Blockchain is a catalyst for changing processes and business models across the enterprise companies in healthcare. Let’s find out exactly how blockchain is becoming a disruptive force, particularly in the healthcare sector.
The Healthcare sector is a massive marketplace. Only in the US, the total healthcare expenditure is estimated at $3.8 trillion in 2018. It’s also predicted to reach $6 trillion by the year 2027. But the sad reality is that this important aspect of our life is extremely inefficient. In reality, more than 30% of healthcare spending is wasteful because of poor management and security.
The state-of-the-art innovation blockchain relates to healthcare by offering high security, tracking medicines, and giving ownership back to individuals who have the right to consent for its use. More so, individuals can also migrate between data based on the custody of the data across various organizational boundaries.
Blockchain can truly make a change, and it’s high time in our healthcare sector to utilize this tech for its own benefits. So, in this guide, I’ll walk you through the realm of blockchain in healthcare and how this tech is slowly disrupting this sector. Let’s start!
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Blockchain In Healthcare: Why This Sector Needs to Change?
The current healthcare system is full of loopholes and security issues. Most of these issues revolve around medical data, drug supply chain, clinical trials, patient information, doctor credentials, and so on. As of today, these issues are so overwhelming that even the top healthcare companies aren’t capable of dealing with it. Let’s see what these issues are –
This is one of the deadliest issues of this sector. In reality, healthcare industries don’t have the proper tools to track each drug from the manufacturing stage to the patients. Therefore, a lot of drugs get counterfeited. The worst part is that these counterfeit drugs get into the system without detection, and people only buy them to fall severely ill.
In many cases, these drugs are even life-threatening. The issue is, the massive number of counterfeit drugs also causes the healthcare industry to lose money each year. Pharmaceutical companies can lose billions every year for counterfeit products.
Poor Data Management and Segmentation
This is another major aspect where the healthcare system fails greatly. Actually, the management system in the healthcare industry is truly not up to the mark. As a result, most of the data gets lost or misplaced. So, when there’s a need for them, you can’t find them easily or in time. In reality, it can also lead to physicians getting misinformation or even delays in receiving the proper information causing serious harm to the patients.
Also, in many cases, the data is segmented throughout the database and in a disorganized manner. So, organizing them under the same criteria is also not possible.
No Patient Privacy
The worst part of the healthcare system is the lack of privacy for the patients. On the patient’s end, they don’t have any control over who can see their personal information and who can’t. Also, they tend to not have any access to their own information, which is quite absurd to begin with. Most of the time, this information gets sold off to third parties, where they misuse the information without the patient’s consent.
In reality, this decreases customer satisfaction levels and doctors’ trust in making the best call.
Not Enough Healthcare Data Storage
It’s not a surprise that the healthcare sector will continue to store patient information because this information is necessary for the benefit of the patients and even for researchers later on. But over time, the storage system of these healthcare data has become obsolete. These are not enough to store the increasing amount of information or even capable of analyzing them.
More so, the data storage systems have software loopholes that are easily targeted by cybercriminals. So, it poses the threat of a massive security breach.
Healthcare systems need to have a higher level of security protocols in order to safeguard both patients and doctor confidentiality. But the technology they are using currently isn’t suitable for this task. In reality, the legacy technology is prone to security loopholes which are giving rise to cyber-attacks.
Most of the time, these cybercriminals get access to these data and sell them to a third party who misuses the information. The worst part is that in many cases, the authority doesn’t even realize that the system has been hacked.
So, without solving this issue, the healthcare industry will soon fall behind.
The cost of healthcare is increasing day by day. More specifically, the manufacturing cost of drugs is really high, and as a result, the consumers have to buy them at a high price. This does not allow every person to access proper healthcare facilities, which is their right.
However, due to the increasing inefficiencies of the supply chain sector, manufacturing and shipping costs increase, leading to a product price hike. So, for starters, this sector needs to figure out the inefficiencies and take measures based on that.
Also Read:Top Features of Blockchain Technology
Benefits of Blockchain In Healthcare Industries
Now that you know what are the main issues of this sector. Let’s check out the benefits blockchain can bring to the table.
