How Health Care Is Moving Toward Blockchain

Fact checked by Suzanne KvilhaugReviewed by Doretha ClemonFact checked by Suzanne KvilhaugReviewed by Doretha Clemon

Although individuals on different sides of the political spectrum are likely to disagree about what’s to be done to fix the U.S. health care system, few would likely dispute that the sector is in rough shape and faces even more turbulence ahead. Here are some of the issues the U.S. health care system faces and what blockchain could do to help.

Key Takeaways

• The healthcare industry in the U.S. is plagued with issues, most notably information silos that do not communicate well with each other regarding patients.
• Blockchain could solve many of the data issues within the healthcare industry.
• For blockchain to be successful in the healthcare industry, there will need to be less focus on profits and more focus on patient care and well-being by private hospital owners.

Healthcare Issues in the US

There are many issues plaguing the U.S. healthcare sector, but patient data and information are the most important, besides the astronomical costs of care and insurance. Patient data is often scattered across different facilities, sometimes in separate counties or states. This dispersion of information makes it difficult for doctors to provide continuity of care because critical medical information cannot be accessed at crucial times.

Growing Data Requirements

According to the World Economic Forum, one hospital generates 50 petabytes (15 zeros) of healthcare data annually (about 137 terabytes per day). Included in these figures is the increasing use of connected medical devices within hospitals, which record patient data. Hospitals must rent storage capability from other businesses or build storage facilities and data centers themselves. All of this networking and storage add to healthcare costs.

Data Security

Data storage also creates an issue regarding cybersecurity. Because patient data contains personal information, stolen patient data can result in identity theft, insurance fraud, credit issues, and more. These vulnerabilities place patients needing care in more precarious positions. Additionally, if data is hosted externally, the hospitals must ensure that their chosen data storage providers do not violate privacy laws.

Errors in Record Transfers

Many healthcare networks are distributed across different cities or towns, and patients need to travel between specialists. Records are stored on these facilities’ networks in the format accepted in those facilities. However, the records the original provider’s hospital uses may be in a different format because record-keeping standards are lacking.

The lack of industry-wide entry standards in healthcare patient databases can create fragmented or erroneous patient histories, which can lead to misdiagnosis, malpractice, or untreated health issues.

Processing Times

Payment processing times and invoicing errors cause delays in hospitals receiving payments for services and cause extra stress for patients dealing with health issues. Healthcare costs increase as hospitals attempt to collect, and improper invoicing adds additional pressure on rising costs.

In addition to payment processing, patient processing can be slowed if records must be requested from external providers. Information within these records could be crucial in identifying an issue, as it could be related to previous issues or treatments. With faster access to records, doctors are able to learn what else has been done regarding a patient, preventing them from having to run tests other providers have completed, decreasing diagnosis times, and increasing the chances a patient has.

Private Equity Companies Own Many Hospitals

One of the looming issues in the U.S. regarding healthcare is that many hospitals are owned by private businesses or equity firms, who prefer profits to patient care. According to the Private Equity Stakeholder Project, about 460 hospitals in the U.S. are owned by private equity companies, which equates to about 8% of all private hospitals and 22% of all proprietary for-profit hospitals. More disturbing is the fact that an estimated 22.5% of the hospitals owned are psychiatric hospitals, which means that PE firms are very interested in profiting from treating mental illnesses.

Private ownership of hospitals creates more barriers to patient data and treatment accuracy. Silos exist because patient data is not only private; it becomes the property of those hospitals who use it as a way to generate more money.

How Could Blockchain Help Healthcare?

Blockchain technology could revolutionize the way that health data is stored and transmitted. Indeed, blockchain tech may be a solution for the industry because it sports an ultra-secure cryptographic database and shared ledger that can provide speedy and accurate communication.

Using blockchain, healthcare systems could store medical records confidentially, updating patient data across multiple facilities and locations in real time with a high level of security. This would free up time and resources in healthcare facilities to be further dedicated to patient care and innovation rather than administration.

Patients, rather than the companies and firms that claim ownership of their data, could reclaim their information and charge the hospitals for using it through tokenization. Patients could refuse to have their information monetized, or force these companies to pay them to share it with others.

Blockchain Solutions Already in Play

Several companies have already made use of blockchain in an effort to enhance health care. None of these operations have taken off on a national scale yet, but they signal interest within the industry, as well as a theoretical openness to new technology.

Hashed Health is one such company. Utilizing blockchain, Hashed Health generates a free and open community for healthcare professionals to discuss and partner in an effort to explore blockchain’s uses in the industry. The company also provides an advisory branch to help healthcare organizations understand how blockchain can be integrated into existing systems. Lastly, the company has a lab that aims to develop new blockchain tech solutions to problems that have plagued the healthcare industry.

Medrec:M is another blockchain-focused company in the healthcare space. It operates a transparent peer-to-peer ledger that allows providers to track files and information seamlessly. The service also allows for easier direct communication with patients. Clinicians, facilities, and large-scale systems are connected on a single platform, allowing for the most efficient transmission of information currently possible.

How Is Blockchain Used in Healthcare?

There are several ways blockchain can be used in healthcare, but it has yet to reach widespread adoption in the industry. First, the U.S. healthcare system is too privatized, and second, there is a lot of work to be done to create a viable and secure healthcare blockchain network.

Why Is Blockchain Not Used in Healthcare?

While there are numerous advantages to using blockchain in healthcare, it has not yet been adopted because there is a lot that needs to be done to coordinate and secure a distributed but centralized private blockchain that stores sensitive information.

What Is the Scope of Blockchain in Healthcare?

Blockchain could present many solutions to healthcare issues, but the most important one is sharing patient data across a national network securely and accurately.

The Bottom Line

To be sure, many companies are looking to revolutionize health care through blockchain. Whether any of these operations succeed in transforming the industry’s ailments and problematic practices remains to be seen. There is much to be done before the healthcare system can cooperate within itself enough to make blockchain work.

Read the original article on Investopedia.