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Blockchain Technology in Healthcare

Info: 8295 words (33 pages) Dissertation
Published: 9th Dec 2019

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Tagged: HealthTechnologyBlock Chains



Objective: To introduce the basic concepts of blockchain technology to the healthcare providers.

Design: A literature review

Setting/Background: Blockchain technology is a type of decentralized distributed ledger technology platform that enables proof of ownership and the transfer of ownership from one entity to another without using a trusted third party intermediary. It is made tamper proof by using cryptography and validated based upon consensus. Privacy, transparency, interoperability, transactional efficiency and reconciliation make it suitable to be adopted to healthcare delivery systems. Currently healthcare costs exceed 3 trillion dollars in the US alone. Blockchain based technologies can help cut down costs by making the operations more efficient. Developing better healthcare ecosystems, longitudinal patient centric medical records, identity management, verification, EMR interoperability, prevention of data breaches and ransomware attacks, drug/device supply chain management, billing/claims/payments/revenue cycle management, clinical trials/health research, population health management, government initiatives, provider licensure/credentialing, medical education, accreditation, pharmacogenomics, precision medicine, artificial intelligence, machine learning are some of the use case scenarios for blockchain technology. Blockchain technology has certain limitations. In order to be accepted mainstream it has to be made scalable by increasing the transaction speed. Educational workshops to all the concerned parties/consumers will make it more adoptable. There must be ongoing collaborations with major companies, government and healthsystem leaderships.

Conclusions: Blockchain technology in healthcare, is an emerging and transforming platform with a potential for scalability and mass adoption.

Key words: blockchain, distributed ledger, decentralization, healthcare use cases



What is a blockchain?


As the name indicates, it is a chain of blocks. Unlike brick and mortar blocks, these blocks are entirely digital. Blockchain technology comes under a broad classification called ‘Distributed Ledger Technologies’ and is a type of decentralized consensus platform.  In addition to blockchain, there are a few other distributed consensus platforms. For example Tangle, Corda, hashgraph, graphchain and the cicada platform.1

Blockchain is a protocol for a digital ledger that enables proof of ownership and the transfer of ownership from one entity to another without using a trusted third party intermediary. The blocks are made of records or ledgers of transactions. These ledgers are decentralized. That means there are no central authorities or entities controlling the ledgers. The blocks are encrypted through a technology called ‘cryptography’ and each transaction has a digital signature and is difficult to be hacked. Each block also has a secure digital key called ‘Hash’ key which is unique to the block. The hash key depending upon the underlying ledger entries. If someone changes the entered information the hash key also changes. Each block also contains the hash key information of the previous block in the chain. That means, each block is dependent upon the previous block in the chain. Participants in the blockchain have a secret private key (just like a password) and a public key (just like an email address).

Blockchain hence is a tamper proof ledger, operating in a decentralized manner.

It is extremely difficult and expensive to manipulate and hack the information contained in the individual transactions or the blocks. In the case of bitcoin, the most common blockchain application, the blocks are created every 10 minutes and are distributed to a vast network of computer ‘nodes’ in the world. The nodes are points of computer networks operated by people called ‘miners’ or ‘validators’. The miners verify the authenticity of each block and come to a consensus. Only if the consensus is reached,  that the block is validated and added to the chain and distributed to the entire network of nodes. That means every node will have the same copy of the blockchain. If the block is somehow altered, the hash key associated with the block changes. The miners can detect such altered blocks and discard them from the chain if a consensus is reached. In the process, the miners solve complex riddles using massive computer capabilities and electricity. As a reward, new bitcoins are generated for their use.




Blockchain attributes include:

  • Decentralization
  • Distribution
  • Transparency
  • Consensus based validation
  • Encryption
  • Transactional
  • Immutability
  • Privacy

Impact and market value of blockchain technology


One popular application of blockchain technology is a digital cryptocurrency called bitcoin. It was first described by Satoshi Nakamoto (or pseudonym by that name) in 2008.2 It started at few cents value in 2009 and by December 2017 was valued at $ 18000. Market value of bitcoins was $200 billion as of 12/5/17. As of December 2017, there are more than 15 blockchain companies with market cap exceeding one billion dollars each.