Using blockchain in healthcare can help you to get data accuracy at every stage. To ensure that all healthcare system medical records are on point, blockchain can lend its immutability to the task. In reality, any information stored on the blockchain can’t be altered in any way. So, if you put a proper auditing procedure in place, then every single document will stay intact.
So, there will be no scope for any kind of discrepancy or inaccurate information. There are already many projects on the way to solve this particular problem for healthcare.
The benefits of blockchain in healthcare extends to interoperability as well. In reality, you can use blockchain technology to connect to various parties within this industry. For example, you can use a blockchain platform to work as a hub for connecting to health insurance providers, hospitals, pharmaceuticals, distributors, or even health inspectors.
This way, you will get a more all in all experience where the patient can automatically ask for insurance when he/she is in the hospital. Also, this helps to verify a lot of legal documents in a much shorter time.
Blockchain strives to offer the best security protocols in the market. Using blockchain, healthcare systems can boost up their security procedures and eliminate any threat of cyber-attacks.
So, no criminal can just hack into the system and access the data and sell those to third parties. This is one of the benefits of blockchain in healthcare that is completely necessary. Also, as the technology doesn’t have a central failure point, in times of natural disasters, the healthcare community can access the documents regardless of their location.
Low Handling Costs
The handling cost of blockchain technology is quite low compared to traditional legacy systems. Even with low maintenance, the system is perfectly capable of handling a high surge of traffic within a short amount of time. Not only that, but some platforms can offer 3000-10000 transactions per second. Just imagine how much faster that is compared to traditional processing systems.
This is something the healthcare sector lacks as they invest millions of dollars every year just for the sake of maintenance. In reality, blockchain can disrupt healthcare effectively by offering this cost-cutting solution without any hassles. However, there are some other cost factors to it. I’ll explain it shortly.
Another benefit of using blockchain in this sector is the traceability feature. In reality, blockchain can offer real-time tracing of drugs or any other actions within the ecosystem. For example, manufacturers can track all the drugs from the production line all the way to consumers. More so, they can even track their supplies to ensure the highest quality each time.
Another great feature is the tracking of medical test reports. Using this, a patient will know just when he/she can expect to get the delivery of various medical tests. So, in this way, blockchain and healthcare can start to co-exist and create a better and efficient working ecosystem.
What Are the Probable Use Cases?
Securing Electronic Health Records
Let’s picture a scenario where you only have to fill up your medical forms only once and not deal with any paperwork ever again! Blockchain in healthcare can offer you a single portal with all of the information in digital formats. Typically, healthcare industries are still using paper-based manual systems, which is prone to errors.
But with blockchain in the mix, it’s only a matter of time where every single document gets a digital presence. Also, there are many applications of blockchain in healthcare that create a hub for the patient, and he/she can upload their general information there, and other physicians can view them with permission.
So, it’s a great use case for blockchain.
Better Insurance Claims and Audits
Blockchain and healthcare can create a wonderful ecosystem where insurance claims are processed at a greater speed. In reality, we all need health insurance to cover our medical bills. But the process is extremely time-consuming and a bit tedious.
Actually, all Americans have to have health insurance, or else they will have to face a penalty. Although the system may vary from country to country, in the end, insurance does play a big part in it. So, the process needs to be as smooth as possible, or there’s always someone bound to get in trouble for that.
Using blockchain, companies can streamline their health insurance policies, keeping track of any suspicious behaviors along with getting rid of all paperwork. Also, by linking to the hospital directly, they can get updates on the patient’s condition and requirements.
Preventing Fraudulent Billing
Every year, billions and billions of dollars are collected as a settlement for fraudulent billings and false prescriptions. The transparency of these medical bills is nonexistent, and so the patients are the ones falling victim to this every single day. To stop this, blockchain can offer the transparency of each transaction that happened for every single patient.
As the patient can keep track of their bills through the blockchain platform, there is no scope for medical bill scams or over-billing a patient. Thus, blockchain and healthcare industries can create a proper safe space for consumers that builds trust and security.
