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Introduction

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Blockchain not only has the potential to impact the healthcare industry -- it might even transform the sector some day. But it's still early in the process of adoption. And as with other industries, the true influence of blockchain on how health services are provided, billed for, paid for, and managed has yet to be determined.

Also: Health tech: AI, APIs, and data interoperability

Defined as a "single version of the truth" made possible by an immutable and secure time-stamped ledger, copies of which are held by multiple parties, Blockchain is viewed by many as a game-changing method of conducting transactions.

An industry that deals with digital transactions involving medical records, patient data, and other sensitive information certainly needs ways to better protect the integrity and security of those transactions. Is blockchain the answer?

How blockchain might impact healthcare

Blockchain technology can potentially transform healthcare, putting the patient at the center of the healthcare ecosystem and increasing the security, privacy, and interoperability of health data, according to a report by consulting firm Deloitte Consulting LLP.

Also: Electronic health records: A cheat sheet for professionals

This technology "could provide a new model for health information exchanges by making electronic medical records more efficient, disintermediated, and secure," the report said. "While it is not a panacea, this new, rapidly evolving field provides fertile ground for experimentation, investment, and proof-of-concept testing."

Blockchain-based tools can reduce or eliminate the friction and costs of current intermediaries, the Deloitte study said. They can help connect fragmented systems to generate insights and to better assess the value of care. In the long term, a nationwide blockchain network for electronic medical records might improve efficiencies and support better health outcomes for patients, the firm said.

Some experts are skeptical about blockchain's role in healthcare.

"There are very few true proof points yet," said Martha Bennett, principal analyst at Forrester Research. "There's a lot of talk about the 'what', very little about the 'how', in particular when you look at scaled-out, operationalized processes. And hardly anybody talks about key management, which will be a challenge."

For many of the proposed healthcare use cases of blockchain, "the real issues have nothing to do with technology, and everything with market structure, vested interests and politics," Bennett says. Projects are in the very early stages, mostly proof of concept], she said. There are some limited deployments, the most promising of which augment existing processes.

Promising use cases

Adding transparency to processes, whether it is claims, drug prescribing, etc., is a key area where blockchain could apply, Bennett said. "Clearly, for this to be successfully, you need ecosystem partners willing to collaborate," she said. "You also need to address the challenge of balancing transparency with confidentiality."

Also: Blockchain: The end of banking as we know it?

A good use case, and one that has fewer issues with confidentiality, is any type of reference data such as healthcare provider information.

Tracking of returned medicines is also a promising use case, in particular if regulation prevents the industry from running a centralized system.

There are two inherent challenges with health data that blockchain can help solve, said RJ Krawie, principal, customer strategy, and applied design at Deloitte. One is that health data is often sensitive and needs to be kept private, and only shared in certain circumstances. The other is that there are advantages to having more data when assessing a current problem or health state.

"Blockchain can help by creating a secure way to electronically hold health data, and allow a person to control who sees it and who doesn't," Krawie said. "It also facilitates tracking health data, and every heath interaction throughout that person's entire life, giving them the benefit of the maximum possible amount of data when making a health determination."

Blockchain provides a more secure method of data storage, and in a sense is a better "lock," Krawie said. "Many of the cyber security techniques are put in place to stop humans from unwittingly sharing the data," he said. "People will still be tricked into giving the wrong access to the wrong people."

Can blockchain enable nationwide interoperability?

The Deloitte report noted that the Office of the National Coordinator for Health Information Technology, a division of the Office of the Secretary within the US Department of Health and Human Services (HHS), issued a shared nationwide interoperability roadmap that defines critical policy and technical components needed for nationwide interoperability.

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These components include ubiquitous, secure network infrastructure; verifiable identity and authentication of all participants; and consistent representation of authorization to access electronic health information. But current technologies don't fully address these requirements, the Deloitte report said, because they face limitations related to security, privacy, and full ecosystem interoperability.

Blockchain might help address these limitations, but it's not fully mature today, the report said. Several technical, organizational, and behavioral economics challenges must be addressed before a healthcare blockchain can be adopted by organizations nationwide.

The future of blockchain in healthcare

Blockchain technology creates unique opportunities to reduce complexity, enables trustless collaboration, and creates secure and immutable information, the Deloitte report said.

Also: 5 ways technology will change the future of healthcare (TechRepublic)

"HHS is right to track this rapidly evolving field to identify trends and sense areas where government support may be needed for the technology to realize its full potential in healthcare," the report said. "To shape blockchain's future, HHS should consider mapping and convening the blockchain ecosystem, establishing a blockchain framework to coordinate early adopters, and supporting a consortium for dialogue and discovery."

While there is not yet an existing technology solution to protect all medical data, enabling efficient and safe data exchange, it is possible and likely coming, Krawie said. "Blockchain isn't a magic cure-all," he said. "Blockchain can help with secure transfer of medical data, but won't on its own solve some of the other problems with interoperability, like data quality and integrity."

In the end, whether blockchain will dramatically disrupt healthcare remains to be seen. "No technology can do that," Bennett said. "But blockchain-based networks can help shake up the industry if ecosystems decide to collaborate and change the way things are done--while of course maintaining regulatory compliance."

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