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Role of Blockchain in Healthcare

silhouettes of people over a map

Blockchain is a time-stamped series of health information exchange based on interoperability. It is cryptographically encrypted data where blocks (digital information) are stored in chains (public database) which is a digital ledger. They are managed by a cluster of computers known as nodes, where no single entity owes the complete responsibility, creating a decentralized technology. Immutability, accountability, transparency and decentralization are the four pillars of blockchain. The information displayed in the chains is open to everyone making it a transparent and accountable system. It is a simple, yet ingenious way of transferring information from one source to other by block creation which is safe and automated.

The blocks are verified by millions of nodes that are spread across the net. Once a block is verified, it is added to the chain creating a unique record history. As blockchain technology is decentralized, the information about the transaction (including name, date, time, card number, etc.) is not stored at a single location. Once the block is added to the chain, they are distinguished by creating a hash - a mathematical function that converts the digital information into a string of numbers and letters. It becomes inconceivable to edit and delete the information, making it less susceptible to be hacked or corrupted.

Although the system is transparent, it still secures individual identities and only the public address is visible to all. Blockchain technology is maintained by a peer-to-peer network and there are interconnected nodes that takes in the input and gives out the output. It thereby makes transactions faster by streamlining and automating the processes, cost cutting due to no involvement of intermediaries and there is no single point of failure.

Blockchain Technology can be applied in finance, healthcare, real estate, commerce, arts, etc. As per a survey conducted by Deloitte involving 1000 companies from 7 different countries, it was found that 34% of the companies use blockchain technology, 41% were expected to deploy blockchain in the coming years and around 40% were ready to invest more than $5 million in the future. Companies currently using blockchain are Uber, Airbnb, Bitcoin, IBM, Nebula Genomics etc. As per prediction by World Economic Forum, 10% of the global GDP will be stored in blockchain by 2025.

Blockchain technology has been widely used in healthcare for medical record keeping, reducing counterfeit drugs, increase the accessibility of electronic health records, tracking clinical trials, medical credentials and pharmaceuticals. Proper maintenance of medical record is of utmost importance in order to prevent redundancies and maintain confidentiality of the patient. However, medical record is too erroneous and scattered. Various events during patient’s life require transfer of patient data from one provider to another. Errors are more common while handling the patient’s data making the healthcare organizations work with mostly incorrect and incomplete patient records.

Blockchain’s role in healthcare

Blockchain is an effective technology that can help prevent data breaches in the healthcare industry. It is a secure and reliable method of recording, storing, and sharing sensitive data. Our focal point will be on medical data management and patient data protection. Although emergence of blockchain technology is at a nascent stage in health care, it has potential to solve chronic problems around data interoperability and privacy. As per study conducted by IBM titled, ‘Healthcare rallies for blockchain’, 16% of health care executives have plans to implement blockchain technology in 2017 while 56% pledged to implement the technology by 2020. The agenda of global leaders is to create a common database of health care information. Doctors and providers can utilize this data across multiple Electronic Health Records (EHR), have higher security and data privacy. It will even lead to better sharing of research results to facilitate new drugs and treatment regimen.

1. Medical data management: With large volumes of health care data being generated across multiple patient visits, it is imperative that data warehouses overcome the challenges around interoperability and develop the ability to store and securely transfer data across various providers and hospital systems. EHRs weren’t traditionally designed with multitasking functionality such as data transfer via multi-institutional channels for lifetime medical records of patients. Ideally, a decentralized record management system should be created to handle EHRs using blockchain technology. Currently, patients and providers face significant hurdle in data sharing due to economic incentives that encourage blocking of health information. As per the Office of National Co-Ordinator (ONC) report, healthcare IT developers tend to interfere with data flow by charging exorbitant amount for data exchange through various interfaces. Contrarily, healthcare is losing an approximate $300 billion per year on account of untapped data integration.

When patients travel from one state to another, the responsibility of healthcare data lies with the provider and not the patient. Patient data is often scattered, and complete information is never available to new providers. Through the Health Insurance Portability and Accountability Act (HIPPA) rule, providers can take up to 60 days to correct any erroneous data. Moreover, patients are never encouraged to take ownership and review their complete healthcare data. Lack of interoperability results in waste of time, money and duplication of procedures along with creation of life-threatening situation due to lack of data flows across various health care systems.

