The Case for Blockchain in Healthcare

Posted by Nathan Miller on 3/14/19 4:57 PM
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Connor Smith and Nathan Miller


At the risk of stating the obvious, healthcare is complex. While advances in biology and genetics have led to novel breakthroughs in therapies to treat patients, the IT infrastructure supporting U.S healthcare can be painfully archaic. The ecosystem of patients, providers, and insurers that have to interact with one another at different points throughout the treatment process leaves multiple touch points for data to be mishandled, lost, or modified. To make matters worse, the amount of data that healthcare providers have available to them is increasing at an exponential rate. The average hospital now handles and stores hundreds of terabytes of data on its servers, sometimes reaching Exabytes of data, and this number is only increasing. Considering that healthcare was one of the last industries to ‘go digital’, is it any wonder that patient data management is still a major issue? Unfortunately, disjointed patient data management and incomplete data records can result in poor, ineffective, or misguided treatment that can have negative impacts on the patient. Consequently, thousands of people die and billions of dollars are wasted on unnecessary or improper treatment.


We foresee that the next major innovations for healthcare data will be on public blockchains. We’re not suggesting that health data should be stored publicly nor are blockchains suited to store large amounts of data (such as a CT Scan). Blockchain would be best suited as an audit trail to track patient identity for things like record updates after a treatment, insurance claims, patient matching, as well as provider credentialing. Certain aspects of the data would be cryptographically hashed to a public network layer by an authorized provider, demonstrating proof of treatment, care, credentialing, or even permission. Additionally, healthcare data stored on the blockchain could serve as a pointer or secured directory to off-chain healthcare data repositories. The immutable data stored and linked on the blockchain would be an auditable source of truth for the entire healthcare process from the credentials of the doctor who performs treatment all the way to the claims process. This source of truth would also facilitate accurate transfer of records and data on private network layers, ensuring that HIPAA and GDPR compliance is met.


One blockchain protocol that is particularly well poised for this task is Factom. Factom is a blockchain protocol anchored to Bitcoin that is multi-channel enabled, has smart contract functionality, and is designed to function as an audit trail. Being multi-channel enabled means that multiple chains of data can be created within the ledger itself. In the context of healthcare, one could have different chains running in parallel: one listing credentialing for institutions on a Factom based healthcare network, one to track changes updates to a patient’s records, one for insurance claims, etc. Having a modular framework like this drastically reduces the compute cost for recording transactions and greatly reduces the amount of data created, making it a cost-effective solution compared to other smart-contract enabled protocols. The fact it is anchored to Bitcoin also means that all transactions submitted to the network are highly secure. Bitcoin’s proof-of-work blockchain is virtually impossible to corrupt due to computing power limitations. Therefore, the state of the ledgers of these different healthcare networks could be hashed to one of, if not, the most secure blockchain networks in existence right now to serve as a source of truth for healthcare data.


An area within healthcare that Factom is poised to disrupt is the Master Patient Index (MPI). MPIs are emerging as powerful tools for hospital systems to use to maintain patient data across not only their internal departments but across other independent healthcare groups. In 2018, 42% of healthcare CIOs listed patient matching as their top concern, and it’s easy to see why. As people change providers, seek treatment across a variety of providers, or move, medical records may be fragmented or incomplete and can lead to fraud, misdiagnosis, or worse. Matching patients across providers is essential and, in response, the major vendors in electronic health records (EHRs) are rolling out their proprietary MPI solutions. Unfortunately, problems still exist. First, there are several EHR Vendors. This means that although there are fewer data silos for health data, those silos still exist across EHR Vendors and gaining access to all patient data may mean purchasing access to each of the Vendors’ MPIs. This leads us to the second problem, cost. Each health system has to pay a yearly fee for access to a Vendor’s MPI, leading to high costs, especially for smaller health networks. Lastly, since the Vendor controls the MPI, they control who can use their MPI and can prevent health systems from using it if they desire. It may seem counter-intuitive to stop someone from purchasing your product but consider that nationally, there are over 250 Health Information Exchanges (HIEs) already performing patient matching at a local and regional level. By removing HIEs and centralizing control over patient data at a national level, EHR Vendor’s stand to profit tremendously. The Factom Protocol technology is well suited to serve as an MPI and since it is open source and decentralized, it limits the potential for centralized companies to control and profit using your data. In another post, we’ll get into the technical specifics of a Factom based MPI.


It’s only a matter of time before blockchain begins changing the face of healthcare and we believe the innovation is going to come through the incorporation of public blockchain networks. Time will tell, but we are strong believers that Factom has genuine potential to transform health data and healthcare. Let us know your thoughts, more blockchain articles will be coming soon! If you have any particular content you’d like us to expound upon or want to chat further, connect and let us know!

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