Blockchain Applications in Healthcare

Blockchain Technology for Healthcare

Blockchain Healthcare

Blockchain Technology has the potential to disrupt the healthcare industry’s centralized operations, opening the door for optimized business and service delivery. The Distributed Ledger Technology (DLT) is an innovation fertile with the possibility of improved transparency, security, and efficiency. Smart contracts on the blockchain operate automatically without third-party personnel needed to verify documents or specific steps using pen-and-paper processes. With automation comes a reduction in the notorious bureaucracy that currently stands in the way of patients receiving the best care possible.

Immutable data stores that can be analyzed and updated in real-time are working to reshape the healthcare landscape entirely. Existing centralized models have proved to be inefficient in delivering affordable quality health care to populations. When a community is healthier, we all win. Highly efficient blockchain-based applications and ready to be deployed to redefine how healthcare institutions operate from National Healthcare Systems to privatized hospitals. Not only can direct health care interventions be improved, so can prescription compliance and healthcare insurance models. The list goes on.

As DLT works to dramatically improve the transparency and efficiency of an outdated industry even parties beyond patients and providers benefit. Regulation and auditing become easier to manage. Introducing top of the line technology also improves business operations and gives key health care players a clear advantage over private sector competitors.

When our existing healthcare framework is slow, expensive, and requires ten different intermediaries, we know there is a problem. Governments and hospitals want to provide comprehensive care that is affordable to administer as it is easy for the public to access. Now with blockchain technology the tools are in place to make that mission a reality. Small startups and larger companies that are early adopters are figuring out ways to cut overhead, deliver better care, streamline insurance coverage processes, and therefore improve the overall quality of life and extend life expectancy for the greater population.

The Pitfalls of Centralized Healthcare Systems

The centralized healthcare system as we know it today varies from country to country. Most countries have a national healthcare system that distributes care centrally through the government. In the U.S. we have a privatized for-profit health care system with government programs for low-income individuals and the elderly. National healthcare systems, government administered programs, and privatized for-profit healthcare all share similar pain-points as a result of decentralization and outdated technology. Here are some of the main issues with centralized health care delivery:

Information Sprawl

  • Important and private information is scattered across different facilities for many patients and storing, transferring, faxing, and organizing this uncontained mess is costly, monetarily and otherwise. The sprawl is inefficient and makes patient data statistically more vulnerable. Patients that have multiple providers for one ailment or condition have no guarantee that information will be shared with all health care team members in real-time or at all. The responsibility then falls on the patient to coordinate their own care and data transferring information from specialist to specialist.

Data Insecurity

  • Centralized data stores are easier to hack as they only have one point of entry and one exit. The healthcare industry, like virtually every other sector, has now transitioned to become excessively reliant on cloud storage issues to alleviate server dependency. Both servers and cloud storage have major security pitfalls that leave confidential patient information exposed at this central and insecure data storage location.

General Inefficiency

  • From insurance companies to medical supply chains there is a level of inefficiency that permeates all outdated centralized systems for service delivery, and the healthcare industry is no exception. It is estimated that $800 billion plus is spent on duplicate services that are a result of nothing more than low-quality communication between healthcare professionals.


  • High administrative fees, overpriced testing, duplicate treatments, fraud, and low-quality prevention methods make healthcare one of the most wasteful trillion dollar industries in the world. Ad hoc billing and insurance costs alone in the privatized U.S. system are in the billions as well. Other wasteful spending is due to poor patient outcomes and lack of preventative health care.


  • Online portals have alleviated some of the waiting game for patients, now data trickles down from provider to patient through an online interface. However, these online portals are still slow and rely on paper pushing and multiple third-parties. Access for patients reaches an all-time low when inefficiency and cost are at a high. This is what the average sick visit looks like for a patient in the U.S.:
  • First they must see their Primary Care Provider, then they will have referrals to get to a specialist who they sometimes wait over a month to see, then they have to wait on tests appointments, test results, and must reconvene with separate professionals all in possession of different and sometimes conflicting information. By the time the appointments and testing are completed and an intervention chosen, it might be too late.

