Blockchain in Healthcare: Going Beyond Hype with Practical Use Cases

Sean Connell, Chief Technology Officer

December 2017 may have marked the moment of peak hype for blockchain technology. The Long Island Iced Tea Corporation changed its name to Long Blockchain Corporation and the world watched in confusion. Except the move paid dividends initially, boosting shares of the company by over 289%.

The short-term value of adding blockchain to the company name disappeared alongside the Bitcoin crash. But still, business leaders in just about every industry were ready to buy into the blockchain hype.

In 2019, business leaders can’t just buy into the high-level promises of blockchain systems. Especially in the healthcare industry, it’s important to look beyond the hype and find practical use cases that benefit both patients and providers.

The Blockchain Basics

“The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value [without an intermediary].”—Don & Alex Tapscott, authors of Blockchain Revolution

Part of the problem with understanding practical use cases of blockchain is its definition. Whether you see the quote above or another definition that calls blockchain a “distributed, decentralized, public ledger,” it can be difficult to zero in on the real-world applications.

There are plenty of articles that dive deep into the technical ins and outs of blockchain systems. But those often contribute to the widespread confusion regarding practical use cases. To get a better understanding of how a blockchain transaction works, take a look at this image from the Financial Times:


While many people equate blockchain with cryptocurrency and financial transactions (as shown above), the use cases are far broader. In fact, many blockchain leaders have gone as far as to call this technology the new internet.

At its core, blockchain is a new type of database that decentralizes information and improves security. That means:

  • No single person or company controls the information.
  • Multiple parties share an interest in the same ledger, meaning consensus agreement is necessary to add new data.
  • Information can only be added, and previous entries can’t be edited.
  • Anyone on the network for a particular ledger can access and replicate the data.
  • Hacking a blockchain system would mean compromising every single block in the ledger, which is nearly impossible.

This reshaping of shared ledger control where the intermediary is removed from the “transaction” (whether that is a financial transaction or a prescription from the doctor), is certainly the most complex to understand, and the most disruptive. It’s a paradigm shift in the truest sense of the word.

If implemented properly, these characteristics of blockchain systems can transform healthcare experiences and operations.

4 Practical Use Cases for Blockchain in Healthcare

According to one Gartner report, blockchain will add $176 billion to businesses by 2025—and $3.1 trillion by 2030. These predictions may seem outrageous at such an early stage of blockchain, but it’s clear that analysts see this as a transformative technology.

If you want to reap the benefits of blockchain systems in the healthcare sector, you need to change the way you store and exchange data. As you start to build out a blockchain strategy in 2019, here are the most practical use cases for the technology for healthcare organizations:

  1. Simplifying and Strengthening the Supply Chain: The healthcare supply chain is heavily regulated and can literally make the difference between life and death. Visibility at every step from manufacturing to patient delivery is essential. And with blockchain systems, you get transparent records of transactions, making it easier to verify the integrity of your supply chain.
  2. Tracking Compliance and Risk Management: Tracking patient data, product distribution, provider credentials, and ethical requirements has become increasingly difficult with the shift toward electronic health records. And with such strict requirements for data privacy regulations like HIPAA and GDPR, it can be difficult to balance compliance with patient experience. Blockchain systems can simplify backend data processing and streamline operations for audits, product recalls, provider credentialing, and more. And with smart contract logic built into these systems, you can take advantage of more effective event triggers for individual patients.
  3. Unifying Electronic Health Record Systems: Healthcare IT is complex and if systems aren’t using the same host for electronic health records (EHR), it can be difficult to seamlessly and securely share patient data. By decentralizing the data, blockchain systems transcend these interoperability issues and make it easier to share data without sacrificing security and privacy.
  4. Streamlining Admin Processes to Reduce Fraud: Fraudulent medical insurance claims prove costly because tracking issues can be so difficult. So much of the claims process is manual, opening the door for errors in data entries and long verification processes that hurt the patient experience. Blockchain can automate the tracking of health insurance claims to give payers more accurate records and automate lower-level tasks.

These are just a few ways that blockchain can transform the healthcare sector. But the use cases extend beyond these examples. Any standard database could eventually be augmented by a blockchain system that decentralizes information to streamline access and maximize security. The key is to look at your own operations and pinpoint unique ways to leverage blockchain—both as it exists today and as it evolves over the coming years.

Your success will come down to strategy. If you want to get out ahead of blockchain and other emerging technologies, check out what’s NECXT in customer experience.