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Blockchain Technology in Healthcare: Disruptor or Fad?

July 11, 2018

Among emerging technologies, blockchain technology probably ranks somewhere near artificial intelligence and machine learning in the level of discussion being generated about its potential to revolutionize health information technology and the sector itself.  An IBM survey reported that 16 percent of 200 surveyed healthcare executives had plans to implement a blockchain solution in 2017 and that 56 percent expected to by 2020.  This eAlert offers a brief look at what has been described as possibly the most significant IT disruptor since the internet, as well as a glimpse of some of its potential uses in healthcare and medicine.

First, what is blockchain technology?  As a white paper by Deloitte describes it:

At its core, blockchain is a distributed system for recording and storing transaction records.  More specifically, blockchain is a shared, immutable record of peer-to-peer transactions built from linked transaction blocks and stored in a digital ledger.  Blockchain relies on established cryptographic techniques to allow each participant in a network to interact (e.g. store, exchange, and view information), without preexisting trust between the parties.  In a blockchain system, there is no central authority; instead, transaction records are stored and distributed across all network participants.  Interactions with the blockchain become known to all participants and require verification by the network before information is added, enabling trustless collaboration between network participants while recording an immutable audit trail of all interactions.

Blockchain technology’s potential as a game-changer stems largely from its decentralization.  Unlike the current healthcare system, which revolves around a multitude of centralized systems managed by intermediaries, such as electronic health record companies, “the blockchain flips that on its head and says, instead of centralizing, let’s create a decentralized, distributed, global data repository for the entire industry that’s basically shared by everyone and controlled by no one.  Rather, it’s controlled by everyone, so major participants who are participating in this blockchain also serve to secure and protect it,” Micah Winkelspecht of blockchain startup Gem explained in Healthcare Dive.

In short, think potentially unprecedented levels of interoperability and data exchange, privacy, security, transparency, patient access to their medical histories, and opportunities for research, collaboration and real-time information-sharing.  Blockchain’s inherent decentralization could have major implications, for example, for the privacy and security of electronic protected health information (ePHI).  Under current models, exposure of ePHI to ransomware or hacking puts all of the provider’s ePHI at risk because all of it is stored in a centralized place.  Blockchain’s decentralization and use of cryptography in creating “chains” of data “packets”—permanent, time-stamped records that are impervious to tampering after the fact—could address a major problem plaguing the industry. 

“The great advantage of BCT [blockchain technology] in the health arena is that it allows development of a stable and secure data set with which users can interact through transactions of various types,” a group of Madrid-based medical researchers wrote in a review article, “How Blockchain Technology Can Change Medicine,” published in the May 2018 issue of Postgraduate Medicine.  These interactions could encompass everything from research and electronic medical records to data analytics and big data, teaching and payment for medical services.

Clearly interested in blockchain’s potential for healthcare, the federal government invited the private sector to share ideas in a white paper competition sponsored by the Department of Health and Human Services and the Office of the National Coordinator for Health Information Technology.  Among the competition’s winners were papers exploring use of blockchain to:

  • Create a peer-to-peer network for jointly storing and analyzing data with complete privacy, to empower precision medicine clinical trials and research.
  • Support existing healthcare business processes, improve data integrity and enable at-scale interoperability for information exchange, patient tracking, identity assurance and validation.
  • Develop a platform to improve claims processing.
  • Produce a decentralized electronic health record management system that encompasses authentication, confidentiality, accountability and data sharing.
  • Foster the development of Patient Reported Outcome Measures (PROM) in conjunction with the Internet of Things (IoT), including wearable devices.
  • Link ePHI with blockchain identities and blockchain identities with verified provider institutions to create a “health information exchange of one,” that lowers transaction costs while enhancing security.
  • Assist healthcare organizations participating in alternative payment models in developing IT platforms that would help link quality and value.

Despite the interest in potential blockchain solutions like these, unanswered questions and concerns remain.  In the realm of health information exchange and interoperability, for example, those concerns include ways to mesh blockchain systems with HIPAA regulations and control access to patient ledgers, and whether patients should be identified by name (a potential HIPAA violation) or by a national patient identifier, which is currently not available.

“It may never happen that digital ledger technology is going to replace current infrastructure, because of the regulations,” said Joe Guagliardo, chair of the Blockchain Technology Group at the Pepper Hamilton law firm, in Health Data Management.

In addition, in testimony before a House joint subcommittee, Chris Jaikaran, a cybersecurity policy analyst in the Government and Finance Division at the Congressional Research Service, said that although blockchain is technically feasible for increasing interoperability and sharing of medical information among providers who are caring for a patient, “all the providers have to be on the same blockchain, so they all have some kind of identity—a public and private key—and users have to take a more active role in managing that record for themselves.”  Also inhibiting the technology’s adoption are the lack of standards for blockchain technology and the need for any blockchain-based electronic health records solutions to comply with federal and state laws, he said.

Other hurdles include the costs of setting up blockchain systems; the shortage of blockchain developers, which could further drive up costs; and the risks associated with implementing a relatively untested technology.  Still, at this point, the possibilities seem enormous and indications are that the buzz surrounding blockchain in medicine and healthcare is warranted.  We will be interested in seeing how the technology unfolds.


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