Blockchain technology is poised to revolutionize a number of industries from fintech to medtech and everywhere in between. While much of the recent hype around blockchains has more specifically focused on cryptocurrencies, which are built using, but not synonymous with, blockchain, other real-world applications of the underlying technology are beginning to receive more attention.
Last week in Washington, DC, the Insight Exchange Network (IEN) hosted “Healthcare on the Blockchain” and the “Government Blockchain Leadership Forum,” a duo of events focused on discussing many of these applications and organized to provide a framework for executives in decision-making roles to better understand what many perceive to be a daunting, untenable buzzword. Medgadget took the opportunity to attend the event’s healthcare-specific track to learn more about this young, but powerful digital technology as well as its relevance to medicine.
Both tracks of the event had the opportunity to kick things off with a three hour blockchain workshop, which served as an industry-agnostic primer to introduce the concept of blockchain and dive a little into the details of the technology. Jim St. Clair, Founder of the Institute for Healthcare Financial Technology and CTO of Dinocrates Group, LLC, ran the workshop. Before getting into the event coverage, the following is a brief summary of some key takeaways from the workshop that also help set the scene for the rest of Medgadget’s coverage of the event.
Abbreviated Blockchain Technology Primer
Bitcoin and blockchain are not the same thing. Blockchain is the technology upon which Bitcoin, a digital currency or cryptocurrency, was built. There can be and are many blockchains, and many cryptocurrencies for various industry and application-specific uses. Blockchain technology, in and of itself, is not a new technology. It combines many existing concepts, including large databases, voluntary participants, peer-to-peer networks, distributed ledgers, and cryptography, to protect against fraud. There are three levels of how blockchain technology is currently being used: (1) storage of digital records, (2) exchange of digital assets in the form of tokens, and (3) execution of smart contracts. Smart contracts set the ground rules for how transactions take place, execute the contracts while monitoring compliance, and automatically validate the results of each transaction.
In the absence of institutional trust from a single source, blockchain relies on consensus, which is where the concept of mining comes from. Each new block added to a given blockchain must follow an accepted consensus model approved by the democratic network of nodes. The biggest difference between consensus models is the level of agreement between participants. For example, Bitcoin’s consensus model requires 51% approval of all nodes for addition of a new block to its blockchain. Encryption of information on a blockchain is achieved by hash functions which map data of arbitrary size to data of a fixed size through a cryptographic method or algorithm. Hash function outputs have the property of being unique, as one hash represents one unique input, asymmetric, as a hash cannot be reverse engineered, and random, because there is no pattern between inputs and outputs.
There are many myths surrounding blockchain. To shed some light on a few: (1) Blockchains are trustless. There is always some level of trust required and blockchain networks can be disrupted if that trust falls apart. (2) Blockchains are immutable or tamper proof. Transactions on a blockchain can be reversed and tampered blocks can be successfully added to a blockchain by network participants under specific circumstances, such as having enough users to achieve consensus or if enough nodes collude. (3) Blockchains are 100% secure. Blockchains are not inherently more secure than other systems or offer network security above and beyond traditional network security. Using an immutable cryptographic hash does confer a strong sense of security but there are theoretical limits on that security and that security is not conveyed to data referenced by blockchain transactions that is housed off-chain.
Following Jim’s workshop and lunchtime networking, each track of the conference kicked off in full beginning, on the healthcare side, with an executive roundtable featuring moderator Daniel J. Gietl, Principal for IT Advisory Technology Transformation at Ernst & Young LLP, and panelists Cab Morris, CEO of Attest, Stephan Baur, Principal IT Architect at Kaiser Permanente, and Kyle Culver, Solution Architect at Humana.
For the session, Daniel asked the panelists whether they agreed or disagreed with a series of statements and to elaborate on their positions. Panelists, and attendees, unanimously disagreed with the first statement that “blockchain is the same thing as bitcoin.” There was also a consensus regarding the statement that “blockchain technology is a new concept.” Kyle, in the same vein as Jim from the earlier workshop, held that the collection of components related to blockchain are not new, though the combination of them is unique. Stephan added that the operational mode and B2B space related to blockchain is also completely new, which contributes to his excitement about the technology. The statement, “blockchains are capable of supporting big data solutions,” led to some discussion on what support really means. Kyle believes that blockchains can enable and help inform big data activities but support of the data itself will not come from blockchain itself. He used the analogy that a blockchain should be treated like a library card catalog that points to where the books are but does not hold the books themselves. Cab agreed with this perspective and added that the value of a blockchain is in tying disparate data sources together in a network where the value of that data changes.
