More than a buzzword: How this ACO is adopting blockchain technology

Blockchain became part of the average American's lexicon a year and half ago when the price of one bitcoin surged to $13,800. Today, the price for a bitcoin is down nearly 60 percent, at $5,407. But that doesn't mean blockchain — the technology behind bitcoin — doesn't have immense potential.

Between the financial, healthcare, retail and supply chain industries, C-suite executives are implementing blockchain at different paces. The financial industry has often been regarded as a leader in blockchain, with banks like JPMorgan Chase and Bank of America investing big bucks in the decentralized ledger.

Healthcare is beginning to catch up. Phoenix-based Arizona Care Network, an ACO, is among the few healthcare organizations to implement blockchain tools.

"Last year, Arizona Care Network and Solve.Care Foundation were first in the healthcare industry to launch a provider rewards program built on blockchain technology," David Hanekom, MD, the CEO of the ACO. "Our goal was to relieve administrative burdens, reduce waste in the system and improve healthcare outcomes."

The mobile app, called Care.Wallet, is built on the blockchain and  used by physicians at ACN. It displays relevant patient data for providers as well as financial rewards physicians can earn for improving quality and keeping costs down. The ACO plans to launch Care.Wallet for patients, which automatically synchronizes patients' benefit information, including deductibles and copays, co-insurance and out-of-pocket expenses, into the blockchain. Patients can also use the blockchain to obtain immediate authorization, schedule appointments and share benefits information.

Here, Mr. Hanekom dives deep into the healthcare organization's blockchain use and gives his thoughts on whether the decentralized ledger can improve the $3 trillion annual healthcare spend.

Note: Responses were edited lightly for length and clarity.

Question: How are you using blockchain technology within your ACO? 

Dr. David Hanekom: Last year, Arizona Care Network and Solve.Care Foundation were first in the healthcare industry to launch a provider rewards program built on blockchain technology. Our goal was to relieve administrative burdens, reduce waste in the system and improve healthcare outcomes.

The ACN Care.Wallet is a mobile app that employs blockchain technology, cloud computing and cognitive learning capabilities that gives our providers anytime access to the quality metrics that matter most, enabling them to act. On a provider's personal device, they can view their performance data, compare their success with others in the network and redeem financial rewards.  The data displayed is both transparent and actionable.

This is phase one. We already have a Care.Wallet in development for patients and families. That platform will display an identification card that verifies that the patient is eligible for services from our network. As we partner with payers, we'll add immediate verification of patient eligibility, eliminating the need for practice staff to call the payer while the patient waits. It also will drive price transparency because the data in each wallet is specific to that individual's coverage, including current deductibles, co-pays and out-of-pocket costs. This drives significant patient satisfaction. The ability to communicate care gaps, post reminders for health screening or protocols for their medical condition and suggest wellness activities all help patients take charge of their own health and improve their outcomes.

Q: Where is blockchain at in healthcare? 

DH: Although we are just beginning to apply blockchain in healthcare, we are already seeing tremendous benefits. The beauty of blockchain technology is that is allows for true coordination of care administration and enables organizations like ACN to have direct interaction among patients, insurers and providers. This will help improve patient outcomes and reduce or eliminate the cost of duplication, inefficiency, waste, abuse and fraud from the system.

Q: What would you tell other ACOs and hospitals looking to integrate blockchain? 

DH: Blockchain can make a real and measurable impact in helping providers and hospitals achieve the Quadruple Aim: improve population health, reduce total cost of care, improve the patient experience and drive provider satisfaction. This is particularly true in the age of value-based medicine, where to be successful, organizations need immediate access to actionable health data.

A case in point is the ACN Care.Wallet, which creates, stores and shares administrative and financial records via a network of personal devices that do not rely on a central entity to control the data. Information is updated to all parties in the "chain" in real time, so doctors' offices can use the application to check patient eligibility and benefits details, coordinate care across parties and locations, and eliminate delays in payer reimbursement. 

Q: Where do you see blockchain's potential in healthcare in the next 5 to 10 years? 

DH: In my view, blockchain technology has the potential to revolutionize the healthcare industry. Consider that administrative costs in the industry account for between 7 percent and as much as 30 percent of the more than $3 trillion annual healthcare spend. Blockchain can automate much of an archaic claims and payment systems that are expensive and resource-intensive, improve coordination of care, and create a permanent record of online transactions that can be securely stored and selectively shared with targeted users via a network of personal devices.

In the case of the ACN Care.Wallet, we even foresee this as one way to improve the revenue cycle by reimbursing providers more quickly and reducing the number of unpaid claims due to

verification issues discovered long after care has been delivered. I know of no other industry that will deliver services in good faith on a promise to receive all, or perhaps part, of the bill from a third party at some point in the future. The result of this archaic system is a huge burden that requires independent doctors to hire staff and jump through onerous administrative hoops to get paid.  This takes them away from their first passion, which is listening and talking with patients and providing clinical care —and it drives up costs within our healthcare system.

Q: Is blockchain more than just a buzzword? 

DH: To think about the positive, lasting impact of blockchain technology, one need only look at the financial services industry. Initially used to lower the worldwide cost of cross-border payments, security trading and compliance, blockchain technology now has the potential to save the banking industry an astounding $20 billion by 2022, according to estimates by the management consulting firm Accenture.

The healthcare industry stands to reap similar benefits. Think of how blockchain could give patients access to providers, help them understand their benefits and the cost of treatment, and eliminate duplicative paperwork associated with insurance billing and payments.

Blockchain technology also can give providers a 360-degree view of a patient's care, enabling an entire medical team to communicate, coordinate and eliminate unnecessary tests and procedures that drive up healthcare costs.

This is the kind of focused application of technology that I strongly believe will empower both the patient and physician to make better collaborative decisions to improve health and drive sustainability into our healthcare system.

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