Blockchain technology can safeguard electronic health records, trace pharmaceuticals and track clinical trial data, but few developers are building prototypes for this potentially lucrative field, according to Emily Vaughn, blockchain product director at Change Healthcare, a health care technology company.

That’s because health care is a cautious industry. It’s highly regulated, and any changes to the way things done are typically proven in other industries before they can be applied to anything that could affect human health.

There are plenty of obstacles to blockchain’s acceptance. There’s skepticism around blockchain’s scalability and security, Vaughn tells ThirtyK. Many health care providers, payers, pharmaceutical companies and regulators have only a nodding acquaintance with blockchain, and there are few applications in use.

It takes time and persistence for these ideas to take hold, but more and more enterprises are seeking blockchain consulting and prototypes,” Vaughn says.

Overcoming this chicken-and-egg scenario requires more user education and fully developed applications and development tools that make it easier to interact with blockchain networks, she says. A regulatory nod of approval would help, too.

Further slowing adoption, the U.S. health care system is distributed, with many different providers and payers, each with their own technology preferences.

A Complex Supply Chain

“The biggest obstacle to using blockchain in health care is the lack of data sharing,” Melanie Nuce, blockchain expert and senior vice president of corporate development for the information standards organization GS1 US, tells ThirtyK. At a patient level, for instance, electronic health records (EHRs) may not be compatible with EHR technology in other health care systems. At a pharmaceutical level, it still can be hard to quickly and accurately trace ingredients, manufactured lots and individual doses through development, manufacturing and delivery.

The failure to share data and collaborate effectively with supply chain partners hinders a company’s ability to take advantage of one of the main benefits of blockchain for health care – having an automated, immutable record of a product’s chain of custody,” Nuce emphasizes. Those supply chain partners include suppliers, distributors and pharmacies.

This is particularly pertinent given the requirements to track and trace pharmaceuticals at the lot, pallet, case and individual-package levels. In the supply chain, many (health care vendors) maintain proprietary product identification numbers and closed-loop data management systems that aren’t compatible with their supply chain partners’ systems,” she explains. That makes it harder to track recalled products and prevent them from reaching patients.

Forays Into Blockchain

The Mayo Clinic is one of the leaders pushing blockchain adoption. Working with Medicalchain, a London blockchain technology startup, it is developing blockchain-protected EHRs, as well as apps to help medical educators track their impact in the medical community.

Meanwhile, some startups are trying to get patients to upload their data onto the blockchain. For example, Embleema wants to pay them cryptocurrency for doing so and allow them to choose whether to share their anonymized data with researchers.

On the business side, Change Healthcare’s claims transparency solution lets health care providers track the lifecycle of an insurance claim directly from a blockchain without needing their own node infrastructure. This eases scalability and security concerns, showing that “blockchains can meet the transactional demands for health care,” Vaughn says.

The Adoption Time Line

It takes time and persistence for these ideas to take hold, but more and more enterprises are seeking blockchain consulting and prototypes,” Vaughn says. “The inflection points will be mass consumer adoption of blockchain, enterprise consortia bringing products to market, and meaningful adoption by one of health care’s large IT players.

A recent IDC report predicts movement, saying that by 2020 one in five health care organizations will be “using blockchain for operations management and identity.”

For her part, Vaughn predicts that widespread adoption of blockchain in health care could catalyze in the next five years and stabilize in the next 10 years. Adoption for business-to-business transactions may come much sooner.

Gail Dutton
Gail Dutton is a veteran journalist who has interviewed several Nobel laureates as well as leading innovators in the fields of biotechnology, IT, and business. She has written for a variety of trade and consumer magazines, including Forbes, Entrepreneur, The Scientist, Genetic Engineering & Biotechnology News, Life Science Leader, Data Center Knowledge, and Data Center Manager, from her office in Washington state.