Applications Tech

Wednesday Deep Dive: The Case for Blockchain in Healthcare

October 25, 2018
Saad Mohammad


Wednesday Deep Dive: The Case for Blockchain in Healthcare

Cryptocurrencies – and the blockchain-driven projects behind them – are regarded by some as mere buzzwords with no real-world value. Here we present a case for blockchain and cryptocurrencies in the provision of healthcare services: we talk about some of the problems and challenges seen in this space, what blockchain-based crypto projects working on healthcare aim to do, and potential benefits of implementing blockchain across various healthcare services.


Data Silos

The healthcare industry has traditionally suffered from a wide range of problems. Quality medical resources are often concentrated in the hands of a few large players, and a lack of reliable diagnosis tools, combined high patient turnover rates that are typically seen at healthcare institutions, leads to an overburdening of staff, ultimately resulting in lower-quality health outcomes. In addition to this, healthcare data, because of its sensitive nature and because of the type of data that it uses, is often kept siloed and isolated from the systems that need them.

Legacy Systems

Furthermore, healthcare systems today are way behind the curve when it comes to the tools and processes used for data collection, storage, and transfer. Healthcare infrastructures are notorious for relying on old, legacy approaches and processes and have yet to adopt new ways of doing things on a global scale. To add more complexity to the mix, centralized data storage that is owned by the likes of hospitals and private care centers means that the majority of patients have little or no control over their private health data. Not enough people realize the fact that having centralized silos such as these is not just an inefficient way of doing things but it represents a huge security and privacy risk as well.


Finally, it is very common for distrust to exist between different parties involved in trade, and distrust is a hindrance to the speed and efficiency of traditional business models. Thanks to built-in transparency, tamper-proof protocols, and the replacement of the different and competing agencies involved in various business activities across the healthcare services provision lifecycle being replaced by algorithms and smart computer functions, the cost of doing business can effectively be driven all the way to zero. As such, blockchain-powered businesses can enjoy exponentially safer, faster, and more secure operations.

These are the problems and challenges that using blockchain in healthcare can fix.

The Benefits of Blockchain

We can think of Blockchain 1.0 as the advent of digital currencies. That would make Blockchain 2.0 the rise of blockchain-powered projects and companies, with Blockchain 3.0 representing entire blockchain industries. Across all three stages of blockchain’s growth and maturity, one thing that has remained static and unchanging is the underlying logic of multi-party trust and data confirmation that are integral parts of decentralized blockchain projects in all their various forms. From fintech and agriculture to entertainment and, yes, even healthcare, blockchain can help protect data privacy, deliver business processes that are democratic, secure, and transparent, and create value quickly and efficiently.

Blockchain allows companies and organizations to build new, decentralized, all-inclusive service platforms that combine health and medical services, drug research data, health insurance, and patient records in cohesive, tightly-knit ecosystems.

Here are a few areas in which these things can actually be done:

Data Exchange

In existing systems, in order to establish trust between the likes of hospitals, patients, insurance companies, and doctors, point-to-point information exchange is required between all parties to ensure the accuracy of what data is exchanged. When you consider the complexity of health data (everything from patient histories, drug dosages, scans, test results, and even doctor notes in the margins), such systems are error-prone, and exchanging information in this way is very costly and time-consuming.

Blockchain addresses this issue via the disintermediation of trust: Giving all participants in the healthcare provision cycle access to a distributed ledger will solve the information exchange problem without introducing problems of security breaches and distrust.

Costs of Operation

Current systems, due to low transaction volumes, have high costs per transaction, reducing the business case for centralized systems or for new networks between participants. It is no wonder, then, that healthcare as an industry has been slow to modernize in terms of processes and tech adoption.

Blockchain implementation reduces transaction costs thanks to disintermediation as described above, and real-time processing of data further enhances the system’s efficiency.

Security and Privacy

With so many different people and organizations accessing patient records, it can be difficult keeping a lock and key on sensitive data and provisioning those who need specific types of data with the data they need while excluding others.

Thanks to the cryptographic recording of data in individual blocks in the blockchain, public and private keys can be used to create a single database of information while giving different agents involved in the provisioning of healthcare services customizable levels of access to secure and/or sensitive data. This may be done via the use of smart contracts that create consistent criteria for giving access to sensitive data depending on the role of the requestor or their place in the healthcare services provision cycle.

Data Usage

The highly heterogeneous nature of data in healthcare services provisioning often leads to reduced compatibility and interoperability between different departments because systems cannot interact with each other.

With blockchain, records are standardized and updated across the entire network in real time.

Companies Working in this Space

There is a long list of blockchain-based healthcare projects. Here is a small sampler.

Patientory is developing a blockchain-based platform that will connect patients, healthcare services providers, and medical institutions. Patients can create private profiles to track their medical and health history, and they can easily track things like doctor visits, bills paid to doctors or hospitals, and medication and insurance information.

Coral Health operates similarly. This company aims to create a platform where patients can securely and easily share their health data with hospitals or other medical institutions in order to facilitate highly personalized health diagnoses and care regimens.

Finally, we have EncrypGen. This company first came into the public spotlight after announcing that it would help people sell their private DNA data for cryptocurrency, and that’s pretty much what they are trying to do: building a blockchain platform that helps people exchange their genomic data for cryptocurrency.