How Blockchain Is Changing the Future of Healthcare

by Ivana Radevska | May 19, 2022 | blockchain, blockchain technology, blockchain technology applications, data, data breach, data privacy, data records, data security, ehr, electronic health records, Healthcare, healthcare systems, medical blockchain technology, medical data, medical records, patient records, pharma, physician burnout, supply chain management, systems, technology
How Blockchain Is Changing the Future of Healthcare

The American healthcare industry is currently on the cusp of a transition due to its latest technological solution – blockchain.

For some time, blockchain has been around in the banking/finance and pharma industries. However, for healthcare, it holds the potential to solving long-standing challenges of the complex workflows within organizations.  

This article explores how the latest blockchain technology will revolutionize healthcare and some implications that may rise.

Existing Challenges in the Healthcare System 

Healthcare is one of the most delicate sectors.

Moreover, it is directly connected to us in all possible ways – physically, mentally, and financially.

Therefore, the impact of new technologies demand immediate attention and thorough investigation.  

Despite the initial enthusiasm, the healthcare sector has lagged behind others when it comes to adopting and utilizing blockchain technology. However, deploying blockchain will be pivotal in optimizing a wide range of processes and overcoming many challenges.  

Here are some existing challenges happening in the health sector today.  

1. Lack of Fast Interoperability

A few setbacks facing the healthcare industry is the disjointed and scattered patient data across stakeholders, departments, and systems. In essence, medical data sharing is the foundation of an effective healthcare system. Yet today, systems still require patients to obtain and share medical records via physical paper or electronic hard disk copies.  

This process is ineffective for many reasons:  

  • Records must be prepared, delivered, and picked up by patients within 30 days – making the process slow.  
  • Records may be lost or stolen during physical transportation by patients from one location to another; therefore, it’s not too secure.  
  • Patient health history may be fragmented (or incomplete) if data is stored in separate systems or is summarized.
  • Healthcare systems are provider-centric instead of patient-centric, preventing patients from taking control of their own health records. 

A lack of architecture prevents crucial data from being accessible. As a result, it inadvertently affects the accuracy of the treatment for patients.

While on the other hand, efficient data sharing improves diagnostic accuracy by gathering recommendations or confirmations from other medical experts.  

However, with the recent privacy legislation and data management changes, patients may face difficulty retrieving their own records.  

2. Inefficient & Complex EHR Data Storing

Nowadays, Electronic Health Records (EHR) systems are used as an effective method to share patients’ records among different healthcare institutions and hospitals. However, this process is far from seamless, as it is a challenge to access siloed data through multiple EHRs.  

Additionally, EHRs are often attributed as one of the top reasons for physicians’ burnout. As a matter of fact, physicians who spend more than six hours weekly after hours in EHR work are almost three times more likely to report burnout and worse work-life balance.   

For this reason, physicians who spend more time manually updating systems are more likely to misdiagnose and cause adverse patient outcomes. Not to mention, approximately 40% of healthcare provider data records are filled with errors or misleading information.

Healthcare centers run on complex, data-intensive, manual processes, even more so than other industries.  

3. Limited Access to Population Health Data

Aside from healthcare practitioners, researchers also struggle with fragmented and siloed data. Due to potential liability and financial consequences associated with data sharing, providers feel reluctant to exchange patient data, even though it is anonymized.

On a local level, medical data is used to monitor population health and target interventions. At a national level, it’s used for resource allocation and planning. Finally, on a global level, population data is needed to estimate global burdens of diseases, measure progress and development in health, and contain emerging global health threats.   

Additionally, data is crucial for secondary use involving academic research and technology developments. For clinicians, aggregated intelligence and insights help them understand patient needs allowing them to apply more effective treatments.

4. Data Privacy & Data Security

Despite the need for sharing, concerns over information security and privacy take higher priority. And yet, many healthcare facilities are still dependent on outdated systems for storing patient records.  

Data security breaches shed light on the system’s inadequacy in exchanging sensitive information securely. Healthcare systems today are not unified. Instead, they use several EHR’s that can be exploited making the industry vulnerable to cyber-attacks.   

I.B.M.’s 2021 Cost of a Data Breach report states that healthcare has had the highest industry cost of a breach, with an average total cost of $9.23 million. Another report found that 83% of medical imaging devices run on unsupported operating systems, leaving organizations at risk of cyberattacks.  

Maintaining these systems is also a challenge. Think about it. An interface change on one system requires other parties in the trusted network to adopt the change as well. As a result, these issues have spotlighted the urgent need for a highly secure medical infrastructure.  

5. Interoperability Concerns

Nowadays, medical data may contain large volumes of data from various sources. Sources can be cancer patients, patients with chronic conditions or others.

Medical records of patients include medical images, lab reports, wearables, and physician reports. These large-scale datasets are challenging to share electronically, especially in rural areas with limited bandwidth or restrictive firewall settings.    

How does Medical Blockchain Technology Work?  

Many people associate the word “blockchain” with cryptocurrencies since that is the technology that enables Bitcoin transactions. So, you might be wondering, what does crypto have to do with healthcare?  

The same blockchain technology used in Bitcoin can help the healthcare industry streamline record management without compromising data security.

Blockchain is a digital ledger, an immutable, transparent, decentralized, and distributed technology. It records transactions, each assigned its own block that becomes part of a chain, hence the name blockchain. This transaction record is distributed to all computers on a network rather than being stored centrally.   

Blockchain allows people, businesses, stakeholders, or computers to exchange value digitally without an intermediary.  