Ethereum is second most valued platform based on blockchain technology. Instead of transactions in the ledger, ethereum uses ‘smart contracts’. This platform seems to be more suitable for healthcare related applications.

The entire blockchain technology market is projected to be 7.74 billion dollars by 2024.3   

Main concerns with healthcare industry are the lack of interoperability in clinical care, privacy concerns, payments/claims processing and supply chain management. As mentioned by ‘Hashed Health’ there are fundamental ‘transactional inefficiencies’ along the entire workflow. Starting from insurance approvals for consultations, procedures, tests, surgeries, prescriptions, prior authorizations, peer-to-peer reviews all have to undergo long and complex transactional cascade between multiple parties and stakeholders.4

While it’s not a panacea for all the problems facing healthcare industry, blockchain technology certainly has a role to play in solving some of the problems. It can decrease the barriers of interoperability and make workflow seamless and frictionless. Data is better managed and hopefully patient experience and outcomes are improved. Better security against data breaches, malware, ransomware attacks would result in cost savings to all the healthcare stakeholders. As a result, Some consider it to be a transformational or even disruptive technology for healthcare industry. Either public or private blockchains and side chains are being utilized by many companies to develop solutions and applications.

Healthcare expenses in the US

US healthcare expenditure exceeded $ 3 trillion dollars in 2015 or 15% of the entire US GDP.5 Annually, about 750 billion dollars are avoidable or wasted due workflow/operational inefficiencies. Unnecessary services ($210 billion annually); inefficient delivery of care ($130 billion); excess administrative costs ($190 billion); inflated prices ($105 billion); prevention failures ($55 billion), and fraud ($75 billion).6,

Any improvements in the workflow/operational inefficiencies would lead to significant health savings. This is where the blockchain and other similar technologies would potentially play important roles.

Blockchain technology use cases in healthcare

Health ecosystem collaboration

Healthcare and hospital systems interoperability is a prime use case for blockchain technologies. Other uses include healthcare data aggregation, linkage and interoperability, provision of unique patient identifiers and verification and prevention of identity frauds. Better  communication between different providers and EMR’s; communication amongst various stakeholders, ie providers, patients, insurers, payers, banks, government programs etc

Improvement in medical practice workflow, reduction of health care costs, time and operational inefficiencies and better reconciliation between inpatient and outpatient status are other applications being explored using blockchain technologies.

Electronic Medical Records

There are an estimated 1100 EMR system vendors now. Suffice to say that the interoperability amongst different EMR’s is low. Larger EMR systems like EPIC have started interoperability functions via their private platforms. But considering the multitude of EMR’s in the healthcare industry, we are yet to create a universal health record system. When the critical information is most needed, it is often inaccessible due to many EMR systems which do not interact/interface with one another. This situation is commonly encountered by patients and providers alike. This leads to potentially life threatening scenarios.

Blockchain based platforms solve this issue by making the EMR’s interoperable. This can be achieved in two ways. First approach would be to improvise the existing or legacy EMR’s. Second approach would be to adopt new and capable EMR’s in their entirety. Each patient is provided with a unique identifying number. Patient identity is an important use case for blockchain technologies since identity thefts/frauds are prevalent. Once patient identity is established, then every interaction with the healthcare system is logged into the blockchain and would be a part of the patient-centric medical record. This medical record is longitudinal and compatible with any device or hospital system EMR’s. Data from wellness tracking devices and wearables can be incorporated into the medical record.  Devices like heart rate monitors and implantables are generating vast amounts of data on a daily basis. Data aggregation and integration into the patient record would be of paramount importance and can be done with blockchain based technology. Privacy is maintained since the blockchain is encrypted and only the patient and the specified health care providers have access to the medical record. Patient can take this record to any provider with the unique identifier key. The provider will have access to patient data including list of medications, allergies, relevant lab results etc. This obviates the need for duplicate tests and can result in significant cost savings.