Ecosystems such as health information exchange (HIE) aim to ensure that data from patient EHR are securely, accurately and efficiently transferred. With Blockchain, patients could approve or deny health care data sharing or any alteration. This validation aspect stamps the key difference between the two. In case of sharing data with new providers, patients would not have to take time to collate the data from older providers, but simply the new specialist would be added to the chain. Therefore, implementation of blockchain will help patients and providers gain one-stop access to entire medical history. Patients can even monetize their healthcare data for clinical research encompassing future treatment guidelines.

2. Patient data protection: Modern medicine and innovation in patient treatment has led to increase in average life expectancy, and subsequently more electronic data. Patient data security is thereby top priority for health care organization of all sizes. Storage and sharing of data amongst health care providers, researchers, insurance companies, pharmacies to maintain access control through numerous consents complicates and prolongs patient treatment. Industry experts believe that blockchain should be used as a ledger tool and not for storing heath care data. Healthcare data breach is expected to cost $380 per record and is expected to grow in the immediate future. Many healthcare organizations still use outdated data systems to store critical, sensitive health care data and are vulnerable to cyberattacks as the records include credit card, social security information and medication history. As hospital technology systems are become more complicated and rely on interconnected network of devices, a single weak device can compromise the security of the entire network. Also, hospitals are more inclined to invest in new medical equipment over cyber security for protecting their network.

The recent WannaCry cyber-attack in May 2017 on the National Health Services (NHS) systems cost £92 million with cancellation of 19,000 appointments and lock out of 200,000 computers with error messages demanding Bitcoin for release. NHS was criticized for using the outdated Windows XP operating system making it vulnerable to cyber-attacks. The most disturbing example of ransomware is cyber-attack faced by patients who use IoT embedded devices, cloud-based monitoring devices for treatment of life-threating diseases. Such attacks can be detrimental for hospitals and medical device companies towards retaining customer faith and loyalty as well as endangering patient life.

Blockchain increases the privacy and security of data as the encrypted data on a blockchain network can only be decrypted with patient’s private key. In case of data intrusion by hackers, there is no practical way of reading the encrypted data. However, public blockchain bring data privacy concerns since it follows the public ledger methodology. To deal with this, many public blockchain platforms retroactively add privacy layers of obfuscate data. If these privacy layers do not interoperate, it would create data in silos, the exact problem blockchain was meant to solve. For private blockchain, lesser nodes that participate in the ledger result in faster performance and overcome data privacy issues.

MedRec effectively leverages the use of blockchain technology that aids in proper data sharing while ensuring reliability and confidentiality. It helps in restructuring fragmented data into a structured comprehensive format, ensuring proper data usage.

Blockchain architecture

The illustration below highlights steps followed in a standard transaction processed using blockchain technology:

figure showing blockchain architecture

Challenges of embracing blockchain

Blockchain data is protected by public-key encryption. However, protecting the data through encryption requires specific tools and permission to decrypt the data. This raises a question as to who takes the ownership of decryption key? Parents would be taking the ownership of healthcare data belonging to minor children, in case the key is lost how would parents be able to retrieve the key? Common population is not familiar with cryptography concepts and they rarely understand the importance of safely securing the decryption key.

Another concern is that anyone with access to ledger can change it after consensus from participating nodes who have access to healthcare data, but it is still theoretically possible for unwanted updates to occur. There should be an additional control check given to the owner of the data to give specific control rights among the pool of nodes who have the authority to change the health care data or participate in the consensus approval process.


As per Medtronic, by 2025, 55% of healthcare companies would be adopting blockchain for commercial transactions. This need has been propelled by the fact that healthcare data is at massive risk of leakage due to lack of security systems compared to other industries such as banking and finance. Healthcare is a tricky industry since it requires safe storage of data but also it is essential to freely share data amongst various stakeholders like doctors, pharmacists and insurance companies. Protecting personal health information. This makes adoption of blockchain technology imperative to authenticate and share medical health records which will only happen within a pool of authorized stakeholders resulting in worldwide data interoperability and security.

Blockchain will also become an integral part of patient consent management such that all stockholders can access the consents and respect patient wishes in providing access to protected health care data. Improvements in infrastructure pertaining to blockchain will enhance transaction speeds thereby reducing operational cost in terms of resource allocation and electricity consumption. It will also accelerate potential marketplace for data-enabled people who want to contribute towards their health care data for clinical trials. Key features of blockchain will help secure transactions and preserve integrity of data, which makes blockchain an essential and attractive technology for storing and transmitting sensitive healthcare data.



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