Transforming Health Insurance — Is It Possible Using Blockchain?
The insurance system requires many back-office processes to clarify whether the insurer or patient pays for a service. This coordination between medical providers and insurers, each using their own systems and processes, causes delays and unnecessary admin costs, not to mention a poor experience for patients.
A telling example is a current process for getting authorization from insurers. A member of the hospital staff will confirm the patient is covered by insurance, check the procedure is covered, and request authorization from the insurer, possibly rechecking multiple times.
It also reveals that outdated systems such as fax machines and screenshots for auditing are still used in this process. And such inefficient workflows contribute to unnecessary spending in the healthcare industry.
Enter Smart Contracts
Rather than taking hours or days essentially to confirm trust between parties, a smart contract could take seconds to check whether a procedure is covered by insurance. If an authorization code is needed from an insurer, it could pause the process and automatically resume as soon as the insurer has entered a code.
Smart contracts executed on a blockchain based structure provide accountability and verification, thanks to the cryptography behind blockchain. Replacing manual screenshots as an audit trail with an immutable transaction history is simple, as everything is recorded by design.
Could the migration of such a widely used system realistically happen?
Yes, it really could. By populating a blockchain based network with billing documents and member lists, staff can look up trusted information in seconds, rather than check and recheck with an insurer.
In fact, the entire authorization collection process above could be replaced by a smart contract. Since each piece of information is trusted, a computer can automatically confirm each step, with instant results.
By taking hospital staff away from fax machines and waiting on hold, they can be more productive and satisfied. Patients would have drastically reduced wait times and transparent cost breakdowns. Plus, this is just the beginning; it sets the stage for a tech revolution in the global healthcare industry.