Blockchain technology is set to transform health insurance. Blockchain is a relatively new data structure anonymously introduced to the world in 2009. Being a digital ledger of transactions between a public network of computers, the blockchain allows each participant (through complex algorithms and cryptography) to securely manage their own data, without the need for a central authority.
The Rise Of Blockchain In Healthcare
As a result, the healthcare industry is seeing huge advantage in adapting blockchain to its companies. But in order to maximize its usability, most (if not all) must participate in the public network. In fact, current insurers partnering up with blockchain-linked businesses are already seeing impressive innovations in their sphere of influence.
Since blockchain permanently logs all transactions between its participants, it offers a level of transparency not available in the current paradigm of the insurance world. There are often multiple levels of middlemen throughout the lifecycle of a health insurance policy. Information is shared between several stakeholders, but it takes forever for the cycle to go from one end to the other. The process is riddled with inefficiencies and blockchain can help with that. For example, applying automation to blockchain-developed programs, patients can establish ‘contractual agreements’ with hospitals, physicians, and pharmaceutical companies. Completed transactions between parties take up a ‘block’ that’s subsequently linked to the ‘chain’, and over time results in a dependable record of all concurrent interactions. As an illustration, take your standard health plan agreement, where each party would usually give the other a paper contract while dealing with various third-party entities.
With blockchain technology, each participant can now individually (and digitally) load only the information that’s relevant to their shared contract. This way when a transaction is being executed, everyone involved can view the status, history, and process of what’s being authorized.
Hypothetically, if you ever need a specialized health professional (like an orthodontist to treat your sudden wisdom tooth impaction), they’re now able to send and receive information solely related to that case. The peer-to-peer (P2P) freedom and privacy blockchain offers is what’s making it an incredibly valuable proposition for the industry.
How Insurers Will Benefit From Using Blockchain
Presently, a handful of health insurance companies are working on projects incorporating blockchain technology to accelerate their growth and market share. Since it’s a relatively new development, smart insurers are paying extra attention to the long-term benefits — while remaining focused on maintaining short-term vigilance.
For example, The Office of the National Coordinator for Health Information Technology, in response to the blockchain challenge (where everyone needs to participate in order to maximise usability), is now spreading awareness through white papers on the technology and its potential use in health IT “to address privacy, security and scalability challenges of managing electronic health records and resources”.
Fortunately, there are great educational resources available to anyone aiming to stay ahead of the curve.
However, the days of using accelerator programs and bootstrapping methods to boost your business are waning.
Insurers can instead now work with digital transformation platforms to design and develop blockchain technologies to target specific needs instead of using a one-size-fits-all approach. But, targeting the right investments involves building an experienced team that knows what to look for in the clutter of emerging products and market developments.