How does Blockchain apply in Healthcare ?

Blockchain in Healthcare

Blockchain is the new hot cake and it has applications in many industries. The healthcare can use blockchain to streamline and reduce a lot of inefficiencies and we will look at all of these in details. But just as every other blockchain article on the internet, we need to start from “what is blockchain”, the reason being that since the concept is so novel, the awareness is still pretty low and the concept isn’t very straightforward as well, making it hard for a sizeable chunk of the population to wrap their head around. If you know how blockchain works and you came to the article only to read more about its applications in healthcare, feel free to skip the next couple of paragraphs.

Almost everything in human society revolves around transactions, even in the earlier times, for the cave people, it was trading meat for let’s say, clothing. This pretty much happened till the time when currency was invented, this is when we started transacting for goods using currencies. Over time, population grew, roads and waterways opened up between regions that were far-away and people wanted to transact with each other, this created the need for central bodies that would set rates of these currencies, assist in transactions between multiple currencies and keep records of the amount of currency in circulation. These central bodies are the banks and the governments which basically regulate the complete financial systems of the world. Now, the problem comes when banks and governments become all too powerful and they control the currency and may change / edit information without the people coming to know about it. This has happened many times in the past (remember the questions we used to have as kids, “who prints money ?”, “how do they know how much to print ?”, “what if they print some extra for themselves ?”). Also, centrally handling the currency can also open up governments and nations to economical warfare where other countries can manipulate the global strength of a currency by simply increasing the amount of currency in circulation (by issuing counterfeit currency). Not to mention the lack of security. In the modern times, we’re spending our money online using cards, our money is being deducted automatically for subscriptions. There is a big trend of making payments easier and easier using mobile wallets and the less painful we make our transactions, the less secure they become because our current currencies aren’t adapted for modern, digital usage.

A few years back, somebody thought of changing this and created something called as a “decentralized” way to run transactions. Decentralized means that each node is as powerful as the other, there is no middle man, no all-powerful body like a government that controls everything, this means nobody can manipulate anything.

There are 4 key dimensions of block chain ->

  1. Shared “ledger” (an append only distributed system of record shared across a business network)
  2. Smart contracts (business terms embedded and executed in a transaction database
  3. Consensus (all parties agree to the validity of a transaction and commit it to the blockchain)
  4. Privacy (transactions are secure, authenticated and verifiable)

The way this architecture is setup is, it has something called as “ledgers” which maintain all information of all transactions ever since the blockchain was started and the beauty of this architecture is, that there is no central ledger, instead every node has its own ledger where it is maintaining information of all the transactions that are taking place. But does this mean that everyone knows what everyone else is doing? not really, because a ledger does not store personally identifiable information but only stores the “hash” that is generated, as hash is a unique code generated after every transaction. Every node or user on the blockchain has their own secure address which can also be called as the wallet information, basically the place where they store their own currency.

The ledger in blockchain is append-only, there are no edits allowed, once something has been recorded, its permanent, it will never change. (this may sound too rigid, but it has a lot of benefits). When a new transaction has to be recorded in the blockchain, across all ledgers, all ledgers must be in agreement which in blockchain terms is a concept called “consensus”. So a transaction is only added to the blockchain when all the nodes are in consensus regarding something. This impermutable nature of blockchain makes it impossible to manipulate by anyone, so you technically can’t steal money and get away with it (unless you convert it into a different currency, which is how most of the theft is done, but this reflects badly on the other currency and not the blockchain currency).

This means that the trust in blockchain is not established through banks, governments or third-party intermediaries but through a systematic network consensus, collaboration, and cryptography. The blocks of data are securely recorded and are continuously updated as new transactions are made. This list is shared by all parties participating in the transaction through a distributed network of computers.

Currency (like bitcoin and ethereum) is only one small application of blockchain, the said “transaction” could be of anything such as documents, medical records, patient information etc. and this is what brings us to the second part of the article where we talk about the applications of blockchain in healthcare specifically.

