How Blockchain is Benefitting Healthcare

Blockchain is uniquely well-suited to address some of healthcare’s most intractable challenges stemming from fragmented, siloed information and processes.

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Blockchain has the potential to transform healthcare by increasing openness, security, interoperability, and efficiency in patient data and medical systems. This emerging technology is uniquely well-suited to address some of healthcare’s most intractable challenges stemming from fragmented, siloed information and processes.

In this comprehensive guide, we’ll examine the basics of how blockchain works and why it can transform core healthcare functions like managing patient records, improving supply chains, enabling clinical research, streamlining insurance claims, boosting data security, and more.

Healthcare Challenges:

Blockchain technology has several benefits that are being leveraged in the healthcare industry:

  1. Decentralization: Blockchain allows for a decentralized management system, providing distributed stakeholders with controlled access to health records without a central authority.
  2. Improved Data Security and Privacy: The immutability property of blockchain enhances the security of health data. Once data is saved to the blockchain, it cannot be altered or retrieved. All health data in the blockchain is encrypted, time-stamped, and appended in chronological order. Additionally, health data are saved using cryptographic keys which help protect patient identities .
  3. Health Data Ownership: Blockchain technology enables patients to own their data and control its usage. It provides strong cryptographic protocols and well-defined smart contracts to ensure data is not misused by other stakeholders.
  4. Availability/Robustness: Since records on blockchain are replicated across multiple nodes, the system guarantees the availability of health data. It is robust and resilient against data losses, corruption, and some security attacks.
  5. Transparency and Trust: Blockchain’s open and transparent nature creates an atmosphere of trust around distributed healthcare applications, facilitating acceptance by healthcare stakeholders.
  6. Data Verifiability: Even without accessing the plaintext of the records stored on blockchain, the integrity and validity of those records can be verified. This feature is particularly useful in areas of healthcare where verification of records is a requirement, such as pharmaceutical supply chain management and insurance claim processing.
  7. Updated Medical Supply Chain Management: Blockchain is ideal for organizing and tracking the flow of medication supplies due to its security, reliability, and decentralized storage. It builds a reliable supplier network and unifies all operations, including manufacturing, packaging, marketing, shipping, and warehousing information.
  8. Improved Electronic Health Record Systems: Blockchain can enhance electronic health records (EHRs) by distributing ownership of the records across all stakeholders, thereby overcoming issues with availability, compatibility, and verification.

Advantages of Integrating Blockchain Technology in the Healthcare Sector

1. Patient-Focused Electronic Medical Records

A study by Johns Hopkins University found medical errors to be the third leading cause of death in the United States, largely due to fragmented care coordination. Healthcare systems worldwide struggle with isolated data silos, leading to incomplete medical histories between patients and providers. A promising solution is implementing a blockchain-based system that seamlessly integrates with existing electronic health record software. This unified system acts as a single repository for a patient’s complete record, enabling secure and transparent data sharing. Importantly, actual patient data is not stored directly on the blockchain. Instead, each new record, like a prescription, doctor’s note, or test result, is encrypted into a unique hash only accessible by authorized users.

2. Transparency in Supply Chains

Verifying the authenticity and origin of medical products is a major challenge in healthcare. Blockchain provides a solution by tracking items across the entire supply chain, from production to distribution. This gives consumers complete visibility into the products they buy, addressing concerns like counterfeit prescription drugs that cause many deaths annually, especially in some regions. Combining blockchain with AI can build customer confidence through end-to-end tracking, optimize supply chain operations via data-driven forecasts, and help combat counterfeit medical devices.

3. Patient Data Management and Exchange

The rising number of healthcare data breaches, exposing millions of records, underscores the need for secure patient data handling. Existing privacy regulations like HIPAA impose strict limits on accessing patient records, making traditional approaches complex and breach-prone. Blockchain provides a unified platform to securely store and manage all relevant patient data. Each data piece is stored as a blockchain block identified by the patient’s unique ID, enabling secure sharing without revealing the ID if the patient desires anonymity. Blockchain also offers reliable population health data management, giving individuals a secure way to participate in health studies and benefit from the findings.

4. Drug Traceability

Blockchain delivers reliable drug authenticity by enabling end-to-end traceability from production through distribution. Each blockchain block contains immutable data about the drug, linked via timestamps and hashes. This transparent system lets authorized parties track drugs in real time, making it nearly impossible to distribute counterfeits. Consumers can verify that purchased drugs are genuine by scanning QR codes to access manufacturer and supply chain data, ensuring a safer pharmaceutical ecosystem.

5. Cryptocurrency Payments

Blockchain enables innovative healthcare payment solutions like receiving and making payments for medical services via cryptocurrencies. For instance, technology-focused medical group Aveon Health leverages Bitcoin for electronic transactions. Micropayments, facilitated by blockchain, introduce value-based models that reward patients for treatment and lifestyle adherence. This blockchain model meticulously records patient activity related to adherence, creating a transparent, incentive-driven healthcare approach.

In conclusion, blockchain technology holds immense potential to revolutionize healthcare by addressing critical issues related to openness, security, interoperability, and efficiency in managing patient data and medical systems. This emerging technology is particularly well-suited to tackle the persistent challenges arising from fragmented and siloed information and processes within the healthcare industry.

Mercy Boma Naps-Nkari

Mercy Boma is a dynamic and results-driven Blockchain Developer and Huddle Developer Advocate with a passion for crafting innovative solutions using smart contracts and distributed ledger technology.


Mercy Boma is a dynamic and results-driven Blockchain Developer and Huddle Developer Advocate with a passion for crafting innovative solutions using smart contracts and distributed ledger technology.