Estonia, a small country in Europe with a population of 1.2 million people started using healthcare blockchain to secure health records of its citizens after a data breach in 2007. If a small country like Estonia can adopt the decentralized platform to manage vital health initiatives, then the same can be applied to other countries as well, including the USA.

In the US, Beth Israel Deaconess and Boston area hospitals have started using blockchain related data systems. MedRec, developed by MIT researchers,  is a novel, decentralized record management system for EMRs that uses blockchain technology to manage authentication, confidentiality, accountability, and data sharing.7

Google, IBM, microsoft and other major companies are creating or enabling healthcare blockchains.

Patient centric healthcare


Instead of the conventional provider centric health care, there’s a paradigm shift towards patient centric healthcare. In this model, patient is the driving force and healthcare services are there to facilitate health and wellness.

Patientory, based in Atlanta, has developed a mobile app using ethereum based blockchain technology to interface with different EMR systems like Epic, Cerner, Allscripts and Meditech. This app allows patient centric medical records to securely store, manage and share medical information.8

Bowhead Health, based in Canada, lets patients use Bowhead ‘tokens’ to pay for healthcare practitioners, nutritional supplements and medicine. Patients will

also be incentivized for participating in health-promoting activities or clinical studies. This is an example of monetization of patient data which is controlled by the patient.9

A health passport is created. This helps to coordinate appointments,consultations and referrals. In addition, wellness and health data are integrated; This record/passport is portable and operates across various hospital systems/medical practices.


Litra, another blockchain developer plans to create a common app for patient centric EMR.10


Data breaches and ransomware attacks

Vexing problems facing hospital and healthcare data systems are data breaches and ransomware attacks. Between 2015-2016, 140 million patients records were breached, that’s 1 in 3 Americans.11 Ransomware — a malware that infects computers and restricts their access to files, often threatening permanent data destruction unless a ransom is paid — has reached epidemic proportions globally. The damages cost 5 billion dollars in 2017.  Healthcare data is usually stored in servers that are controlled centrally. This can not only result in risk of manipulation but also makes healthcare data systems easy targets for hackers and other malicious individuals.12

In August 2017, the US Food and Drug Administration (FDA) issued a safety communication concerning several pacemaker models made by Abbott (formerly St Jude Medical). There were potential cybersecurity concerns involving malicious interference with battery life or essential programming functions.13

If blockchain based healthcare data systems are in place, the information is distributed and stored amongst various parties, making such attacks difficult. This would result in huge cost savings while ensuring security, privacy and reliability. Some companies working in this area are Telstra (user biometrics and smart homes)14, IBM (cognitive IoT),Tierion (time stamping, data verification).15


Billing and payment management system


Billing related fraud is significant today. Medicare fraud costed $30 million in 2016. Billing systems are complex and are prone to errors and manipulations by various intermediaries. Expenses related to billing and insurance related paperwork runs in the billions of dollars. Blockchain related healthcare systems can result in minimizing intermediaries, and billing related errors/frauds. Through automation, claims can be processed faster, resulting in timely care and reduction of administrative costs.

PokitDok, a company based in California, specializes in a technology platform that helps healthcare transactions become more efficient and the healthcare value chain streamlined. Patient access, identity management, benefits verification, automatic adjudication of claims, real-time pharmacy benefits,price transparency and payment management are some of the applications.16

Mergers and acquisitions

In the past decade or so, many hospital and allied systems are consolidating. This necessitates rebuilding operational systems since they are inherently different and siloed. Blockchain related systems may ease the pain of transition since there’s seamless, frictionless ability for transition.