Opaque Operations and Pricing

  • There is a shroud of mystery from a patient perspective clouding all health care protocol within the centralized operating system; this is probably the most significant problem with the modern healthcare industry. Patients are being left in the dark about their health from prevention to their personal healthcare data to why their medication costs ‘x’ amount. Through the centralized system, the only answer to improved transparency is more middlemen to liaison between care providers and insurance companies and pharmaceutical companies. This will likely lead to even less transparency and more red tape.

Blockchain Healthcare News

The Benefits of Decentralizing Healthcare

Deploying Distributed Ledger Technology can improve the healthcare supply chain in countless ways. Healthcare is incredibly data heavy, and when critical information becomes lost in the shuffle, it can dramatically alter patient outcomes. As discussed in the prior section looking at the pitfalls of centralized healthcare operations, it is this misuse of technology and lack of proper technological infrastructure that stands in the way of successful healthcare delivery. The flaws mainly rest in the health institution’s inability to create linear information stores for patient data that would allow for fast and easy information sharing and improved patient access. Central administration becomes moot in a decentralized tech landscape, all users take equal ownership and have equal access to information without sacrificing security.

Here are the potential ways blockchain integration could revolutionize the healthcare industry:

  • Interoperability

More sophisticated and robust APIs could allow for Electronic Health Record (EHR) interoperability, meaning, that health information systems can work together across organizational boundaries to deliver more advanced and effective healthcare interventions. The blockchain network serves as an ideal platform for interoperability and could help to resolve the issue of informational patient data sprawl plaguing the industry.

  • Improved Data Stores and Analytics

Blockchain can help create a patient-first environment where the populations can control their data on a permissioned blockchain. Identity can be removed from actual health care data to improve statistics while still providing real-time, tamper-proof analytics for improved healthcare interventions.

  • Immutability

When a single immutable document exists for every patient, the data is then tamper-proof, and accuracy is guaranteed. When data is more accurate, data analysis becomes nearly error-proof as a direct result. Immutability also helps to secure documentation and prevent fraudulent behavior and malpractice.

  • Tighter Security

Decentralized data storage and payment platforms are automatically more secure by nature of their design. Servers and cloud storage are more vulnerable, and all information is centralized, ready to hack in one fell swoop. Blockchains are difficult to hack as they rely on cryptography and asymmetrical private key systems to safeguard transactions. These encrypted personal signatures are incredibly difficult to manipulate. Additionally, when data is decentralized it is no longer stored in a singular place with one point of entry, it is in multiple copies on a peer-to-peer network that is innately more difficult to penetrate.

  • Reduced Costs

Blockchain technology works to streamline expensive multi-step processes. In the case of healthcare, there are endless bureaucratic hoops patients and providers jump through to implement even the most basic healthcare intervention successfully. Eliminating go-betweens and unnecessary steps that separate patients from receiving timely and effective care will additionally work to reduce costs. When fraud and duplicates are reduced using blockchain technology everyone in the supply chain can save money.

  • Faster Care Delivery

Decentralizing the healthcare industry can help reduce delays for both patients and providers. When data is made more available and shared on a public ledger, and the referral process between primary care doctors, health insurers, and specialists becomes abridged, patients can receive care faster. Improving back-office operations will generally make all areas of the industry operate more smoothly.

  • Transparency

When all actors in the healthcare industry have equal access to tamper-proof information on the blockchain, there is a surge in transparency. Decentralized technology becomes the great equalizer that affords access to those previously left in the dark. A more transparent healthcare system is a more affordable healthcare system.

Main Industry Areas for Blockchain Applications in Healthcare

Healthcare isn’t just limited to the doctor’s office; there are countless agencies, direct care professionals, and patients involved in a single healthcare ecosystem. Healthcare ecosystems also vary from country to country, this guide is very US-centric. In the United States, there is a much wider net cast when the term “health care” is used. There is an intricate web of pharmaceutical companies, health insurers, primary care providers, in-network specialists, private hospitals, public hospitals, Medicare, and Medicaid. All of these must work in harmony to provide the general population with adequate care.

Here is a list of some of the main areas where blockchain applications could improve overall healthcare delivery ecosystem:

  • Health Insurance
  • Pharmaceutical
  • Private healthcare providers
  • National healthcare systems
  • Medical research
  • Nursing homes & elder care
  • Dentistry
  • Healthcare Administration

Blockchain Applications in Healthcare Use Cases

If decentralized networks are streets and superhighways, blockchain applications that use smart contract programming are the self-driving cars making up the traffic flow. Smart contracts self-execute according to predetermined agreements between multiple parties. The code exists across the distributed blockchain network and is then triggered by a specific event. This technology opens up the doors for endless automation possibilities that could greatly improve current healthcare delivery systems. The sky is the limit when it comes to use cases in healthcare.

