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  • Masa ISHII

The Role of Blockchain in Healthcare


The U.S. is poised to spend 20% of its GDP on healthcare. The U.S. currently spends about 18% of GDP on healthcare, and this is poised to reach 20% in the near future. In addition, healthcare continues to be plagued by fast-rising hospital costs, inefficient and bureaucratic business practices such as up-coding, claims-processing and security lapses that leave patient and other data open to ransomware.  These are both very challenging and very expensive problems, that are pushing innovators to develop technologies that provide greater efficiency.

Consequently, healthcare administrators and information offices are looking at new technologies such as distributed databases, on-prem, and hybrid-cloud services, and blockchain to protect patient data, improve patient and physician experience, and manage the outbreak of infectious diseases capable of causing epidemics and, in the extreme, future pandemics. While Blockchain is not meant for storage of large data sets, or as use as an analytics platform, it can be used however, as a tamper-proof public ledger. Blockchain is highly resilient.

What is a Blockchain? A blockchain is essentially a distributed database scattered across the Internet that generates and stores data records, as well as a digital ledger connecting the “blocks” of information that represent how the data in a block is stored, shared, changed, or accessed. All devices on the same blockchain system generate identical blocks when a connected device is involved in any kind of transaction, ensuring reproducibility, scalability, and transparency. With blockchain, if the data stored on a given block is accessed, changed, shared, or otherwise manipulated, a new block is generated to locally record that information. The changes to the block are then disseminated throughout the chain. In this way, changes to data can be easily identified. This approach ensures that the fidelity of data is maintained even when one or more nodes on the blockchain are compromised or drop off the network. Each block is further identified by a unique tag known as a “hash”, generated by a sophisticated algorithm. Blocks are stored together in chronological order and directly referenced via the preceding block’s hashtag. Since changing the data of one block would immediately cause a succeeding block to identify a change in the hashtag, the connected blocks form a “chain” securely wrought in an immutable, reliable, and decentralized manner.

Securing Patient Data Keeping important medical data safe and secure remains one of the most popular applications of blockchain in healthcare. Security has been a major issue in the industry, with numerous data breaches and ransomware attacks.  Between 2009 and 2017, more than 176 million patient records were exposed in data breaches. These caused the loss of credit-card and other banking information (account numbers, etc.), as well as healthcare records and physician notes. The ability of Blockchain to maintain a (theoretically) incorruptible, decentralized and fully transparent log of all events enables it to be used for secure applications of this type. The decentralized access also enables patients, physicians, and providers to share information quickly, accurately, and safely.

Blockchain Can Streamline Care and Prevent Costly Errors Miscommunication and lack of communication (sometimes classified as “unforced medical errors”)  costs the healthcare industry a staggering $11 billion a year. Obtaining, viewing, and updating a patient’s medical history consumes hours of staff time and typically results in less effective patient care. Blockchain-based medical records offers an opportunity to address this problem. Blockchain allows CIOs to rapidly deploy a decentralized, scalable ecosystem of patient information that can be rapidly and effectively referenced by physicians, hospital staff, pharmacists, PTs, OTs, and others. Thus, effective use of a blockchain can lead to faster diagnoses and better and more highly personalized care plans.

Medical Supply Chain Management and Drug Traceability/Safety The primary concerns of the medical supply chain include knowledge of the provenance of the pharmaceutical or biological (and its components and sources), its security and viability (it has not been tapered with or altered in any way), and the source of the supplier. Blockchain can help with all these issues. Once a ledger for a drug is created, it will mark the point of origin (ie. a laboratory). The ledger will then continue to record data every step of the way, including who handled it and where it has been, until it reaches the consumer. A blockchain ledger such as this can also be used to monitor labor costs and waste emissions.

Breakthroughs in Genomics The potential of genomics to improve the future of human health, once a dream, is now a scientific and financial reality. In 2001, it cost $1 billion to process a human genome. Today, sequencing a genome costs less than $1000, and SNP-based tests (that do not sequence the entire genome, just highly-variable regions, cost less than $100. The huge success of companies such as 23andMe and in bringing DNA tests to millions of homes has resulted in the unlocking of clues to our health, heritage, and even possible criminal connections.  Blockchain could find several applications in housing and maintaining genomic data as it can safely maintain gene sequence data. Further, it can become a marketplace where patients can share their data (or any subset thereof), with full attribution and even payment. In this way, scientists at pharmaceutical and biotechnology companies will be able to access valuable data far faster than before, and patients will no longer need to ‘volunteer’ their data without getting some type of material compensation.

Blockchain as an enabler of nationwide interoperability The Office of the National Coordinator for Health Information Technology has issued a nationwide interoperability ‘roadmap’, which defines both the policy and technical components needed for nationwide interoperability. Key amongst these is the development of a ubiquitous, secure network infrastructure, with the capacity to provide a verifiable identity and authentication of all participants, as well as the consistent representation of authorization to access electronic health information, amongst other requirements.

However, current technologies do not fully address all these requirements, because they face limitations related to security, privacy, and full ecosystem interoperability. Blockchain technology presents numerous opportunities for health care; however, it is not fully mature today and may need to be combined with other technologies (such as distributed databases, hybrid cloud/on-prem solutions etc.) to achieve complete security, privacy, and interoperability. Several technical, organizational, and behavioral economics challenges must be addressed before a health care blockchain can be adopted by organizations nationwide.

Other applications of Blockchain in healthcare include:

  1. Consent management. Given that different countries have different regulations, and that in the USA even states have their own privacy and consent criteria, blockchain could be used to record patient preferences for consent of various data types and combinations for the purposes of data sharing, for research, clinical, or commercial applications. Any individual, organization or company seeking to access patient health information would have a single location to determine the permissions available for a given class of data.

  2. Micropayments. The concept of incentivizing patients to achieve and maintain better health is beginning to generate interest. If a patient follows a care plan, keeps their appointments, and stays healthy, rewards could be offered via blockchain. Conversely, patients could be rewarded for contributing their data to clinical trials and clinical research.

In summary, Blockchain could make the biggest impact in healthcare by enabling better health outcomes. By generating a complete, 360° view of the patient’s profile, including their genetic, demographic, and socioeconomic data, as well as the behaviors that impact their health, as well as their response to different treatments or combinations. One of the most interesting aspects of implementing blockchain technology is the growth and modularity that it provides. Though it may face the same limitations as today’s technology, blockchain’s open nature should encourage and support industry-wide advancement for years to come.


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