Supply chain management in healthcare


Whether it is a drug or device or hospital supplies, the supply chain management plays an important role. Currently the challenges are the lack of trackability, accountability, leaks, pilferage, poor quality testing, counterfeit drugs or devices, poor communications and incompatible archaic software programs. In the process, 25% or more of the costs are wasted.

There are ‘transactional inefficiencies’ along the supply chain, according to ‘Hashed Health’.4 For example, a physician orders a test or prescribes a medicine to a patient. An electronic transactional cascade occurs then. The benefits and eligibility have to be verified. Next, the process of prior authorization and possible step therapy alternatives are recommended per policy and evidence guidelines. This is followed by the formulary check and patient assistance determination. There are too many intermediaries and electronic data transfer from the origin to the end. For the patient who expects and needs timely tests/medicines and interventions, this whole process causes inordinate delay and costs money/time and possibly worsening of patient’s condition. As a result, visits to Immediate Care or Emergency departments increase leading to further escalation of problems and costs.

One way to manage the drug/device supply chain is by tracking the entire inventory starting from the origin to the end usage. This process is called provenance and is emerging as a useful blockchain based application. Operational inefficiencies may be improved as well. Counterfeit products can be identified. Tracking supplies using radiofrequency based chips (RFID) are used by certain hospital systems. There are companies like Wabi17, Vechain18 that are developing tracking solutions for products ranging from baby foods, organic foods, fish to luxury items like cars and purses. Authenticity of drugs, devices and hospital supplies are tracked better using RFID chips and other tracking solutions.

Another blockchain application is the overhaul of drug exchange channels between manufacturers and end-customers.

MediLedger project is an open network for pharmaceutical supply chain.19  It is bringing together expertise in both pharmaceutical supply chain and blockchain technologies. Improving compliance of track and trace regulations, improving patient safety and drug supply security.

Clinical trials and health related research


As much as 85% of medical research data is redundant, costing us nearly $200 billion annually. Collaboration, communication and exchange of data are keys to successful clinical trials. Blockchain based technologies create time-stamped decentralized unchangeable ledgers of clinical trials, data collection, and results. Thus resulting in better coordination of research flow, while reducing the cost, the incidence of fraud/errors, data manipulation and biased reporting.20 In addition, monetization and incentives for patients and all the concerned stakeholders can generate larger trials that are relevant to the entire community. The healthcare data economy is transformed by blockchain technology.


Epidemiological studies, detection/management of communicable as well as rare diseases, finding cures for cancer, fighting the opioid epidemic, discovering non-opioid pain treatments are some proof of concept uses for blockchain.


Deloitte and Amazon Web Services have partnered to develop blockchain for clinical trials.21

Mercantis, a project which won the Health blockchain Hackathon 2017 provides a secure marketplace for verified medical research and EMR data using ethereum platform.22

Doc.AI is developing blockchain platforms for quantifying medical data using artificial intelligence. One specific example is the study of seizures using a decentralized program called Neuron, where both participants and researchers get incentives and in the process find out the triggers for seizures.23

Pharmacogenomics and Precision Medicine using Artificial Intelligence

According to the Precision Medicine Initiative, precision medicine is “an emerging approach for disease treatment and prevention that takes into account individual variability in genes, environment, and lifestyle for each person.” This approach will allow doctors and researchers to predict more accurately which treatment and prevention strategies for a particular disease will work in which groups of people. It is in contrast to a one-size-fits-all approach, in which disease treatment and prevention strategies are developed for the average person, with less consideration for the differences between individuals.24

Blockchain applications are still nascent in this field. Some companies testing their ideas and products are Zenome25, Healthcoin26, EncrypGen27, Insilico28.

