenging task. Blockchain offers a unified, secure platform for people to participate in population health studies as well as monetize the outcome of these studies. For example, the BaaS platform by AWS provides a robust and affordable solution for healthcare institutions that want to streamline patient records management.

Cryptocurrency payments

There are blockchain use cases in healthcare related to payment, too. For example, blockchain makes it possible to receive medical services and pay for them with cryptocurrency. One example is Solve.Care, a blockchain healthcare startup that partnered with Uber Health to facilitate patient transportation. Uber’s transportation services will be integrated into Solve.Care’s app, which will enable patients to schedule an Uber Health HIPAA-compliant ride and pay for the services using Care.Wallet.

Blockchain can facilitate health data monetization for people who are willing to share their genomic data for research purposes in return for a financial reward. Blockchain can then encapsulate their health information and facilitate transactions via cryptocurrency payments.

Micropayment is another concept enabled via blockchain. Micropayments are new value-based models in healthcare which reward patients if they follow their doctors’ instructions and stick to the prescribed lifestyles. Operating on a certain blockchain, this micropayment model will record every detail about the patient’s activities relevant to the treatment, review and track them back to the patient.

Medical staff credentialing

Verifying credentials is an important part of the hiring process. However, it can be a time-consuming and costly effort, mostly conducted by phone or mail. Blockchain is suited to replace this traditional process because blockchain records are verifiable, can be incrementally updated, and allowing full or limited permissions to view and update the entries.

The idea of using blockchain for medical staff credentialing is that all the relevant credentials can be inputted to a distributed ledger (a database) and accessed by those parties who entered a particular blockchain credentialing agreement. In this manner, when there is the need to access a candidate’s credentials (for example, over the period of 10 years), authorized parties can do it instantly within a single database without having to contact every institution where the credentials were obtained.

Hashed Health is the company that developed a blockchain-based credential verification system allowing physicians to prove that they are licensed professionals. This system offers an exchange platform for healthcare organizations that can access credentials of nurses, doctors, and other types of employees within the healthcare sector, as well as define particular rules and validation checks of credentials. Together with credentials, the blockchain stores professionals’ permissions to practice at particular levels and locations.

Has your practice come up with blockchain healthcare use cases yet?

There are many high-potential blockchain healthcare use cases that are either in their pilot stages or launched to the market successfully. However, before jumping on board, it is important to understand the needs of your organization. Here are some indicators that you might need blockchain:

  • Multiple parties need to work on the same data
  • The level of trust among those parties is low
  • For this reason, intermediaries are required to mitigate the lack of trust
  • If transaction processing times get reduced, all the parties would benefit financially

Finally, note that if you decide to incorporate blockchain into your practice, some business processes will have to be modified to operate well on blockchain.

Blockchain is going to enable us to connect and pass information in a more secure way than we do today, but if [we] don't have business process change behind it, it's not going to work.

Heather Zenk

Heather Zenk

Senior Vice President of Secure Supply Chain and Replenishment Operations at AmerisourceBergen