Even as U.S. healthcare spending grew by 3.9% in 2017, the system remains riddled with waste, inefficiencies and data silos. In response, a consortium of healthcare giants that include Aetna and Anthem are testing out blockchain technology as a possible fix.
On Thursday, IBM announced that the consortium, which also includes PNC Bank and Health Care Service Corporation, will experiment with a version of blockchain known as Hyperledger Fabric in a bid to reduce administrative errors and streamline record keeping.
Blockchain is a distributed ledger system run across multiple computers that creates an indelible, tamper proof record system. It is gaining traction in industries like finance and shipping, in part because it can be an efficient way to provide access to sensitive data.
Bringing the technology to healthcare is likely to prove daunting, however, given the scale and complexity of the industry. According to Barbara Hayes, an executive within IBM’s health division, healthcare has been a laggard in technology due to the prevalence of legacy systems and the large amounts of data scattered among many participants.
Hayes, though, thinks blockchain is one of two technologies that are an ideal fit for the healthcare industry (artificial intelligence is the other one), and that will soon transform it.
In an interview with Fortune, Hayes cited “revenue cycle management” and “bundled payment solutions” as areas where blockchain could improve outcomes, but did not provide more details or cite any specific examples of how exactly this would occur. She stated instead that the members of the consortium would create specific applications by working together.
The new initiative comes at a time when some are questioning whether technology may in fact be exacerbating some of the inefficiencies in the health system. In a widely read New Yorker article last fall, titled “Why Doctors Hate Their Computers,” a surgeon described how mandatory “screen time” had reduced the amount of time many physicians could spend with their patients. In this context, an attempt to overlay yet another layer of technology—blockchain—onto the system could yield further frustrations.
In any case, IBM is not the only company promoting blockchain in the health sector. Wal-Mart last year obtained a patent to use blockchain for medical records, and researchers at hospitals around the world are experimenting with it in everything from patient records to diagnostics. Meanwhile, a pharmaceutical industry consortium launched an initiative in 2017 called the MediLedger Project, which seeks to better track pills across the supply chain.