Insilico Medicine, which makes artificial intelligence software for genomics, in partnership with the Bitfury group plans to co-develop blockchain- and AI-based products to help academic researchers and drug companies discover and apply biomarkers for aging and age-related diseases.29  Morpheo, based in France, has developed an open source platform to interface machine learning and large datasets pertaining to sleep studies.30

Government initiatives

Many states are collaborating with blockchain companies for governance. Illinois Blockchain Initiative is a collaborative effort launched to explore the innovations of blockchain and distributed ledger technology and their impact on government31

Provider related database, professional licensure, credentialing and interoperability across various states are specific use cases for such collaboration.

Chamber of Digital Commerce, an association representing the digital asset and blockchain industry, provides a platform for collaboration between private and public sectors. Healthcare related blockchain technologies are discussed in their annual DC blockchain summit.32


Other potential use cases are as follows:

  • Personnel management
    • Human resources
    • Ancillary staff management
    • Revenue cycle management
  • Education
    • Medical students, residents, nurses and ancillary staff training program logistics
    • Rotation specific goals/objectives/evaluations/feedback
    • Examinations and assignments
    • Board certification and maintenance of certification
    • CME activities and tracking
    • Scholarly activities and publications
  • Advancement in careers
    • Help or provision of leadership for hospital management, ie Chief Technology Officer, Cybersecurity/Information Officer, etc.
    • Rating, and professional reputation on social media
    • Networking
  • Accreditation
    • Medical schools, residencies, fellowships (ACGME)
    • Hospitals (JCAHO)
  • Professional licensure and credentialing
    • Provider database
    • Interoperability across various states
  • Quality assurance
    • QA/QI projects and ledger maintenance
    • Root cause analysis and other analyses
  • Patient safety
    • Tracking patient safety issues
  • Opioid epidemic
    • Management of prescription monitoring databases
    • Interoperability of various prescription monitoring programs and cost savings
    • Detection of inappropriate prescribing
  • Medical publications
    • Researcher centric publications and incentives
    • Streamline manuscript submissions, peer reviews and editorials
  • Medical association meetings/events
    • Event management including conduct and workflow/logistics of annual meetings and other events
    • Saving costs
    • Webinars

Future opportunities for blockchain healthcare applications:

Blockchain technologies have certain limitations. In order to be accepted mainstream they have to be scalable and increase transaction speed. Educational workshops to all the concerned parties/consumers will make it more adoptable. There must be ongoing collaborations with major companies, government and healthsystem leaderships. They should keep pace with fast growing technologies in machine learning, artificial intelligence, 3D printing, precision medicine and longevity.

Here is a growing list of healthcare related blockchain companies as of August 2017.33

