When cryptocurrency and blockchain blossomed into mainstream popularity in 2017, entrepreneurs took on the challenge to potentially solve many of the issues the healthcare industry has faced for decades.
Teams consisting of medical doctors, Ph.D.’s, and former healthcare executives joined forces with talented developers to build scalable blockchain systems that tackle niches such as medical supply chain management, patient data storage and sharing, to even aggregating big data for medical research.
To truly see the value in the advantages offered by blockchain and cryptocurrency, it’s important to understand the impact of each technology. The healthcare industry is ailing for an overhaul, and here’s where blockchain can start.
Combating Global Healthcare Fraud
The first and most immediately applicable solution of blockchain in healthcare is overhauling its largely inefficient payments and supply chain network. According to a Harvard Medical School report, a whopping $455 billion intended for healthcare is lost every year to fraud or general misuse. The majority of this fraud occurs in developing countries, where every dollar lost can be incredibly destructive for the wellbeing of local populations and native economic development.
Blockchain is essentially a global, immutable, distributed ledger that enables for highly efficient monitoring of financial transactions and tracking of shipments of drugs and medical supplies. These automated systems eliminate corruption by removing the need for a human third-party intermediary to oversee any delivery or distribution of funds. Additionally, blockchain makes it much easier to pinpoint exactly where the loss of funds or supplies occurred quickly enough to be able to act, as opposed to having a team of forensic accountants sifting through heaps of paper files.
John Meara, the Steven C. and Carmella R. Kletjian Professor of Global Health and Social Medicine in the field of Global Surgery at Harvard Medical School, notes how blockchain can serve as a powerful tool to eradicating these issues.
“For too long global health aid has focused on getting grants out the door rather than delivering care to the patient,” Meara said. “Blockchain technology can help us dissolve transnational financing barriers, ease inequitable capital access and build more efficient means of distributing help where it is needed most. And it can do this all while curbing fraud with unprecedented transparency.”
Uniting a Fragmented Landscape
The United States medical system is a colossus consisting of thousands of localized private and government organizations, and as you can imagine, this leads to a lot of miscommunication and inefficiency.
This fragmented landscape combined with the lack of communication and continuity lead to higher costs, longer processing times, duplication of efforts and the exacerbation of urgent health conditions.
The average patient who needs medical care will likely go through the rounds with hospitals, clinics, specialists, general practitioners, and diagnostic clinics – while also receiving different bills for each (and often, multiple bills for each treatment if multiple specialists were involved).
A joint study by the Maine Multiple Complex Conditions Project (MMCCP), Maine Department of Health and Human Services, and the University of Southern Maine Muskie School found than beneficiaries that received fragmented care saw a 25 percent increase in medical costs and 16 percent more visits to the emergency department.
The crux of the fragmented medical treatment landscape revolves around compliance, billing, and a fee-for-fee system where specialists are incentivized and compensated on the number of patients they see, rather than thorough integrated work aimed at solving complicated multi-faceted health issues. Any attempt at integration creates additional, unpaid, work for every specialist.
Blockchain and smart contracts have the potential to bring order to this chaos and unite the fragmented service and payment ecosystem. An award-winning white paper published by researched from MIT describes a blockchain-based system that facilitates the secure and efficient exchange of data using the Ethereum blockchain and smart contracts.
The concept introduced, MedRec, focuses on solving the constraints of Electronic Health Record compliance. MedRec gives patients and doctors an easy-access, comprehensive, and immutable log to their medical records across all providers and treatment locations. The blockchain manages everything from authentication, confidentiality, accountability, data sharing, and most importantly for its efficacy, permissions with sensitive information. The modular design integrates with local data storage solutions and is interoperable with what doctors are already using. MedRec even taps into the concept of data economics, where “miners” are incentivized to sustain and secure the network with access to aggregate, anonymized data.
While the project is still in its early stages, the purpose is to illuminate a working prototype that would serve as a landmark solution for blockchain in health IT and research.
The diagnosis for the healthcare industry is in, and it’s not looking so good. Thankfully, there are countless entrepreneurs that are working to solve the major issues plaguing healthcare and capture a lucrative piece of the value created by solving them.