Blockchain Set to Transform the Healthcare Industry
As blockchain-based pilots and projects continue to roll out, many estimate the technology’s impact on the healthcare industry will be substantial. Use-cases range from supply chain management for pharmaceutical authentication to providing interoperability between medical systems and information.
While there are still some concerns held among healthcare executives, industry adoption of the technology is certain. The use of blockchain reduces overhead time and costs, provides a decentralized medium for dynamic interoperability, various payment solutions, improves data security, offers license and pharmaceutical authentication, and is a regulatory aid for the healthcare industry.
According to a recently released BIS Research report, blockchain technology could save the healthcare industry up to $100 billion per year by 2025. It predicts the exchange of data will contribute the most to the savings related to blockchain, or distributed ledger technology (DLT) – “Blockchain can help solve the most widespread problem in healthcare IT systems related to interoperability and non-standardization that has created data silos in the industry”
Recently, J.P. Morgan estimated blockchain technology could help medical entities save up to 80% of the current cost and time associated with credentialing physicians. An article in Medical Economics supports this take, stating, “Medical staff credentialing can be a costly and time-consuming effort conducted via phone calls, faxes, and snail mail. Because blockchains can be verified and updated incrementally, the technology may be well suited for the credentialing process.”
Medical Economics, additionally, notes the potential blockchain offers the healthcare industry as a solution for meeting Drug Supply Chain Security Act (DSCSA) compliance. In 2012, Congress created DSCSA by expanding the U.S. Food and Drug Administration’s (FDA) oversight through the Drug Quality and Security Act (DQAS). The law, additionally, “outlines a 10-year plan for developing an electronic, interoperable system to identify and trace prescription drugs as they move through the U.S. supply chain.” Because of these requirements, the authors of this piece suggest the following:
“The system essentially mandates a blockchain-like verification system whereby drug supply chain stakeholders are required to verify upstream information about a product (e.g. who manufactured the product, when it was sold, who it was sold to, etc.) and provide downstream information (e.g. passing along the same information to the next entity in the chain).”
Becker Hospital Review provides a concise summary of the outlook for blockchain in healthcare. The article states blockchain in the healthcare market is predicted to exceed $890 million by 2023. Among the various use-cases, the most growth is expected to come from “clinical data exchange and interoperability.” As well, as blockchain’s association with “improved data security and integrity” increases, so should the technology adoption rate. And lastly, the Asian-Pacific region is predicted: “to be the fastest growing in the market, with a CAGR of more than 70 percent through 2023.”
Where is the Industry, Currently?
Blockchain is well within the research and development phase as healthcare companies’ pilot and test more DLT-based solutions. An article by Irish Tech News provides a comprehensive list of many of these projects. Here are just a few of them:
The Arizona Care Network (ACN), a group of 5,500 healthcare providers in Arizona, adopted a blockchain solution to “address those administrative burdens” associated with providers and patients. Their latest move involved using the healthcare blockchain network Diabetes Care Administration Network to “manage the care of their 25,000 type 2 diabetes patients.”
On April 25, 2019, the U.S. Food and Drug Administration approved a “multi-regional pilot studying the use of blockchain-enabled data technology to track and verify specialty prescription drugs, to ensure safety, enhance value and improve health outcomes.” The press release specifically states that the pilot is intended to “test implementation of the Drug Supply Chain Security Act (DSCSA), starting August 2019.” Interoperability between healthcare systems in North Carolina, Indiana, and Tennessee will be tested as the focal point of this pilot.
In February of this year, Cigna and Sentara Healthcare joined a blockchain-based network which includes Aetna, Anthem, Health Care Service Corporation (HCSC), IBM, and PNC Bank. The group of companies will explore blockchain solutions for “promoting efficient claims and payment processing, enabling secure and frictionless healthcare information exchanges, and ways to maintain current and accurate provider directories.”
Pricewaterhouse Coopers (PwC) released survey data in 2018 which can provide insight into some of the concerns companies had before entering many of these new trials. When asked the question, “Which of the following will be the biggest barriers to blockchain adoption in your industry in the next 3-5 years?” the companies responded as such:
47%- Lack of trust amongst potential users
39%- Regulatory Uncertainty
37%- Ability to bring the network together
36%- Blockchain interoperability
33% Inability to scale
Additionally, 31% of the companies polled by PwC stated that “cost was the primary reason their organization had not progressed further with blockchain.”
One Step at a Time…
The ‘final thoughts’ section of the PwC report states that both the adoption and realization of the benefits of the technology begins with “small steps.” At this point in time, many steps surely have been taken. To date, blockchain projects and pilots and being tried in the healthcare industry. But there are still many steps left on this journey.
While one can generally outline the various benefits of blockchain technology for healthcare – interoperability, security, authentication, supply chain tracking, payment systems- there is no telling how it will, ultimately, reshape the industry and other associated industries. At this point in time, however, blockchain technology is already being adopted or piloted and is expected to soon reshape the healthcare industry.