The rate of technological change, combined with shifting customer preferences and an evolving regulatory landscape, always had a dramatic implication for service industries, including financial and healthcare. In recent times, if there is one technological innovation which has shaken the financial world, it is the arrival of digital currency (Bitcoin). Rather than relying on a government, bank, or intermediaries, the Bitcoin system is made of individual users and its objective is to have a decentralized financial system and to break the system’s dependence on a few elite global decision-makers.
Although bankers raised doubts about the Bitcoin concept, the underpinning technology (blockchain) is somehow seen by many banks as useful. Blockchain works like a huge decentralized ledger for the digital currency, Bitcoin, which records every transaction and stores the information on a global network such that it cannot be tampered with. It is this technology that banks feel can be utilized in many areas even without the adoption of digital currency.
The biggest advantage comes in the form of creating a completely transparent system as it is shared among a large number of users allowing users to be viewed and verified by anyone using the system. The second advantage blockchain brings is the reduction of risks which the traditional payment methods present. The no chargebacks feature, transparent system with fewer fraud possibilities, and zero possibility of erasing the traces of digital transactions presents a distributed ledger technology with reduced risk.
By providing complete transparency and scalability with reduced counterparty risk and improved operational efficiency, thereby proving beneficial for all stakeholders involved, major banks like Standard Chartered, JPMorgan, Barclays, HSBC, Bank of America, State Bank of India, ICICI Bank, Axis Bank, Kotak Mahindra Bank, and Singapore’s DSB Group are all experimenting with blockchain for insurance/trade finance/mortgages and other areas.
Despite the fact that blockchain technology is fundamentally changing the financial services industry and has gained wider acceptance in the fintech industry, there is strong evidence that it could transform business, government, and society, including the healthcare industry in perhaps even more profound ways. The healthcare industry is genuinely excited about the possibilities presented by blockchain and has started to explore both relatively easily achievable and more speculative potential use cases. The fact remains that the industry is at the beginning stage of establishing blockchain confederations to foster ecosystem partnerships and for implementation standards or frameworks for large-scale healthcare use cases.
Blockchain technology is promising to transform healthcare radically by placing the patient at the center of the healthcare ecosystem and overcoming one of the key challenges which has tormented the healthcare industry for years - interoperability and privacy of data. With blockchain technology in healthcare, each individual will have full access to their medical records and control over how this electronic data is used. The individual can gain access to additional information such as who has accessed their data along with the time stamp which gives them the ability to grant or revoke permission to various healthcare providers based on their needs.
Many IT initiatives pertaining to the migrating patient electronic record to a centralized location with the aim of addressing the interoperability issues have hit a roadblock owing to vulnerability of healthcare data to frequent security breaches, leading to unauthorized access to patient’s medical history and subsequent regulatory implications.
With blockchain technology having proven its potential to address the concerns regarding access, security, and reliability of the data, it manages in the financial world by operating across a network of synchronized, replicated databases, by powerful encryption through public and private keys and by demonstrating the ability of operate an immutable, scalable registry, it can be assumed with some additional work specific to health records management (including security and privacy), each individual will be able to securely share the sensitive information about themselves without the fear of any security breaches.
With many government bodies working actively on healthcare legislations and with number of tech companies developing strong and effective cryptographic standards and focusing on privacy, it can be assumed that days are not far when blockchain and healthcare will go hand in hand.
Apart from ensuring availability of health data to all authorized stakeholders almost in real time, the disruptive blockchain technology in healthcare can also play a key role in detecting and preventing multiple fraudulent claims which is currently affecting the insurance sector. Many are piloting blockchain for maintenance of insurance contract and claims and ensuring validation by a network of insurance provider and regulators and other appropriate parties to ensure only the valid claims are settled.
The progressions in cryptography mechanism and how effectively the technology meets the industry’s interoperability needs taking into consideration privacy issues will play a key role in the adoption of blockchain. But every industry player agrees that this will be a significant disrupter and is going to alter the existing healthcare landscape.