Some healthcare organizations are moving fast on commercializing blockchain at scale and even seem to be ahead of the financial industry, according to a report by IBM Institute for Business Value.
In a new report about blockchains in healthcare, the IBM Institute for Business Value collaborated with The Economist Intelligence Unit on a survey of 200 healthcare executives, both payers and providers in 16 countries. The survey found that 16 percent of healthcare organizations, identified as “trailblazers,” plan to have a commercial blockchain solution at scale in 2017. This compares with IBM surveys of banks and financial market enterprises, which found just 15 percent and 14 percent, respectively, plan to be at commercial scale for blockchain solutions in 2017, according to the report.
“We found that 16 percent aren’t just experimenting, they expect to have a commercial blockchain solution at scale in 2017,” the report authors wrote. “These Trailblazers are leading the charge with real-world blockchain applications that they expect to take down the frictions that hold them back. They’re keenly focused on accessing new and trusted information which they can keep secure, as well as entering new markets.”
Further, the report authors noted, “Trailblazers expect the greatest blockchain benefits across time, cost, and risk in three areas: clinical trial records, regulatory compliance and medical/health records. They also anticipate widespread business model innovation—more than other industries we have surveyed to date—in six out of nine business areas.”
According to the report authors, rather than “big data,” blockchain innovation involves “long data,” or longitudinal data.
“How valuable would it be to have the full history of an individual’s health? What if every vital sign that has been recorded, all of the medicines taken, information associated with every doctor’s visit, illness, operation and more could be efficiently and accurately captured? The quality and coordination of care would be expected to rise, and the costs and risks likely to fall,” the report authors wrote.
And the report authors contend that data captured on blockchains can be shared in real-time across a scalable group of individuals and institutions.
The study found that healthcare institutions are “going all-in,” and investing heavily in blockchain pilots, with nine in ten respondents planning to finance blockchain applications by 2018 across all business areas surveyed.
Of those “trailblazer” healthcare organizations, six in ten anticipate blockchains will help them access new markets, and new and trusted information they can keep secure.
The respondents also identified a number of barriers to healthcare adoption of blockchains, with 56 percent of respondents citing immature technology as a barrier and 55 percent citing insufficient skills. Fifty-two percent of respondents worry that regulatory constraints can stall adoption while other barriers that were identified include lack of executive buy-in, lack of clear ROI and insufficient business cases. Further, seven in ten cite the need for a robust mechanism to establish identity and a high degree of control over access.
Further, the study found that not every region is moving at the same pace. Healthcare organizations in North America are lagging behind all other regions. Just 8 percent of North American respondents to the survey are “trailblazers.” In the U.S., organizations adapting to the new models created by the 2010 Affordable Care Act may have had priorities other than blockchains, the report authors noted.
In a previous IBM study, researchers identified nine frictions that challenge enterprises and constrain innovation. In this healthcare-focused study, healthcare executives were asked for their views on these same frictions and the impact blockchains might have.
“So much healthcare data is digitized but not yet shared, and there are extensive regulations and risks associated with sharing it. It isn’t surprising that trailblazers see the greatest impact from blockchains on those frictions we classified as information frictions – imperfect information, information risks and inaccessible information. They also view blockchains as a significant opportunity to enter once inaccessible markets,” the report authors wrote.
However, providers and payers have different views on the top frictions that blockchains could help reduce. Providers identified inaccessible information, information risks, transaction costs and inaccessible marketplaces as top frictions, while payers identified invisible threats, inaccessible information and imperfect information as top frictions.
“How individual organizations respond to blockchain opportunities in the next few years will depend on their circumstances, capacity and ambition. As with any new technology that has the potential to transform, there is no ‘cookie-cutter approach,’” the report authors wrote.
According to the report, the plans, priorities and investments of the “trailblazers” that are poised to enter the market today do illuminate a direction. More than seven in ten Trailblazers anticipate the highest benefits to accrue in three areas: clinical trial records, regulatory compliance and medical/health records.
With regard to regulatory compliance, blockchains are recognized as an ideal platform as they establish at trusted audit trail verifiable in real time.
More than six in ten “trailblazers” expected significant business model innovation in six of nine areas—clinical trial records, medical device data integration, regulatory compliance, adverse event safety monitoring, contract management and billing and claims management.
Respondents also identified four areas where blockchains introduced new business models or significant efficiencies that could contribute to the quality of care. These were: medical/health records, medical data device integration, adverse event safety and clinical trial records.
“Blockchains can be applied in each area. Over time, we would expect that blockchains that bridge these areas and integrate the data would have even greater impact,” the report authors noted.
The report also highlights use cases, proofs of concepts and pilots involving identity management and electronic health records (EHRs) underway. For example, in Estonia, considered by most to be the most advanced “blockchain nation,” all medical records already are stored online. While Estonia’s medical records are not yet blockchain-enabled, in 2016, the country announced its intention to secure health records on a blockchain that would provide real-time visibility to individuals and institutions.
The IBM researchers recommend that mass adopters should join the “trailblazers” to work on the new business and technology standards required for scale by beginning to build strong partnerships, including joining the consortia that are establishing business standards today. Further, the report highlights the work of the Hyperledger Healthcare Working Group (HLHC), which includes Accenture, Gem, Hashed Health, IBM and Kaiser Permanente and was announced this past October, that is working on establishing registries, interoperability and identities.