Blockchain in the healthcare sector

Healthcare is the largest sector in most G7 countries, amounting to over 16% of the US gross domestic product (GDP). Singapore, currently ranked one of the best in healthcare by Statista, announced that its National Health Expenditure could increase to $43 billion in the next 5 years, accounting for as much as 9% of the GDP in the same period. The healthcare system generally has seen a rise in demand, and many countries are pumping funds into the sectors that have witnessed the most innovative change in recent years. The significant transformation in the healthcare system is driven by cutting-edge technologies such as blockchain which has demonstrated game-changing potential for facilitating secure and efficient data sharing in the system. In an era characterised by increasing digitisation and a vast population, efficient data management and patient data protection are paramount. The fusion of blockchain technology, internet of things (IoT), artificial intelligence and digital assets marks a paradigm shift in healthcare. Addressing the challenges of security, privacy and transmission of health data, fostering trust through transparency, streamlining administrative processes and enhancing a patient-centred approach all demonstrate this. Precedence research sums this up by predicting the global blockchain in healthcare market size to hit around $14.25 billion by 2032, with an anticipated CAGR of 34.02% from 2023 to 2032.

Blockchain technology has numerous use cases in the medical industry, inspiring the improvement of different aspects of the sector. In addition to being a catalyst for accountability, its secure, tamper-resistant and accurate nature makes falsification or manipulation of data nearly impossible. Healthcare data management, security and dissemination are certainly important but equally complicated parts of the healthcare system. And, despite technological advancements, the medical industry still faces significant obstacles ultimately preventing efficient and secure healthcare information management. According to the 2021 IBM security report, at $9.23 million per incident, worryingly, the medical industry has the highest average cost of a data breach. Insider threats, ransomware and phishing attacks are possible causes of breaches whereby resulting in decreased patient trust, damaged reputations, legal penalties and financial losses. Despite governments’ extensive frameworks to regulate and protect personal health information, such as the Digital Personal Data Protection Bill in India and the United States Health Information Technology for Economic and Clinical Health (HITECH), there have been records of sensitive data leaks. However, through encryption, access control and authentication, blockchain technology undoubtedly improves security, provides privacy and prevents hacker attempts. Blockchain’s decentralised and immutable architecture not only prevents manipulation and fraud but also gives patients full ownership of their medical data and prohibits healthcare providers from accessing information without patient permission. In addition, role-based access control is essential to maintain security, transparency and auditability. Nonetheless, lack of standardisation among the healthcare stakeholders results in data silos and fragmentation that are difficult to integrate. The isolation is a challenge to co-ordinated care with the consequences of increased administrative burden and the possibility of errors. But a blockchain-based application offering connectivity between existing electronic health record (EHR) systems at different healthcare institutions enables healthcare system interoperability; the technology’s ability to eliminate intermediaries and simplify data sharing improves care co-ordination and patient outcomes.

Another key area in the healthcare sector is supply chain management - from raw material gathering to delivering the products to the end user, supply chains involve complex processes completed in different stages. Supply chains with a detailed record of products at every stage are essential to reducing the prevalence of counterfeit items in the healthcare industry. Hence blockchain technology reduces any trust obstacles, automates order placement through smart contracts and improves inventory management. Examples of this are FISCO BCOS (a reliable and high-performance blockchain platform) which is used in vaccine safety systems to trace vaccine supply from manufacturer to customer, and eZTracker, the product of Zuellig and Merck’s partnership which is devised to trace Human Papilloma Virus and COVID-19 vaccines, so preventing people from receiving fake or expired vaccines. Blockchain plays a pivotal role, without doubt, in tracking medical devices and clinical trial supply chain so ensuring transparency, safety and reliability in these fields. It also reinforces trust when conducting clinical trials by addressing the issues of false results and data disintegration. The technology provides clarity and identification of false content, maintaining transparency and security for data and therefore assuring data credibility and accuracy. Blockchains can also help to address the challenges of fraud in clinical trials and streamlines trial processes. Embleema (designed to revolutionise clinical trials and regulatory analytics) enables participants to virtually approve the collection, storage and analysis of their health data whereby facilitating the development of new treatments and improving overall healthcare outcomes.

