Will Blockchain Technology Revolutionize Health Care?

Gartner named blockchain one of top 10 strategic technology trends for 2020. This year's Consumer Electronics Show (CES) in Las Vegas featured it as one of the most exciting topics of the show. If you have recently attended a tech event or leafed through a tech magazine, you probably have already noticed the buzz surrounding blockchain.

Blockchain technology illustration
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Blockchain technologies were initially introduced to facilitate money transactions. The benefit of blockchain is that transaction records are registered securely, avoiding the need for a trusted third party. Currently, Bitcoin cryptocurrency is the most well-known application of blockchain, but there are hundreds of others. New blockchain structures have been designed to support different industries, including energy, tourism, transport, and the healthcare sector.

In health care, blockchain has been praised for guaranteeing the security of sensitive data and ensuring authorized access to electronic health records. Moreover, with this technology in place, it is arguably almost impossible to tamper with data or falsify records. Nonetheless, some experts believe that blockchain is one of the most misunderstood technologies and that not all applications are necessarily realistic.

This article explores some of the most commonly mentioned uses and contributions of blockchain in contemporary health care.

What Is Blockchain Technology?

Blockchains, also called distributed ledgers, digitally record events that can be shared peer to peer. They are immutable—which means that they follow the rule of “write once and read only.” In other words, records can be added but not removed. Each block can be encrypted, and access to information is possible only with correct cryptographic keys. Therefore, blockchains are considered private. Due to cryptographic keys, there is also no need for brokers or middlemen to access sensitive data.

Blockchains are often described as “decentralized,” which means that multiple parties hold the data, and there is no overarching authority over them. Each stakeholder maintains a record of the entire corpus of information. This characteristic also implies that blockchains are somewhat protected from internal and external assaults, such as cyber-attacks. For example, the infamous cyberattack WannaCry that in 2017 affected over 200,000 computers in 150 countries (including the United Kingdom’s national healthcare system) could not have happened if a blockchain system was in place. In theory, blockchains can only be affected if attacked at multiple sites.

Mark Engelhardt, who holds a Ph.D. from Stanford University and is a partner at Ovodenovo Intellectual Property Consulting, argues that to assess the safety of blockchain technology, we only need to look at Bitcoin. Open to hackers for years, Bitcoin, an application of blockchain, remains primarily unscathed, offering some degree of confidence to future users.

Engelhardt believes that blockchain technology (in combination with application layers that are built atop the technology) could be the optimal mechanism for health care, providing users with privacy and ease of use. Healthcoin is one of the first blockchain-based platforms that focus on diabetes prevention. It’s an incentive system that tracks your biomarkers (e.g., heart rate, weight, blood sugar) and calculates your improvements in health over time. Positive results earn you “Healthcoins,” which can be used to cut your insurance costs.

Implications of Blockchain for the Healthcare Industry

Blockchain presents health care with new possibilities. Certain applications might be more realistic than others, however. Below are some examples that illustrate the potential blockchain holds.

Improving security, privacy, and reliability of data exchange and interoperability

Most progressive health technology experts believe that health records and medical data are best stored in the cloud. This enables users easier access to their data than when that data sits in silos. However, with current cloud storage standards, interoperability remains a challenge. For instance, different care providers and networks cannot always communicate with each other in a seamless way. Moreover, integrity and authenticity of records stored in the cloud remain questionable.

Blockchain is technology that could address these issues and potentially increase integrity and consistency of exchanged health information. With blockchain technology, patient information can be easily transferred between different providers and organizations. There is no need for further verification or a middleman. Instead, “smart” contracts, which are immutable through the use of blockchain, are used as a better alternative.

Creating patient-centered medical records

Generally, blockchain companies aspire towards a more patient-centered system where patients can routinely access and control their own medical data. Essentially, in this way, you own your data, and it is you that allows (or prevents) others from accessing your records. The amount of paperwork that is currently needed to comply with HIPAA standards is a strain for the doctors—a more organized and efficient system could help reduce some of this burden. However, there are still questions on how a blockchain-based system will be able to comply with HIPAA Privacy and Security Rules.

Some blockchain-based companies are working towards providing an organized, efficient system for health care. For instance, Medicalchain, a company working on blockchain for electronic health records, has focused on hospital discharge summaries. They want to ensure these medical records are free of error, quickly processed and easily transferred between different locations. Their innovative system involves a structured discharge process doctors are trained to follow. All data is decentralized, so sharing between hospitals, health insurers, and other stakeholders is easier than traditional approaches.

