A blockchain is a transactional ledger. It records transactions, the movement of anything of value from one party to another. 

What makes blockchain unique it that is a distributed ledger, which means a network of transactional partners can share a single copy of the ledger. Rather than having one copy of the ledger, held by one centralized party, every transactional entity has their own copy. And what’s most important to understand about blockchain is that the technical architecture solves the reconciliation problem. 

It is also a distributed ledger, which means that when we make a transaction, we broadcast that transaction to a network of transacting parties, all maintain a copy of the ledger. Blockchain is a secure transactional layer and transactions get recorded in the ledger and cannot be changed by any single party, therefore it is safe to be distributed among multiple transacting parties. 

I believe that blockchain is a transformational technology for the healthcare industry. It is a technical architecture, not a single piece of software, but solutions can be built to address the long-standing issues of the healthcare industry. 

The fundamental problem in the healthcare industry is called by many different names. From the clinical side it can be called lack of interoperability or revenue cycles problems from the payment side or supply chain problems from the movement of pharmaceuticals and supplies. 

However, all these problems come down to one core issue: transactional inefficiency. 

In the healthcare industry is almost impossible to achieve transactional efficiency. Even the simplest procedure triggers a transactional cascade. Let’s take prescriptions as an example: a physician writes you a very simple prescription for an antibiotic. Electronically issuing that prescription to you it triggers a cascade of backend administrative transactions before that drug reaches your hand. There will be benefits checks and investigations to see if your insurance will cover this, there might be prior authorization to be checked to see if you are able to receive that drug or other drugs might be preferred and then there is the supply chain, to see if the pharmacy you want to purchase that drug has that drug. All of these admin transactions take place in isolation from each other. The crucial data of finding from one transaction is not necessarily shared with those others admin transactions. What that means for the patient is that creates delays. We all had this experience in waiting. And those delays are mostly associated with transactional inefficiency.   

Past attempts to solve this problem have usually followed one of two routes: either healthcare enterprises are forced to build one off digital connections with transactional partners which either break or are unreliable or simply can’t move the data in a secure way. Or, we move the data through a third party, a middleman, whose sole purpose is to securely move the data from point A to point B, across the healthcare industry, adding costs and further inefficiency to these transactional processes. 

Blockchain can offer a new path forward. This digital architecture will allow multiple transacting parties in healthcare to securely share a transactional ledger. And when I talk about transactions means the movement of anything of value, whether that’s money, data, valuable goods, high value assets. It doesn’t matter what the transaction is. Blockchain can securely communicate the movement of that data, the movement of that digital asset, between multiple parties. And because it’s a distributed ledger blockchain allows multiple enterprises to have real time transparency into the state of these complex health care transactions. 

Blockchain becomes that common transactional layer that sits between multiple transacting enterprises and it takes a lot of the inefficiencies and pain points  that we all have experienced in the delivery of the healthcare industry.

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