The healthcare sector is fast catching up with the digital revolution. Some of the trending hashtags in the healthcare space are #3DPrinting #BigDataAnalytics #BioPrinting and #ArtificialIntelligence, with #Blockchain being one of the favorites.
Now, let’s take a look at how blockchain technology has been opening up avenues for investors who are keen on betting on the healthcare space. Blockchain’s Claim to Fame
Blockchain came into the limelight as the underlying technology for the most popular cryptocurrency — Bitcoin.
An article on Investor’s Business Daily has defined blockchain technology as a shared public ledger, also known as a distributed database, which tracks and records transactions in a transparent and tamper-proof way.
The estimates for the uptake of this technology are mind-boggling. Deutsche Bank Aktiengesellschaft
DB expects blockchain systems to record transactions for about 10% of worldwide GDP by 2027. Furthermore, Gartner Group believes blockchains have delivered $4 billion in business value-add or technology innovation in 2017, with that likely to swell to $21 billion, $176 billion and $3.1 trillion by 2020, 2025 and 2030, respectively (per the article on Investor’s Business Daily). Blockchain and Healthcare
Given the rising need for integrating data across plans and providers, the Healthcare sector is poised to gain the most from blockchain’s distributed ledger technology. This hi-end technology has the power to revive the healthcare industry by reorganizing operations, generating new business models and integrating patients’ medical records.
On Apr 2, leading health care companies like Humana (
HUM Quick Quote HUM - Free Report) , MultiPlan, Quest Diagnostics DGX and UnitedHealth Group’s UNH Optum and UnitedHealthcare formed an alliance to launch a pilot program on this revolutionary technology. This program will study how the technology can be applied to cut down costs related to data management along with enhancing data quality and accuracy.
In February, a Medicalchain ICO project, leveraging on the blockchain technology to maintain health records, was launched. Medicalchain allows different organizations like doctors, hospitals, laboratories, pharmacists and health insurers to seek permission for accessing a patient’s health record and store these transactions on the distributed ledger.
3 Major Factors Driving the Blockchain & Healthcare Integration
Systems for recording and managing medical data are slow, centralized and often extremely vulnerable. This in turn leads to a chain of issues that are adversely impacting overall healthcare services. Let’s discuss such problems in detail.
Escalating Administrative Costs
Doctors, hospitals and diagnostic information service providers, all have been shelling out roughly $2.1 billion every year to manage and hold records of healthcare provider data.
We take a note that, recently a major alliance has been formed between Amazon.com, Inc.
AMZN, Berkshire Hathaway Inc. (BRK.B) and JPMorgan Chase & Co. JPM. The corporate behemoths came together to put a check on spiraling medical treatment costs by forming an independent health care company for employees in the United States. Medical Error — Leading Cause of Death
U.K.-based publisher of medical journals and clinical research, BMJ stated in a 2016 podcast that around 250,000 deaths every year in the United States are caused by medical errors (per an article on Crypto Currency News). The blockchain technology gives providers instant and complete access to a patient’s medical records.
Growing Need to Strengthen Data Security
There is a growing need for healthcare organizations to prevent data hacking and phishing while maintaining confidentiality of patient’s health information. In this regard, a Cognizant research report states that around 49% of respondents in a survey stated that the transparent and tamper-proof nature of the transactions stored using the blockchain technology platform helps enhance customer satisfaction.
Challenges Impeding the Transition
Since blockchain is a relatively new technology, it indeed is a challenge for key decision makers to understand its functionality and applicability.
One of the most common problems faced by adopters of this technology is to maintain and streamline operations between different blockchains. Complicating the situation is the availability of various networks, each with different market strategies and structures. These networks are continuously competing to become the TCP/IP standard for blockchain. Per a Cognizant report, 62% of the respondents have cited this issue as a major bottleneck.
Legal and regulatory issues also make adoption of this technology tough. Per a Cognizant report, healthcare payers and providers need to comply with the Health Insurance Portability and Accountability Act (HIPAA) standards for governing the privacy and availability of Protected Health Information which impedes the uptake of blockchain.
Blockchain technology holds immense potential to completely alter the healthcare space by addressing the key issues plaguing it.
In the words of Nasdaq CEO Bob Greifeld, blockchain “is the biggest opportunity set we can think of over the next decade.”
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