Reducing Counterfeit Pharmaceuticals
Counterfeit pharmaceuticals are one of the main issues of the healthcare sector. As you already know, this gives rise to billions of losses every year. According to the World Health Organization, more than 10% of the world’s pharmaceuticals are counterfeit products. Even though it may seem like a small amount but in reality, it puts $75 billion in the illegal manufacturers’ pockets.
More so, with this much counterfeit products every year, 100,000 people die. In this case, blockchain would disrupt healthcare by offering a proper tracking procedure. In reality, you can use blockchain to track all the drugs and ensure that consumers are only getting the original ones. More so, this will also help to identify any counterfeit drugs and manufacturers.
Verifying Clinical Trials
This is another one of the use cases of blockchain technology in healthcare. In reality, medical testing or clinical trials depends heavily on the data verification process because valuable lives depend on it. However, the data is not 100% verified in many cases, giving a scope of fraudulent activities.
But the cost of verifying all data is quite expensive when there’s a tight budget. More so, the return for this kind of investment is next to zero. Roughly $150,000 is spent on data verification with only $500 in return.
However, blockchain can help to solve this issue by offering a hashing mechanism to verify and timestamp all the data to prevent errors. Therefore, it can also reduce the cost of storing or verifying all this information. There are already many applications of blockchain in healthcare that are offering this feature.
Protecting Patient Data
Patient data is one of the most crucial elements of healthcare industries. As you already know, patients at the moment don’t really have any grip over their data. Therefore, misusing all the information is an easy task for criminals or shady companies.
Also, in most cases, these data breaches cost heavily as in the only USA, it takes about $6.2 billion every year. More so, this cost gets passed down to the patients, ultimately increasing their overall expenses, which is definitely not fair.
Blockchain can disrupt the healthcare industry by using its privacy policies. Many blockchain platforms are private or federated. So, using these platforms as a base, the healthcare sector can offer patients privacy and security. Thus, it will also eliminate data breaches as well.
Medical Staff Credentialing
There are many doctors and experts in the medical field without having a proper background check. In many cases, the lack of time and resources, and overwhelming demand can make hospitals or clinics overlook this process.
As a result, sometimes, under-qualified people can get hired in a demanding job position, which puts the patients at risk as well. However, blockchain can quickly replace this old method of verification with state-of-the-art decentralization where it can get verified directly online.
More so, you can also use this tech to allow full, partial, or very limited access to all the credentials. At present, there are many applications of blockchain in healthcare that are offering this feature.
Implementation Challenges and Considerations
There are certain implementation challenges associated with blockchain. In reality, using blockchain in healthcare still needs a lot of work. At the moment, blockchain is still a relatively new technology. So, it does have some constraints that need to be fixed. Therefore, any implementation of blockchain in healthcare sector needs to consider these from beforehand.
Blockchain is a wonderful technology, but there is a tradeoff when it comes to using all the benefits it offers. For starters, it deals with scalability problems.
So, when there are too many participants in the network, the performance of the network drastically deteriorates. So, this can pose a huge problem as the sector does deal with a lot of patients at a time.
However, there are some crucial factors in this. Certain implementation of blockchain in healthcare is trying to solve the problem with private blockchains or using different consensus. But it still needs a long way to go.
Data standardization is a massive point of concern. Without understanding or selecting what type of information should be stored on the platform, you can’t utilize the benefits properly. For example, if you choose a data type that is much larger, then you will find it difficult to store all kinds of information even if you use blockchain.
Let’s say a platform wants to preserve the doctor’s note as well. But that’s an unnecessarily large size for storing, which will evidently affect the performance. So, in that case, outlining the data standardization beforehand will evidently prevent it from underperforming. Any kind of implementation of blockchain in healthcare should offer standards for storing data.
Blockchain implementation challenges can become a big hurdle for your project if you don’t know how to manage them. You can check out the top 10 enterprise blockchain implementation challenges to learn more about them.
Slow Adoption Process
One of the massive challenges of blockchain in healthcare is the adoption phase. As it’s a new technology, many aren’t interested in using the tech instead of the legacy systems they have been using for years. In reality, it is a massive change and can alter the ways of how we are conducting business.
Also, the incompleteness or the new feature is somewhat unpredictable because no one knows how a world with a blockchain-based ecosystem will really feel like. So, the adoption process is still quite slow. In this case, organizations or platforms can offer incentives to motivate people to participate.
