Why Blockchain Technology is Disrupting the Healthcare Industry

Healthcare records, as of now, remain disjointed because of the lack of common architectures and regulations that permit the safe transfer of data between stakeholders.  For example, an updated patient’s clinical data is stored in a database within the hospital or within a defined network of stakeholders.

As a paradigm shift in information distribution, Blockchain technology’s potential in healthcare can be groundbreaking.  Imagine a limitless database, with centralized ownership, where all members cryptographically add, manage and access data. When new data is added all the members on the network are notified.  For patients, this can be their latest medical diagnosis.

To drill down to the specific case of a hospital, Blockchain technology offers an easy way to manage patients’ records where multiple entities are involved.  If a patient, for example, decides to continue his treatment in a different place, the original hospital records need to be electronically transferred or carried as physical documents by the patient and this could be cumbersome and data could be outdated. However, Blockchain, behaving as a single source of truth, would allow the healthcare provider anywhere to have an immediate and accurate view of the patient’s current medications.

The above is only a small example of where Blockchain can benefit the healthcare industry.  There are several areas where it can make a positive impact such as clinical data sharing, public health information, clinical trials, administration and finance departments and patients’ personal data.  To elaborate, Blockchain-enabled IT systems can make a huge difference to clinical data exchange, but on a more transactional level, it can help with claims and billing management.  Research indicates that nearly 5 to 10 percent of healthcare costs are fraudulent and in the year 2016 this resulted in a loss of $30 million in the United States.  By automating the claims and payment processing activities, healthcare companies can reduce administrative expenses.

While the healthcare industry is beginning to acknowledge Blockchain’s power, many fear that the technology’s strength could itself be its Achilles’s heal, i.e. its decentralized approach places it in a position of security vulnerability.  Secondly, Blockchain works on the principal of unique identifier links. If the same person has multiple IDs then this duplication needs to be managed before it can be added to the blockchain.

Related: What you need to know about leveraging Blockchain technology for the healthcare industry

But these transactional challenges can be tackled and technology companies are already working on coming up with solutions.  The believers, for example, say that Blockchain actually helps to enhance security and reliability.  As per the Protenus Breach Barometer report, there were nearly 450 health data breaches in 2016 affecting over 27 million patients.   It is also estimated that 27% of the breaches were caused by hacking and ransomware.  The believers say that with the growth in IoMT (Internet of Medical Things) ecosystems, Blockchain-enabled solutions will not only bridge the gap of device data interoperability, it will also be more secure. For example, hacking one block in the chain is impossible without hacking every other block in the chain’s chronology.


The blockchain is based on open source software, commodity hardware, and Open APIs.  These components ensure faster and smarter interoperability and help to reduce the burden of handling large volumes of data.  By using industry standard data encryption and cryptography technologies, health care companies can ensure compliance and security. Blockchain data structures can support a wide variety of data sources including patients’ mobile devices, wearable sensors, EMR’s and so forth.  With built-in fault tolerance and disaster recovery, data remains protected.

To summarize, Blockchain technology has carved a niche place for itself in the healthcare IT ecosystem and in the future, Blockchain could remove all blocks in the way of advanced precision healthcare.