We all know IOT, now, there is an offshoot of IOT called IOMT (internet of medical things), which basically involves all medical machines and the wearable that patients wear to track medical information, now there is huge amount of data generated here, right from your blood glucose level to your blood pressure, which basically shows your mood (if you analyse it). What if this information reaches the wrong hands or let’s say, advertisers. You’d be seeing pizza ads when you’re sad and your blood glucose is low, manipulation of human beings at that level is wrong because it’s a breach of privacy, nobody was supposed to have this information in the first place. This is IOMT and information from these devices may still be hard to access as these devices aren’t in heavy usage in emerging markets, but what about information that is easier to get but shouldn’t be? like patient records Since there is a central place where all the patient records are stored (with the hospital administration), it’s easy to steal, manipulate the information, also hide critical information from patients about their treatment (an extreme case is covering up medical negligence by manipulating medical evidence, this is not very uncommon though). There is an overwhelming amount of data being generated in the healthcare industry, blockchain can be used to bring some security and trust in data and thereby empowering the patient.

There are three major areas in healthcare which blockchain can revolutionize significantly -

  1. Medical insurance claims
  2. Pharmaceuticals
  3. Patient records and practioners’ credentials

The medical insurance claims industry is plagued with errors and disputes because the format in which the information is required by the agencies is not clear and is quite transient and the information provided by a patient is in the form of a physical filled out form with various attachments of medical bills and reports which insurance companies find hard to validate and verify at times, thereby leading to problems in clearing the claims and more often than not a patient that is genuinely suffering is at the receiving end of this problem, thereby leading to millions of dollars in disputes and law suits, not counting the amount of money spent by insurance companies to very the claims by checking medical history of the patients. There is also heavy amounts of administrative tasks resulting from the tangible paper based forms and attachments submitted by the patients, a lot of this information is also lost in “translation” or conversion to digital format.

Blockchain can solve this by creating a shared, distributed ledger — one single version of the truth that is always in-sync and facilitates recording of transactions and asset tracking for anything of value. allows all parties involved to monitor and analyze the status of an asset in near real-time. Basically this means that the new process for claims that blockchain will make available will be— proper data formats requirements (from the agenices’ side) will be stored on blockchain, ensuring all information is entered correctly, the provider knows what type of information is required to submit claims. This clarity reduces claims being returned due to insufficient information.

In pharma — The supply chain in the pharmaceutical industry is complex and can play a crucial role in maintaining the speed of delivery, quality, and safety standards, thus increasing revenues and driving profitability for big pharma. Products such as research materials, drugs, medical devices are transferred along the chain through many stakeholders such as suppliers, manufacturers, distributors, repackagers, and retailers. This makes it important to have strict checks and regulations to track every single medically related product’s authenticity and integrity from the beginning of the chain to the end at the level of the consumer. One of the most serious and threatening problems for pharmaceutical supply chains is the distribution of counterfeit and sub-standard drug products that can, more importantly, cause serious harm to patients’ safety as well as incur heavy losses for big pharmas. In 2013, Drug Supply Chain Security Act (DSCSA) implemented by the FDA called for end-to-end traceability of all pharmaceutical products by 2023. According to DSCSA, the players in drugs supply chain must provide transaction information, history and statement to every end-user or consumer. This triad of standards is referred to as the ‘T3 information’, which requires national drug code and propriety name, dosage information, batch and lot number, date of manufacturing, transaction and expiry, name and information of the dispenser as well as end-user. This could be achieved through the integration of blockchain technology to maintain detailed records of the unalterable ledger which could be audited for regulatory compliance and product integrity. Pharma giants like Genentech, Pfizer and Sanofi have invested in the MediLedger project which is a pilot program that uses blockchain tools to track medicines. Innovative companies like combines blockchain with sensors that track environmental conditions of temperature-sensitive pharma products during shipment. Data recorded is checked against the smart contract which validates that the product meets all of the standards set out by the sender. Upon receiving the pharma product the patients can trigger notifications to sender and also release payment all on the blockchain-enabled platform. Blockchain can also transform the delivery of a prescription drug by removing barriers to entry and streamlining the delivery process. This can lower cost of prescriptions, provide better access while maintaining patient confidentiality and security.

Few of the disadvantages of this pioneering technology that could disrupt existing mechanisms of business could be barriers to adoption and implementation, the initial cost of set-up, its regulatory compliance and future technological competitors

In a white paper report by IBM- ‘Healthcare Rallies for Blockchain’, a study comprising of 200 payer and provider executives from 16 countries concluded that 16% of them were likely to implement commercial blockchain by 2017 and as many as 56% had plans to adopt it by 2020.

If we notice, at the moment, all administrative transactions (at the healthcare provider side, at the insurance provider’s side and the pharma companies’ side) are happening in silo from each other and they need to be on a single blockchain so that everyone has access to everything. This will completely revolutionize the healthcare industry.

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