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Understanding Blockchain's Role in the Labyrinth of Healthcare

The infrastructure that underpins the healthcare industry is increasingly cited as ripe for a redux based on blockchain technology – to improve efficiency and reduce costs, and provide better services to patients. But the devil is in the details, so Distributed asked David George, Chief Commercial Officer of Gem, for his thoughts on how blockchain technology in healthcare will play out – from early moves to the endgame.

Q: Let’s start with the big picture – from a business perspective, what in your opinion is the good, the bad and the ugly of the U.S. healthcare system?

A: Healthcare today is a labyrinth. While newer technologies and standards are arriving in market currently to solve issues around data access, availability and systems interoperability, this hasn’t been available historically to ensure data continuity and aggregation across a patient’s lifetime of services. Healthcare is 10 to 15 years behind most industries in terms of technology adoption and we have multiple platforms and repositories of data, but limited common standards or partnering to actively share and manage data to verified identities across multiple entities involved in a healthcare transaction. The good news is that the market has been driving a patient-centric shift in healthcare that will make this data more highly demanded real-time in consumer friendly formats such as mobile. The bad is that current practices are piling critical data on top of fragmented infrastructure, across multiple private repositories, adding to the risk and complexity of moving data across the multi-entity healthcare transaction.

The ugly is that, without this infrastructure, we end up with different records of truth against a patient identity that live in disparate repositories across multiple entities (providers, payers, pharmacies, third party platforms like telehealth, wearables, imaging and increasingly genomic data). There is no common record of truth between the parties involved. We make costly and sometimes fatal mistakes because these records are inconsistent or inaccessible. It’s chaotic, and this has become the standard in many cases both for the providers and the consumers of healthcare services in the U.S.

Q: At a high level, what are the attributes of blockchain technology that map well on to the organization and processes of the current healthcare system?

A: At a high level, healthcare transactions are highly distributed across a vast landscape of companies and technologies today, and blockchains enable widespread access, availability and chain of custody around this data.

Healthcare is a complex, shared and regulated transactional environment, so security and accessibility to data need to play well together. Blockchain tech is an enabler in this regard. We can use it to build a distributed, permissioned registry of patient data, and we can control access to data using public and private key infrastructure. This fulfills both the privacy and portability functions of the Health Insurance Portability and Accountability Act (HIPAA), for example, and it can plug into existing workflows and technologies today.

Blockchain technologies, while technically exciting for those of us who get excited about new technologies, are really a way to create a better, fully transparent “universal workflow” across all stakeholders in the healthcare transactional chain.

Q: There are existing IT approaches to the interoperability issues in healthcare. Why is blockchain better than traditional technologies?

A: Interoperability in healthcare is a pretty overexposed theme right now. I might be off a bit in my numbers, but there were maybe 170 interoperability-focused companies at the HIMSS (Healthcare Information and Management Systems Society) conference last year. It’s important across multiple areas like pricing transparency, wellness, billing and population health, and it’s critical to making value-based payments truly successful. Blockchain technology provides an enhanced, technically viable, and frankly better, approach to achieving it.

Traditionally, interoperability meant developing more standards and translation layers between antiquated platforms, and implementing these standards with expensive custom development. Because these systems didn’t anticipate needing to share data in a seamless fashion, they weren’t architected to speak to one another to create a multi-system, multi-entity digital transaction – tied to a single identity.  It’s a complex challenge made even more challenging by health IT companies that do things like charging “access” fees through their APIs and gateways, creating expensive and contractually limiting environments for data interoperability.

Blockchain technology allows us to take a different approach to interoperability, in which identity is key. Rather than trying to homogenize data across the network, we can establish a unique patient identifier as the common denominator across a global registry of patient data that is stored externally in its native state. Here, “interoperability” is really about using identity and access management to make data more available, portable and secure.

Q: Can you drill down on a few specific healthcare applications that you reckon will be the first to benefit from blockchain approaches?

A: Two of the first applications I see are optimizing claims management and unifying patient medical records. In the claims management scenario, all parties involved can manage a single claim file over the blockchain by publishing its updated “state” as it moves through the workflow. This alone could solve massive inefficiencies in reconciliation. Combine this with a unified patient health record, tied to an identity that the patient controls, and we can create what amounts to an aggregated registry of all clinical data and historical claims associated with a patient.

The patient would also have greater access and control over how and when their data is shared.  This is a bit of a perfect world scenario and will take copious amounts of cross-industry cooperation to make a reality. But these are the types of problems we can now tackle to create change.  Gem sees the needle moving in this direction today.  