  1. Blockchain Health (San Francisco). Blockchain Health focuses on health research where users share health data with researchers while maintaining control. All identities, and consents are tethered in the blockchain, and the chain of custody is easily auditable.34
  2. BurstIQ (Denver, Colorado.). burstIQ’s platform aims to create ‘health singularity’ by integrating multiple data sources and customizing healthcare based on the individual’s own unique genomic, medical, demographic and socioeconomic profile.35
  3. Doc.Ai (Palo Alto, Calif.). Doc.AI’s Robo-Genomics platform is a conversational platform for on-demand quantified biology and can generate insights on blood, genomics, microbiome, environmental and anatomical data.36
  4. Factom (Austin, Texas). Factom has developed an infrastructure for storing medical and other sensitive records on the blockchain. As of 12/22/17, more than 140 million records are stored in their blockchain.37
  5. Gem Health (Venice, Calif.). Gem in partnership with Philips is trying to connect the health ecosystem with universal infrastructure thereby decreasing operational costs.38
  6. Guardtime (Irvine, Calif.). The company partnered with the Estonian eHealth Foundation in February 2016 to accelerate transparency and auditability  for patient EMRs, thereby saving billions of dollars related to healthcare fraud.39
  7. Hashed Health (Nashville, Tenn.). The company has formed consortium of healthcare companies to provide value-added services such as product management, product development, regulatory guidance, and technology support services.40
  8. HealthCombix (Nashville, Tenn.). combines confidential human data asset management, disease prediction and decentralized payment networks to create new healthcare ecosystems.41
  9. Health Linkages (Mountain View, Calif.). Enables healthcare institutions to trust, protect and share their data.42
  10. Health Wizz (Falls Church, Va.). is developing a mobile platform for people to aggregate, organize, and share their medical records on a blockchain. It also helps to securely manage health data from wearables, EMRs, Doctors and Lab results.43
  11. Hyperledger (San Francisco). is an open source global collaboration, hosted by The Linux Foundation, including leaders in finance, banking, Internet of Things, supply chains, manufacturing and Technology.44
  12. MedRec (Boston). Developed by MIT Media lab, it is a novel, decentralized record management system for EMRs that uses blockchain technology to manage authentication, confidentiality, accountability, and data sharing.7
  13. Microsoft (Redmond, Wash.). Microsoft partnered with Accenture to build a blockchain prototype for healthcare as well as other industries. The blockchain will create a digital identity for 1.1 billion people around the world who don’t have a formal identity, including refugees.
  14. Netki (Canoga Park, Calif.). Netki aims towards digital identity compliance and validation.45
  15. Patientory (Atlanta). Patientory lets users to create profiles on a mobile app to securely store, manage and share medical information. The solution is compatible with different EMR systems.8
  16. PointNurse (Nashville, Tenn.). is a virtual care network platform that enables nurse practitioners and supporting team members to conduct direct primary care consults, health assessments, behavior management programs, and care coordination.46
  17. PokitDok (San Mateo, Calif.). makes healthcare transactions more efficient and streamlines the business of health.16
  18. YouBase (Englewood, Colo.) focuses on patient-centric data store for personal health information.47


Blockchain and other emerging distributive ledger technologies are transforming healthcare systems worldwide and many companies have proceeded beyond the proof of concept stage to provide viable solutions to healthcare issues. There is potential for scalability and mass adoption. Clinicians and healthcare stakeholders need to recognize the paradigm shift towards patient centric precision medicine model.


  • API: Application Programming Interface. It  is a software intermediary that allows two applications to talk to each other.48
  • Blockchain: is a continuously growing list of records, called blocks, which are linked and secured using cryptography  49
  • Bitcoin: First decentralized digital cryptocurrency based on blockchain technology
  • Cryptocurrency: digital or virtual currency that uses cryptography for security
  • Cryptography: Discipline or techniques employed in protecting integrity or secrecy of electronic messages by converting them into unreadable (cipher text) form. Only the use of a secret key can convert the cipher text back into human readable (clear text) form. Cryptography software and/or hardware devices use mathematical formulas (algorithms) to change text from one form to another50
  • DLT: Distributed Ledger Technologies: Distributed ledger technology (DLT) is a digital system for recording the transaction of assets and their details in multiple places at the same time.51
  • Ethereum: Ethereum is a decentralized blockchain based platform that runs smart contracts or applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.52
  • Hash function: A hash function, takes any input, and produces an output of a specific size. The process of applying a hash function to some data, is called hashing. The output of a hash function is called a hash53
  • IoT: Internet of Things.
  • MediLedger: An open network for the pharmaceutical supply chain54
  • Precision Medicine: disease treatment and prevention that takes into account individual variability in genes, environment, and lifestyle for each person.24
  • Provenance: is the chronology of the ownership, custody or location of an object.55
  • Proof of concept: documented evidence that a potential product or service can be successful.56
  • Smart contracts: are computer protocols intended to facilitate, verify, or enforce the negotiation performance of contracts without third parties.57


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I thank the following for peer to peer review and guidance while preparing the manuscript


Joseph Holtman Jr., MD., Ph.D,

Professor of Anesthesiology

Loyola University Medical Center

Maywood, IL, USA 60153


Funding statement:

No funding was used to support this work.

Competing interests

No competing interests exist.

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