Article Synopsis :
Blockchain has struggled to find a viable application within insurtech, but it is likely to have a profound effect on the healthcare sector according to this paper from NTT Data Services.
Blockchain technology is a combination of a number of proven technologies that are applied in a new way.
A blockchain is literally a chain of records, called blocks. These chains can be used to maintain lists of digital transactions. Each block contains a timestamp and a digital signature, with a link to a previous block, and contains a process that prevents the record being altered, improving security.
These qualities make blockchain highly suitable for electronic healthcare records (EHR) or electronic medical records (EMR) within healthcare.
According to a recent PwC report, almost half (46%) of blockchain development is being undertaken in the financial services sector, against only 11% in healthcare behind energy and utilities and industrial sectors.
There is a need to evaluate and identify transactions that are a natural fit for this technology, but the potential is great, because “blockchain is immutable, trustless, decentralized and distributed, it holds the potential to disintermediate processes, optimize workflows, cut operational costs, eliminate duplication of work and fight fraud.”
NTT has identified a number of applications within the healthcare sector:
– Claims and billing management by making all parties aware of their share of projected cost for service and by reducing administrative costs through automated billing and insurance-related activities.
– Medical data management by Improving the secure exchange of healthcare information.
– Reducing fraud, through validating submissions by pulling data from multiple sources. Fraud costs the industry more than $80 billion a year.
– Health research and clinical trials. It is estimated that half of all clinical trials go unreported. Blockchain can address selective reporting and the manipulation of results, reducing fraud and errors in clinical trial records.
– Tracking counterfeit drugs. Counterfeits are believed to cost pharma companies losses of $200 billion a year. Blockchain could provide a more secure tracking system, preventing counterfeits from being introduced to the supply chain.
– Securing protected health information. Health systems have been prone to many high profile cyber attacks. Between 2015 and 2016 140 million patient records were breached, affecting more than 27 million patient records. In almost half of cases, insider error or wrongdoing were the causes. Blockchain could support existing healthcare IT architecture monitor and secure connected devices.
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Digital Insurer's CommentsThe argument for the role of blockchain in healthcare is compelling. That there is a live trial being undertaken in the Estonian health system lends weight to this argument. Aside from making the decision, the authors rightly point out that a degree of control is required for any system contemplating this move.
In order to minimise risk and downtime, organisations must plan their dependencies early and determine just what is going to be used by blockchain.Then they must set expectations and then stick to a basic set of rules they have devised. Then they must identify the tools they need to perform this function.
With insurtech set to take a massive leap forward in 2019, it is unthinkable that healthcare won’t be in the vanguard of that development.
It is also reasonable to assume that applications elsewhere in, for instance, claims handling won’t see blockchain integrated into insurtech models.
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