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Better known for its use in cryptocurrencies such as bitcoin, blockchain is a technology that allows for direct exchange of information, assets or rights between two parties; eliminating the need for intermediaries.

Transactions are time-stamped and added to a single block in an ever-growing database. Each block contains data about the transaction being made, as well as information linking it to the previous block, which in turn contains a link to the previous one and so on down the line thus forming a chain of blocks.

Blockchain places the patient at the center of the system, potentially increasing security, privacy, and interoperability of health data. For example, hospitals may have as many as 20 different ways to enter the date-of-birth of a patient. Instead, blockchain can tie patients to their data, rather than to their identity.

In 2007, the government of Estonia began a nationwide implementation of a version of blockchain. This eliminated the need for a Health Information Exchange (HIE), all-payer claims, database. By doing so the entire population became much more “health smart”.

If blockchain can create such a solid foundation of trust for accessing patient records, we might ask, ‘what does this mean for value-based healthcare?’

Trusted environment

Better data sharing between healthcare providers increases the probability of accurate diagnoses, more effective treatments, and the overall increased ability of healthcare organizations to deliver cost-effective care. Blockchain technology can allow various stakeholders in the healthcare value-chain to share access to their networks without compromising data security and integrity, by allowing them to track data origin as well as any changes made.

Data ownership has been one of the strongest concerns for the adoption and use of Electronic Health Records (EHRs). In the case of blockchain, it is the patient who owns their data and no one else.

As mentioned by a team from the MIT Media Lab in a prize-winning paper, “EHRs were never designed to manage multi-institutional, life time medical records (…)patients leave data scattered across various organizations as life events take them away from one provider’s data silo and into another.”

Traditional healthcare systems are usually complex and cumbersome from an administrative perspective. Every year mistakes are made, and patient data and billing information must be checked and rechecked for accuracy. Therefore, payment administration accounts for about 14 percent of healthcare spending.

This has created the need to take a fresh approach to data sharing in healthcare. The safety and availability of blockchain makes it an appealing choice for providers and payers that need secure access to a patient’s entire health history.

Enabling Value-Based Healthcare

Blockchain allows patients to control and manage the access of their own health history. As a result, healthcare providers do not need to store or control data and can focus on providing services and treatments to better healthcare.

“Today, patients have little access to their health data and cannot easily share with researchers or providers,” said Shahram Ebadollahi, chief science officer at IBM Watson Health. “Giving patients the opportunity to share their data securely, for research purposes or across their healthcare providers, creates opportunities for major advancements in healthcare. Blockchain technology is designed to make this a reality.”

As more and more patients gain control over their own data, EHRs will flow more efficiently across the system allowing for data to be more accurate, better access to new treatment options and ultimately improved outcomes. The system could empower patients to choose with whom, how much, and when they want to share their information; they are no longer limited to any health system.

Such improved flow of data can eventually lead to more accurate clinical outcomes and healthcare metrics. The next logical step would be to link such accuracy to payments, placing value at the center of healthcare delivery.

But looking ahead, could blockchain really be adopted by the healthcare industry?

As mentioned in an article in Harvard Business Review, the use of blockchain in health care is very early in its lifecycle, but has the potential to standardize secure data exchange in a less burdensome way than previous approaches.

The potential for value-based healthcare cannot be overstated. The healthcare industry needs an urgent fix to the discrepancies in outcomes and data, which may never occur without a system such as blockchain.

Blockchain will impact EHRs, value-based healthcare, precision medicine, medical research and many other areas. Its potential to create a standard, secured mechanism to exchange health data has just started to be realized. Want to receive the latest news and trend of blockchain in healthcare? Subscribe to our newsletter and stay tuned for the next articles.