Medicalchain is also building a blockchain-based system that could be applied internationally. For example, if you received treatment outside of your country, this system would enable simple sharing of your medical records and other important personal information with a global provider of your choosing.

Minimizing Fraud Related to Prescription Drugs

Prescription drug fraud is a big challenge. Fraudsters use various techniques to cheat the healthcare system—from photocopying prescriptions to “doctor shopping” to get as many original prescriptions as possible from different doctors.

Blockchain company Nuco, which is now the Open Application Network – Aion, came up with a novel solution for this problem. It involves equipping prescriptions with a machine-readable code that is associated with a block of information, such as the name of the drug, its quantity, and a timestamp. A pharmacist needs to scan the code (for example, by using a smartphone) and the prescription is compared against the blockchain. In this way, the accuracy of prescription can be checked immediately.

Different stakeholders are expected to take part in this fraud-prevention scheme, including insurance providers, hospitals, and pharmacies. Each of these parties can only access the information to which they are entitled. (Specific data is accessed providing the correct cryptographic keys, which helps ensure patient privacy.)

Tracking and Preventing the Sale of Counterfeit Drugs and Devices

Many people around the world do not have access to high-quality drugs. Moreover, drugs and medical devices sold in the developing world are sometimes an imitation of the original. A blockchain-based system could make the healthcare supply chain more transparent and provide all parties with a sound tracking system, tracking a legitimate product’s delivery from the manufacturer to patient.

This type of oversight would have a dramatic impact on counterfeiting. In 2020, IBM, KPMG, Merck, and Walmart participated in a pilot program to study blockchain effectiveness in tracking prescription drugs and vaccines through the FDA's U.S. Drug Supply Chain Security Act (DSCA). Through the simulations, the participants estimated they could verify a product's status in just a few seconds, rather than the usual timeframe of up to three days.

Improving Clinical Trial Records and Medical Research

A review published in The BMJ highlighted that many clinical trial results never get published. In fact, the analysis showed that on average, only 36 percent of study results get disseminated within two years of the study's completion. Especially negative results often get ignored. If not resolved, this will continue to have a significant impact on the betterment of medicine, not to mention medical research and clinical practice.

Blockchain-enabled records of medical trials (as well as their results) could help move medical research in the right direction. With immutable study records in place, the risk of ignoring data through selective reporting could potentially be minimized. Some experts also argue that collaboration between participants and researchers is likely to improve with an open blockchain system. Furthermore, storing large data sets and sharing them could become easier. In this way, researchers from around the world would have access to study results. Researchers could correlate prior studies with their own data, which has the potential to increase global collaboration.

Blockchain and the Dental Industry

Dentacoin is an example of a blockchain-based initiative used within the dental community. It is a cryptocurrency that can be either earned or bought. For example, patients are rewarded “Dentacoins” for leaving a review about a dental provider and can potentially use the Dentacoin reward for dental services. Purportedly, some dental clinics are already accepting this currency.

If your dental provider is a participating partner, you can set up a contract with them to set up the terms of service.

Advantages and Risks of Using Blockchains in Health Care

Although blockchain technology is inspiring a lot of excitement, we should not forget that this technology is only a tool. For instance, information that is put onto a blockchain is not necessarily accurate or of high quality. To benefit fully from this novel technology, some diligent planning is required, both at the technical level as well as the administrative level. Also, by giving more power and control over medical records to users, we also need to ensure that they receive sufficient education so they become comfortable with this new technology.

At present, many blockchain innovations discussed are still in their alpha or beta stage. Experts warn that it is essential these new products are not pushed out too early in the market. We are only just learning how to navigate blockchain technologies. Nonetheless, blockchain holds great promise to evolve our healthcare system, and it is expected to contribute to a safer and more patient-centered healthcare system.

4 Sources
Verywell Health uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Engelhardt MA. Hitching healthcare to the chain: An introduction to blockchain technology in the healthcare sector. Technology Innovation Management Review. October 2017;7(10):22-34.

  2. Donovan F. Healthcare Blockchain Projects Need to Factor in HIPAA Compliance. HIT Infrastructure. January 9, 2019.

  3. Treshock M. How the FDA is Piloting Blockchain for the Pharmaceutical Supply Chain. IBM. May 4, 2020.

  4. Chen R, Desai NR, Ross JS, et al. Publication and reporting of clinical trial results: cross sectional analysis across academic medical centers. BMJ. 2016;352:i637. doi:10.1136/bmj.i637+

Additional Reading

By Michael Rucker, PhD, MBA
Michael Rucker, PhD, MBA, is the vice president of technology for Active Wellness.