Important qualities including immutability, decentralization, and transparency make distributed ledger technologies such as blockchain the best approach to solving a number of routine business problems in healthcare.
While it’s wise to keep in mind that blockchain can’t solve every problem in healthcare IT, one doesn’t have to buy all the hype to appreciate the pain points where blockchain can make a difference: a lack of data sharing in real-time across multiple parties, insufficient transparency, difficulty in determining the provenance of data and inadequate security.
So-called “smart contracts,” which implement the terms of a contract in computer code, help to unlock much of blockchain’s value in healthcare. With smart contracts, business users are able to settle transactions between multiple entities with no need for a central source of authority or external enforcement mechanism. This is due to smart contracts’ inherent capability to represent an agreement’s business and legal rules in code via a shared, decentralized distributed ledger.
Through smart contracts, blockchain enables healthcare organizations (HCOs) to add transparency, security and speed to several business process that are often tedious, manual and error-prone. Below are use cases demonstrating how blockchain can improve four common business process in healthcare.
Payer-provider data sharing: As value-based contracting arrangements increasingly require payers and providers to collaborate around data sharing, interoperability issues that have long prevented effective exchange of clinical and claims data take a heavier and heavier toll on patient care. Frequently, interoperability problems create significant challenges for multiple HCOs to view and share patient data while at the same time maintaining a comprehensive and up-to-date record of a patient’s diagnoses, medications and treatments.
By functioning as a single source of truth via a shared ledger, blockchain allows all permissioned participants in the care delivery process to continue using their own information systems while also sharing patient records. This shared ledger acts as a real-time master record of all updates made to a patient record by all participants.
Revenue cycle management (RCM): Sometimes healthcare moves a little slower than other industries, and RCM is a notable example. In our industry, billing and payment processes often require months to resolve as HCOs quibble over various disagreements that result from a lack of real-time information at the point-of-care, including ambiguity over patient eligibility or financial responsibility.
The result of these disagreements for providers is often a claim denial, a costly problem that is preventable, yet still frustratingly prevalent. Through smart contracts, blockchain provides a way to reduce the burdens of slow payment and denied claims common to the RCM process.
By enabling HCOs to exchange at the point-of-care important patient and payer information – such as eligibility, benefits and contract rates – blockchain can complete before the patient leaves the office tasks that may require months through the traditional RCM process.
Referral management: Referrals to and from providers often involve a series of manual steps that consist of phone, e-mail and text communications, which can divert staff and resources from patient care. This laborious process too-often results in errors, delays in patients receiving care, unscheduled appointments, duplicative tests and burned-out providers and staff.
Most of the problems associated with referrals stem from communication issues, which can largely be alleviated by automating the referral process. Due to its ability to facilitate secure, real-time data exchange between disparate parties, blockchain represents an ideal technology for automating the process, which will lead to fewer errors and discrepancies.
Blockchain enables real-time access to patient information for each key player in the referral process – such as providers, payers, staff and care team members. All participants receive alerts when changes are made to a patient record, enabling physicians to know whether their patients have obtained prescribed treatments, medications and tests. Real-time information on referrals also helps provider groups better manage network leakage.
Supply chain management: Similar to its effect on referrals, blockchain’s ability to deliver real-time information to multiple parties makes it the ideal technology for supply management, providing greater transparency into provenance and chain of custody.
Consider the example of clinical trials, which require complete traceability across the lifetime of the supply chain. Clinical trials often involve the collection of myriad biological samples from multiple sites over a lengthy time period, creating complications like excessive manual data entry work, frequent opportunities for error and difficult end-of-study reconciliation.
The supply chain management industry today lacks technology that provides a single-source, real-time record of all transactions, according to a recent Accenture report about “how blockchain will simplify and transform the supply chain.” Through blockchain, a “master ledger” can be created that reduces processing costs by offering a single, authoritative real-time view to all supply chain participants (manufacturers, intermediaries and customers), enhancing confidence and trust in the system.
Early days, but lots of promise
Even as a true believer in blockchain’s potential to improve healthcare, I have to admit that some of the hype around this new technology goes too far. (For example, blockchain is ideal for facilitating the sharing of electronic medical records but is not a replacement for EMR systems.) However, it’s important that we don’t allow the inevitable anti-blockchain backlash to distract us from the benefits that distributed ledger technology has to offer.
While it’s still early days for blockchain, several use cases – including those above – are beginning to come into focus to illustrate how it can lower costs and improve outcomes in the healthcare system. None of us can say exactly where we’re headed with this promising new technology, but it’s almost certain to be an exciting journey.