A Case for Change In The Healthcare Industry Using Blockchain Technology
It’s no secret that the healthcare and pharma pricing industry is broken. Drug pricing and healthcare costs continue to skyrocket, patient conditions and treatments become increasingly complex, yet efforts to lower costs seem to remain stagnant.
The inherent flaws of current global healthcare infrastructure result in substantial inefficiency, wastage and sub-optimal health outcomes for the most important stakeholder; the patient. In healthcare today, there is a lack of incentive for health systems and providers to focus on mutually beneficial collaboration and the maximization of patient outcomes. Most would agree that a reasonable solution to these glaring issues would be adopting other innovative pricing models, such as value based pricing.
What is Fee for Service Pricing?
In a fee for service system, providers are incentivized for providing more treatments and prescribing more medication, at the expense of the patient. In addition, healthcare systems are often required to make the difficult decision of whether to reimburse costly pharmacological therapies and provide access for patients while taking into account their limited resources. This results in novel pharmacological therapies being denied to patients who are most at need, an opportunity missed to decrease the long term economic and disease burden on health systems, and a barrier to reimbursement for manufacturers.
As costs continue to increase and resources become more limited, one thing becomes clear- the healthcare industry as a whole will reach a breaking point because this model is unsustainable.
What is Value Based Pricing?
In the most simple terms, value based healthcare focuses on pricing based on patient outcomes as opposed to volume.
The healthcare industry is experiencing a paradigm shift to value-based care due to growth in demand, aging populations, chronic diseases and unsustainable levels of health related expenditure. Health systems are transitioning toward value-based care to prevent the rationing of services and increased costs for patients and payers without compromising quality of care. Provision of healthcare from a value-based perspective is based on the underlying aim of generating optimal patient outcomes relative to the monetary spend. Value-based pricing agreements are one of a range of options within a suite of innovative pricing solutions. Ultimately, these solutions are set-up with the aim of providing access to the right medicine, at the right time for patients and at the right cost for the healthcare system and manufacturers.
Transitioning from Volume to Value
Though it is long agreed that the shift from fee for service to value based healthcare is welcomed and necessary, the industry still struggles to transition.
Unfortunately, healthcare systems around the world lack the relevant infrastructure to track and implement innovative pricing models such as value-based pricing agreements, and so are reluctant to adopt such innovative policies. Furthermore, to be implemented effectively, innovative pricing or value-based pricing models require up-to-date and accurate data to track patient progress and treatment related outcomes, and to be able to report these criteria in a compliant and validated manner.
Until now, there has not been an effective way to solve the aforementioned problems on a global scale. Blockchain technology and smart contracts are the ideal solution to the age long problem of implementing, enforcing, and tracking innovative pricing solutions.
Our solutions aim to accelerate the much needed restructuring of healthcare delivery systems to a value-based approach.
Digipharm bypasses infrastructural limitations to enable the implementation of flexible value-based pricing agreements using smart contracts, the development of unprecedented evidence platforms and the ability to reward patients for contributing their data. We aim to utilize innovative blockchain technology to overcome barriers to patient access and innovative pricing, reduce costs for all stakeholders, and bypass infrastructural limitations to drive value improvement, incentivize innovation and expedite the transformation to personalized healthcare.
The Reimburse platform harnesses the benefits of automated ‘smart contracts’ and blockchain technology; facilitating the application of truly dynamic innovative pricing solutions between healthcare systems and manufacturers, in a secure and compliant fashion with minimal administrative burden. Use of the Reimburse platform will expedite integration, coordination and delivery of patient centric healthcare systems with a focus on improving patient outcomes while accelerating ‘payment for value‘ mechanisms between payers and manufacturers using neutrally-enforceable agreements in a peer to peer fashion.
Pre-agreed, personalised, contract stipulations will be coded on the Reimburse platform via an easily accessible user interface and automatically executed when contract conditions are met. Reimburse will also allow the implementation of several pricing conditions within the same agreements using smart contract technology, thus providing increasingly dynamic and personalised pricing solutions whilst bypassing the currently associated infrastructural barriers. The dynamic nature of Reimburse will allow healthcare systems and manufacturers to manage and monitor their budgets more effectively than is possible today.
The Insights platform will extract anonymised patient level data from the Reimburse platform and health information systems to the world’s first ‘live’ RWE database. Insights will provide a symbiotic solution with Reimburse to complement the progressive transformation towards value-based healthcare delivery systems. The development of a ‘live’ evidence repository will allow the integration of knowledge back into the delivery system in real time to facilitate decision making, drug development and health related research. Patients will be incentivised to contribute their health information to the Insights platform and will gain access to valuable health information that is currently unattainable.
Uniform and standardized inputs to smart contracts which are encapsulated within the Reimburse platform and the architecture of Digipharms’ bespoke integration solutions to health information systems promptly address several of the limitations that are observed with conventional RWD collection and database generation, thus expediting the time to availability of consistent and ‘ready to use’ RWE outputs. Additional health related data such as genomic data will also be linked to the Insights platform in partnership with leading evidence providers in the industry, to create an unparalleled health data marketplace in preparation for a value-based, data-driven future of healthcare. The use of cryptographically encrypted blockchain technology also eliminates all patient privacy and data security concerns that affect current RWE generation systems. There are no such ‘live’ RWE databases currently available.
The use and reliance on RWE is growing and will have huge impact in supporting clinical research, trial execution and decision making in healthcare.
Utilising blockchain technology for Digipharms’ platforms promotes the development of a decentralised health information infrastructure that is ubiquitous, transparent and security conscious. We bring together industry expertise, a mature concept and revolutionary blockchain technology to facilitate the transformation of healthcare to a value-based approach.
Our vision is to be the pioneer of sustainable and value-based healthcare delivery, innovative evidence generation and patient empowerment across the healthcare industry.
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