This is one of the disadvantages of blockchain in healthcare. In reality, blockchain technology can increase your revenues, but implementing or even replacing previous systems with this requires a massive investment.
As the technology is still not widely available, and only a small amount of companies or startups are working on it, the pricing is still quite high. Also, as healthcare organizations have to migrate to the new technology from their old systems, it will need more time and money to replace each of them. That’s why many companies are not interested in investing this much money in technology.
Another one of the major disadvantages of blockchain in healthcare is the lack of regulations. Without proper regulations within the platform, the healthcare industry can’t perform efficiently. These companies need regulations to keep up with everyday tasks and follow specific rules to eliminate any illicit activities.
So, what organizations can do, is to make policies on the administration of the blockchain technology along with outlining the regulatory terms from beforehand. However, they also need to consider the decentralized nature of the system as well.
Any kind of modification should take place without affecting the core principles of blockchain.
Real-World Companies Using Blockchain For Healthcare
Change Healthcare is one of the companies that is using blockchain in the healthcare sector. Anyhow, they are offering an Intelligent Healthcare Network™ for managing patient claims and status tracking in real-time. More so, it’s using Hyperledger Fabric as the underlying technology for the project.
Want to know more about Hyperledger Fabric? Check out our ultimate guide on Hyperledger fabric now!
FDA (Food and Drug Administration)
FDA’s solution is another creative take where you can see blockchain disrupting healthcare. More so, this platform will secure healthcare data such as EMR, genomic data, clinical trials, and so on, Anyhow this technology is also using Hyperledger to power their solution.
DHL is another good example of blockchain thriving in the healthcare sector. In reality, they are working with Accenture on a POC that will trace pharmaceutical drugs from manufacturing to the consumers. This way, they can easily deal with counterfeit issues.
Centers for Disease Control and Prevention
Centers for Disease Control and Prevention is also here to use this technology for the healthcare sector. At present, they’re working directly with IBM on a platform that will record and provide security to all Electronic Health Records (EHR). So, they are using Hyperledger Fabric for that.
It’s one of the largest pharmaceutical companies in the world. In reality, Pfizer and Biogen are using blockchain to disrupt the healthcare sector by creating the Clinical Supply Blockchain Working Group. More so, this group is developing a POC for tracking and managing records of the digital inventory of pharmaceuticals.
World Health Organization (WHO)
Another one of the great blockchain healthcare projects is using the tech to safely share data concerning coronavirus. More so, the platform will use Hyperledger Fabric as the underlying technology. Additionally, the platform can offer early detection and hotspots for COVID-19.
MetLife’s innovation center LumenLab is working on health insurance automation processes. In reality, they are offering automated insurance to pregnant women who are dealing with gestational diabetes. The best part is they don’t even have to claim the insurance; it will automatically go to them once they are offer proof of the issues.
GlaxoSmithKline is one of the biggest pharma companies at the moment. But they are also working on various blockchain healthcare projects. One of the projects uses Ethereum that will track all the pharmaceutical products and eliminate the scope of counterfeits to get mixed with authentic products.
McKesson is one of the leading companies in the healthcare sector. In reality, this company, along with other giants, are working with MediLedger for creating a platform for contracting and chargeback. Pharmaceutical companies usually have a pricing arrangement with GPOs and wholesalers. So, it’s important for every party to know the preferences before purchasing them.
UnitedHealth Group is working on one of the blockchain healthcare projects that is focused on keeping all healthcare records updated and secured. In reality, as healthcare deals with incorrect information most of the time, the company is taking steps to eliminate this issue once and for all.
Blockchain slowly taking over the healthcare industries. However, it may be one of the technologies so far that is changing the hierarchy of the healthcare industry by giving authority to the patients.
This transfer of authority is ultimately leading to more patient-centric care. However, the effects of blockchain in healthcare are only on the surface level so far. It still has a long way to go.
Any beginner can use this guide to learn about technology’s disruptive force. But if you’re more interested in learning about blockchain technology, you can start with our free blockchain course. Take the first step towards a new era now!