Yet, despite its potential benefits in healthcare, certain issues must be addressed for the smooth transition and adoption of blockchain. The immutable nature of the technology has the potential to provide challenges since errors or inaccurate data could prove difficult to erase or modify once posted on the blockchain. Every participant in the network can access the data stored on a blockchain, therefore data privacy and confidentiality depend on the professionalism of the healthcare provider. Adoption and implementation of blockchain rests on its perceived performance which, in turn, is measured by throughput and latency. Throughput (measured in transaction per second - TPS) is the number of transactions processed within a specific timeframe, whilst latency refers to the time taken to finalise a transaction on the blockchain after submission; both are critical performance indicators for assessing the consensus mechanism. Generally, platforms that use proof-of-work (PoW) consensus mechanisms have low transaction throughput. For instance, Ethereum’s throughput is between 15 TPS to 30 TPS, whilst Bitcoin generally has 7 TPS. With the growing storage requirements of blockchain systems, low transaction throughput becomes a major scalability issue, but off-chain computing (such as offered by Layer 2 solutions) can partially resolve scalability issues in healthcare models. Layer 2 solutions, such as Bitcoin’s lightning network and Ethereum’s plasma, execute some transactions off the chain and store the execution results on the chain. In healthcare, massive amounts of data, including medical records, test reports and other forms of graphical data, need regular processing. Unsurprisingly, the storage capacity of blockchain becomes a challenge as the data volume increases - simultaneously, the storage costs also grow. Blockchain Layer 2 models, such as BigchainDB, stand to address the storage limitations as they process transactions off-chain and submit the final state to the blockchain, increasing the data speed and processing whilst ensuring security. Medifakt is another blockchain platform that combines blockchain technology, IoT and machine learning to enhance secure sharing of medical data within and across specialties - it supports the storage, evaluation, interpretation and transfer of medical data and images. However, those healthcare providers used to the traditional medical record management systems may find adjusting to blockchain-based healthcare medical records initially a challenge. Workers and stakeholders may need additional training to use the new computerised system.

Reassuringly, so as to protect healthcare data, countries worldwide have implemented data protection laws and regulations, although the adoption of blockchain-based solutions in such countries does depend on their compliance with the already established regulations. Furthermore, achieving the goal of blockchain’s use in data management hinges on the ability of different systems and organisations to exchange and collaborate using data. Teamwork and compliance with applicable regulations are required for exchanged data to be accurately interpreted whilst preserving the meaning and context within which the data is exchanged. Lack of interoperability protocols and standardised data format presents a challenge to sharing and integrating medical data between hospitals and healthcare providers. Different healthcare providers or institutions have various characteristics and standards and may be based on different blockchain platforms. Furthermore, interoperability between these multiple blockchain systems presents another challenge. Across the globe, many blockchain-based health information management platforms, such as Patientory, Medicalchain and BurstIQ enhance interoperability between different healthcare systems, facilitating data sharing and seamless communication among stakeholders whilst maintaining patient privacy. So, although blockchain's integration into healthcare is poised to redefine the sector, the journey is far from straightforward. As one of the most critical industries globally, healthcare has historically combatted inefficiencies, security breaches and data fragmentation. Blockchain offers a tantalising promise to address these issues by ensuring transparency, security and interoperability - but is it enough to overcome deeply ingrained systemic challenges? The promise of blockchain in healthcare is clear, but its realisation hinges on tackling pressing challenges. So, can stakeholders overcome the lack of standardisation, ensure compliance with global regulations and foster interoperability across diverse systems? And most importantly, can blockchain truly democratise healthcare, giving patients control over their data whilst maintaining privacy in a system that is inherently transparent? The road ahead is challenging, but the stakes could not be higher. As healthcare continues to evolve in an increasingly digitised world, blockchain stands as a disruptor with the potential to revolutionise the sector - but only if its promise can outpace its hurdles.