Daniel next asked the panel to respond to the statement that “the blockchain-application vendor landscape is complicated and constantly needs reevaluation.” Stephan contended that it is not the vendor landscape that needs ongoing evaluation but the open source landscape upon which the applications and vendors will build their solutions. Cab added that there is a distinction between people innovating in a permission-heavy, private, enterprise-focused world, and others who are building public solutions with tokens. Cab thinks both have their limitations since private blockchains may prove to not be as valuable in the long-term, while public blockchains may be unable to scale and meet the needs of enterprises. The result is that there is a lot of room for innovation and it is still early days for blockchain on both sides, since neither can yet claim to meet the needs of every use case.
The final statement posed to the panel was that “implementing blockchain requires a big capital investment and finding someone with experience in the technology is challenging.” Overall, the panel seemed to believe that the need for a huge capital investment is a myth, though finding capable technology resources with experience in blockchain is still a limiting factor today.
Following the executive roundtable, Nicole Cathcart, Director of Innovation for Cambia Healthcare Solutions, took the stage to speak about identifying opportunities to implement blockchain within an organization. A good reference shared by Nicole during her talk is a rubric generated by the World Economic Forum, which steps through 11 questions to help assess the viability of using blockchain technology to solve a specific challenge or fill a given need.
Speaking more about her own organization’s experiences, Nicole provided another frame of reference for evaluating blockchain projects: considering the axes of transformational vs actionable. Some needs, such as paying employees or corporate asset tracking, have proven value and will generate internal support and familiarity within an organization making them very easy to put into action, though they don’t completely transform the way the business operates. Others, such as peer-to-peer insurance or consumer-to-provider contracting, are newer concepts and have the potential to transform business models but are less actionable due to their novelty.
A specific example of an idea once explored at Cambia that sits high on both axes is prior authorization. Nicole’s organization estimated that the cost of a physician interacting with health plans by filling out and faxing forms for about 20 hours per week represented a cost of $83,000 per physician. Failure to secure prior authorization is also very disruptive to the consumer experience, especially when a patient needs to pay out of pocket for a procedure. Smart contracts implemented using blockchain technology could automate the execution of prior authorization by pulling relevant background data from the electronic medical record (EMR) and using the data to execute a decision on an authorization through a rules engine.
Jennifer Georgino, Contributor to Blockchain Healthcare Review, moderated the next session featuring David Houlding, Director of Healthcare Privacy & Security at Intel, and Adrian Gropper, CTO of Patient Privacy Rights. Commenting on the use of blockchain in healthcare, David believes that personal health information, which he defines as anything that can locate, contact, or identify an individual, should be kept off-chain. Instead, blockchains should hold unique pointers, similar to Kyle’s library card catalog analogy from earlier, that are unrelated to sensitive information. In this way, if a patient no longer wants to participate in a network or wants their data forgotten, their off-chain information can be removed essentially, de-identifying the patient from a blockchain. Another consideration mentioned by David are the data retention laws, like HIPAA, that sometimes conflict with patient requests for deletion of information.
Adrian presented a strong perspective on the concept of public versus private blockchains. In banking, as an example, private blockchains are being considered among networks of banks. In that situation all banks have an interest in knowing the correct distribution of financial assets. However, if you take a network of hospitals and create a private blockchain among them, now each hospital will potentially be able to see how many customers the other hospitals have, the frequency of patient visits, and other information hospitals consider proprietary today. The distinction, Adrian contends, is that in healthcare assets are not fungible, creating a difference in motivation of network participants. Generalizing the point, there are still competitive concerns with assets on a blockchain. Organizations begin to get wary when you ask them to put information on a blockchain and trust that competitors cannot take advantage of what they learn.
A more contentious discussion point during the session focused on the elephant in the room of EMRs who all manage their own, proprietary data silos of medical information. David believes a common denominator of EMRs is that they are customer driven, meaning it will be the providers who will end up demanding to have data made available through blockchains. Adrian, on the other hand, agrees that blockchain technology enables physicians and patients to become consumers, but pushed back on their ability to enact change given that these entities are not used to being consumers with market power over EMRs. Additionally, Adrain pointed out that EMR vendors are facing the challenge of being told to both provide availability and functionality for consumers in an efficient way but that these services will be available to patients, who have a right to their information, free of charge. The result is that EMR vendors end up being marginalized.
The last session of the day came from main event sponsor Luxoft speaking about their experience leveraging blockchains in healthcare. Medgadget had a chance to sit down and speak with Luxoft during the event. Stay tuned for more on that interview as well as coverage of Day 2 at “Healthcare on the Blockchain.”