Q: Even tackling these first applications, blockchain technology is surely going to need to scale beyond Bitcoin. How can it do that?

A: Bitcoin is a truly novel invention purpose built for exchanging digital currency between two non-trusting parties, but at the end of the day a bitcoin is just a type of data. We are focused on using blockchains to exchange all types of data across multiple parties in a value chain. We also see a future where there are many types of purpose-built blockchains with platforms and applications that navigate among them, so that is what we’re doing with GemOS.

The answer to enterprise blockchain solutions is identity management, which isn’t a function of the protocol necessarily but of the applications that reference it. Bitcoin creates a record of truth between two non-trusting parties – without a middleman and without making the parties known to each other. This is revolutionary, and it’s expensive and unnecessary in transactions where the parties do know each other and have at least a semi-trusting relationship. Identity doesn’t just apply to people either. It applies to devices, groups and software – anyone or anything that can transact. Giving identity to participants on a blockchain helps create a record of who did what and when, which is an important component to network security.

Q: And when it comes to medical records, that is very sensitive information. How can blockchain approaches ensure it is only accessible by those authorized to access it?

A: Medical data is sensitive because it is personal to the patient. If I don’t want my data to be shared or made publicly available, it needs to be housed in a secure environment.  Ultimately, it is my personal data. More often than not, I need this data to be shared for simple things like making sure my multiple doctors, pharmacists and healthcare practitioners are well informed, or that I get reimbursed through insurance.

Blockchains can be distributed registries for data that’s stored securely in the cloud or wherever the data should reside. Blockchains are not effective data stores. At Gem, we can use them to communicate user access permissions across a network of disparate applications and users, which provides the owner of the data the option to provide access to all, or just portions, of their healthcare data.

In GemOS, we hash the medical record with a timestamp, user public keys and their relative permissions, and we record this to the blockchain. The blockchain now contains a reference to the record (the hash) and instructions about user access rights. When an application queries the blockchain for the record, the blockchain communicates those instructions, which the application must be programmed to follow.

Q: How accepting do you expect participants in the healthcare system to be about adopting blockchain-based applications? Do you expect there to be pushback from any group?

A: I think that we will find some pushback, but that is to be expected in the face of any significant technical shift in an industry. It’s not new; change creates value, but it can also create some level of friction and conflict. That being said, there is a large contingent of companies that are looking for greater efficiencies to create a more patient-centric environment in healthcare and to turn those efficiencies into margin gain. Advancements that are as globally impactful as blockchain will be recognized and adopted quickly. That’s Gem’s initiative in health. We need to demonstrate actual impact in operational efficiencies across an industry to make this technology valuable.  This requires cooperation, partnership and flexibility. And a degree of agnosticism.

Q: Gem is working with the Philips Blockchain Lab. Can you talk about what you are working on together and what you hope to achieve?

A: Gem and Philips are working together to explore how blockchains can support patient-centric services across the continuum. We can’t talk specifics, but we are working together diligently to prove out market use cases and value.

Q: Looking to the future, beyond first applications, how do you imagine that the healthcare system could ultimately be reinvented with blockchain approaches? And, crucially, how will patient care improve?

A: Let’s start with the effect on the healthcare transactional layer – the business of transactions across healthcare. Blockchains can unlock efficiencies across the transaction value chain, eliminating reconciliation, creating data provenance, supporting better identity and access management. Most of the value that will be recovered will be in cutting down the toll booth companies that have sprouted up between the patient, the provider and the payer.

Right now, there are so many parties involved in a healthcare visit, or any health workflow, that it creates latency in the delivery of these services. Blockchain technologies can reduce this latency by connecting all parties and applications to the same record of truth across the network. Beyond just increasing efficiency, this opens up the transactional network to support smaller companies, startups and microservices.

The more companies, apps, services and patients that connect to and leverage this network, the more powerful the network becomes. To really see the future of healthcare via blockchains, you have to be able to imagine a world where services are highly interconnected, but in which data is unique, secure and auditable. Specifically, you can imagine a patient who has a global view of their health data and can directly share and revoke access across providers. You can imagine a payer who can identify their customers across a number of health plans and providers. You can imagine providers querying public registries of private data to request access for their patients, instead of relying on opaque platforms with questionable integrity.

Users will have their data available when they need it. They will view their financial transactions, their clinical transactions and their pharmaceutical transactions against a single identifier. And they can control third party access to it. There is an opportunity for both operational efficiency and user empowerment, and having both together will deliver a smarter, healthier and safer population.

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