Here is a list of more popular proposed blockchain applications in healthcare use cases, some of which are already in development:

Electronic Medical Records

Electronic Medical Records on the blockchain are the #1 use case for blockchain applications in healthcare. Why? Because a single, longitudinal and tamper-proof patient record could be made possible thanks to distributed ledger technology. This would place all vaccines, lab results, treatment strategies, and prescription history in a central linear ledger stored on a decentralized peer-to-peer network.

Tokenized Healthcare

Users can share, learn, and earn with their personal medical information. Prevention or treatment could be incentivized for patients through tokenization. Using tokens to motivate community members to improve public health outcomes not only helps in building a healthier general population, it additionally becomes an income stream for participants and stimulates the economy.

Prescription Medicine Compliance

Millions are spent annually on prescription medicine incidence due to improper patient compliance. Medication adherence problems are endemic and costly for individual patients who suffer and the healthcare system as a whole. Incentive for improved medication adherence could be tokenization through APIs that help gamify the prescription-taking process (see the previous use case). Adherence information stored on the blockchain can be a more accessible place for doctors and patients to communicate and follow up with pharmaceutical interventions over time.

Automated Health Insurance (Claims Adjudication)

With the use of smart contract programming on the blockchain, claims can be verified via a p2p network and executed automatically. Without a biased central authority claims fraud could be eliminated through the trustless blockchain environment, which will also help to speed up the claims process.

Personalized Care

 The blockchain can facilitate more personalized treatments for individuals based on improved EHRs. When superior, easy-to-share data is in place over time it can even import family medical histories to encourage more tailor-made interventions. No two patients are the same, and healthcare providers know this, but do not have the current resources available to have even the most routine checkups be personalized.

Medical Product Supply Chain Tracking

Companies that vend products to patients through the medical care system have to navigate an incredibly complex supply chain, especially when prescriptions are involved. When items or medication need to be recalled it is difficult to trace the products back to their origins. When blockchain applications are used to record the exchange of goods and services a neat and linear audit trail is created. The transaction history can authenticate products automatically to decrease counterfeiting and better recall medications with harmful side effects.

Telehealth Provider Credentialing

As Telehealth becomes a more viable remote-care option, patients are looking for verification that online care providers are the real deal. Introducing blockchain to auto-verify licensure and send out updates to users could help keep telehealth costs down. Notifications could also be sent when there is a new health practitioner on the rooster accepting patients.

Patient Consent Management

All patient consent paperwork could be verified on the blockchain, instead of relying on office personnel to authenticate. Prior to visiting the doctor’s office, patients can use blockchain portals to record their symptoms and give their consent to treatment immutably. These timestamped and secure documents have the potential to settle malpractice lawsuits in a more timely and affordable fashion.

Blockchain Payment Platforms

Payment platforms on the blockchain are more secure and faster. Health insurance on the blockchain can automatically release funds held in a smart contract when a trigger event (like a patient getting a lab test) occurs. Users can hold their own funds in a smart contract tucked away for medical emergency co-pays for automatic out-of-pocket payments.


The healthcare industry has a lot to gain from adopting this latest wave of decentralized technology. The mechanisms that currently make the healthcare industry run are outdated, time-consuming, and expensive. Blockchain might not revamp the entire industry overnight, but it is still important for healthcare professionals, administrators especially, to learn the value of the distributed ledger. When web 3.0 solutions are introduced, they might be initially expensive or difficult to onboard, but the long-term benefits outweigh the short-term concerns.

With more secure, efficient, transparent, and affordable healthcare operational systems comes enhanced public health and higher life expectancy. There is much waste to reduce within the current model and plenty of evidence to support blockchain’s ability to alleviate that financial burden from providers all the way down to the average patient at their annual checkup. Smart contracts are a crucial piece to enabling automation to replace error-ridden pen-and-paper healthcare processes. Disrupting the healthcare system with decentralized technology can revolutionize every corner of the supply chain (if deployed correctly) and create a situation where everyone in the existing ecosystem could benefit.