The data value may be a monetary transaction, information, medical records, exchange of assets, or something else. This new model for health information exchanges (HIE) removes the need for multi-level authentication, making it more efficient and secure.  

Blockchain Technology Applications in Healthcare 

For years, the medical industry has focused on a provider-centered care model. This model has used existing technology that has resulted in lack of trust and transparency in the medical ecosystem.

For that reason, blockchain technology is the driver of a critical transformation in the healthcare sector. Today, the medical landscape is moving towards a patient-centered approach. And with this, comes two main focuses: accessible services and appropriate resources at all times.  

Blockchain allows organizations to provide adequate patient care and access to high-quality health facilities. Health Information Exchange, a significant burden due to its time-consuming and repetitive nature, is quickly resolved using this technology. Additionally, citizens may partake in health study programs and clinical trials, resulting in better research and improved public wellness.  

The use of blockchain in healthcare can be applied in the following primary areas: 

  • Managing electronic medical record (EMR) data 
  • Securing healthcare data  
  • Personal health record data management 
  • Clinical research and data access  
  • Prescription tracking to avoid opioid overdose and over-prescription  
  • Health insurance claim automation  
  • Securing supply chain management 
  • Point-of-care genomics management  

Shaping the Future of Healthcare with Blockchain 

Blockchain is gaining traction worldwide.

In healthcare specifically, it’s being looked as a way to improve trust, transparency, and accountability in the current interdependent workflows.

In fact, some healthcare operators are already implementing a few of the key applications in the areas of health information exchange, supply chain, health insurance claims management, clinical trials management, and health data management.  

1. Supply Chain Management

One significant benefit of blockchain is its provision of traceability.

According to the World Health Organization, one in 10 products in developing countries is either substandard or fraudulent. There is a significant risk of counterfeit drugs and tampered medicines, which could be potentially fatal.  

These products fail to treat or prevent diseases. Still, they are also a waste of money for individuals and health systems that purchase these medicines. Worst of all is that these falsified medicines affect the most vulnerable communities.  

With the introduction of blockchain solutions, every ingredient can be traced.  

The whole supply chain – from manufacturing to pharmacy shelves – is transparent and resistant to tampering. This decentralization and easier auditing of blockchain is a promising approach to prescription monitoring. At the same time, we can further tackle the opioid crisis in the United States. 

2. Data Security 

Aside from drug management, digital frameworks built on blockchain prevents the illicit handling of medical records, payments, and insurance claims.  

It is estimated that over the last five years, 90.4% of health records have been compromised and that one in three health care recipients may be a victim of a data breach.  

While blockchain makes transactions more visible, it is also private. For example, it can hide an individual’s identity with secure algorithms that can preserve the sensitivity of medical data.  

3. Health Care Fraud

An estimated $2.6 billion loss is attributed to health care fraud and abuse. Further, fraudulent care occurs in various forms, such as kickbacks, false claims, and illegal self-referrals.  

One of the greatest inefficiencies in the healthcare industry lies with patient billing. 5-10% of all healthcare costs are due to overbilling, billing for services not rendered, and provisioning of medically unnecessary services.  

Suppose an insurance company determines that the billed service is inappropriate or medically unnecessary. In that case, they may reduce the amount paid to the provider. Therefore, all claims submitted for payment must be coded accurately.  

Healthcare fraud has a direct negative impact on medical care utilization. Besides, it leads to a waste of limited resources and could potentially endanger patients. Claims adjudication can be more accurate and easier on the patient by automating the process through blockchain.  

Smart contracts are agreements written in code and have the potential to drive standardization in the claim process.    

4. Patient’s Medical Verification

One of the most demanding challenges in healthcare is the inefficient EHR data storing. Switching providers or referrals to medical practitioners in other hospitals involves developing new patient data cards, which are repetitive and lead to a loss of time. In essence, blockchain may alleviate some of this burden on physicians.  

Thanks to blockchain’s decentralized structure, information can be shared swiftly and safely between patients, doctors, pharmacists, and healthcare providers. Having patient data in one platform allows stakeholders to update a patients information in real-time while staying on top of their health.

An interoperable blockchain system can better strengthen data integrity while protecting patients’ digital identities. To sum up, blockchain enhances security, data exchange, integrity, interoperability, and real-time updating. It is set to transform the future of healthcare.  

Blockchain Implementation Challenges & Considerations  

The promise of blockchain presents numerous opportunities for healthcare and may have widespread implications for all stakeholders in its ecosystem. However, as with any rapidly evolving technology, technical and organizational challenges need to be addressed before blockchain can be adopted in healthcare nationwide.  

Some of these challenges include: 

  • Technology needing to be scalable for future needs 
  • Blockchain is immutable yet needs to support health system evolution  
  • Data transparency needing to be balanced with health privacy concerns 
  • The cost of computing power to process transactions is not yet known for large-scale operations  
  • Organizations needing to find the use of blockchain technologies compelling to implement it  
  • Public awareness about the use of blockchain is low  

As with all new technologies, time will allow us to understand the full multitude of challenges and vulnerabilities it brings.

Regardless, the potential is enormous, and worth exploring, investing, and testing further.   


To summarize, unified access to anonymized records through a trusted system is required in our increasingly globalized world. Evidently, blockchain has the potential to change the future of healthcare by unlocking massive health benefits for individuals, communities, and organizations.

Ivana Radevska

About Our Contributor, Ivana Radevska:

Ivana Radevska is an HR and benefits content expert at Shortlister.

She speaks three languages and enjoys writing guides for HR professionals.


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