In this era of digitalization, data is often considered the new oil. It’s highly valued, and like oil, can be transformed into something greater - information with consensus-driven provenance that has the power to influence decision-making and behavior, thus making a profound impact worldwide. However, without a transparent and secure way to share data, it becomes significantly difficult to optimize.
This begs the question; how do we improve data transparency and harness its potential? Enter blockchain technology – it has the ability to do both. First, blockchain enables transparency and traceability through immutable, shared ledgers. Since it’s founded on a decentralized platform, it gives all parties access to data while keeping it private through encryption. Second, it helps transform vast pools of data into information that can help doctors, patients, and health insurers make better decisions.
The power of transparency
While blockchain is arguably just as secure, if not more than other systems, its ability to improve transparency is what sets it apart. Blockchain doesn’t rely upon a central authority. As mentioned, it’s a distributed ledger that is shared across a network of connected computer systems, giving every participant access to the same data at the same time.
The benefit of transforming data
Blockchain transforms consensus-driven data into information, increasing consumer trust and benefiting the blockchain network and healthcare ecosystem.
Blockchain and healthcare use cases
Even though it is at a nascent stage, blockchain is proving to be useful in the healthcare sector for critical data and payment information. At Legato, we are exploring the use of blockchain to manage one of the most common business challenges - claim payment reconciliation process - which is both time-consuming and lacks transparency.
Use Case #1: Claim Payment Reconciliation
Provider and subscriber payments (checks, Electronic Funds Transfers) are reconciled with various banks through a legacy application. The reconciliation process happens in a nightly batch cycle, which causes a one day lag for status to be reflected in the system. This lag causes a lack of transparency. Providers have to call the customer care center to follow up on the status of a reimbursement or ask for the reissue of a check because of incorrect amounts or missing account details. From the payment perspective, it helps with both payables and receivables such as checking first party insurance liability, additional payments from providers, and any excess payments from members.
To address this challenge and have a more real-time reconciliation process, Legato has devised a solution by leveraging blockchain for payers, various banks, and providers. As participants of the blockchain network, each stakeholder can view and access all the information in the chain. With the help of Hyperledger Fabric (an open source blockchain software), Legato set up orderer and peer nodes for different organizations (members) and systems in the network. Detailed payment data points like check number, bank account number and provider details, are considered as assets to be handled in the blockchain.
Hyperledger Fabric offers a number of Application Programming Interfaces to support developing smart contracts (chain code) in various programming languages. Java script is used for developing smart contracts which enable the terms of an agreement between parties based on certain pre-defined criteria. Smart contracts are recorded on the blockchain have the ability to control blockchain assets, and are executed by the blockchain. Hyperledger Fabric provides an optional certificate authority service that can be used to generate the certificates and is the key needed to configure and manage identity in the blockchain network.
Whenever a transaction is triggered, an update will instantly be shared with the network and be visible at the frontend interface. Transactions like adding checks to the ledger, updating the status of checks, and reissuing the checks are generated using chain code/smart contracts.
This solution saves reconciliation time as ledger updates happen in real-time and, it gives stakeholders greater transparency about status payments. Also, it reduces the use of the customer care center since participants in the chain have real-time visibility to the status of a claim. Most importantly, providers can reissue or void checks directly from the frontend interface, which saves follow-up time and makes payment processing faster than other legacy processes.
Use Case #2: Provider Data Management
One of the biggest challenges facing the industry today is keeping provider data accurately updated. Billions of dollars are being spent on maintaining this data, yet there are visible gaps and errors.
Health plans need to regularly update provider data every three months as required by law. In today’s world, most providers are associated with multiple plans and because each plan is siloed providers have to duplicate work to keep records up-to-date, meaning they have to spend extra time and money to update every plan.
Apart from the tangible cost involved, there is more to lose. If provider data is not maintained and updated regularly, a patient could end up relying on inaccurate, outdated, and scattered information for timely treatment and care. This high cost, time-intensive and error-prone manual process could be avoided with blockchain intervention, which Legato is currently working to develop. In this distributed, decentralized multi-company blockchain every time a provider updates member information every computer on the network updates simultaneously. All that is required is a healthy collaboration between various stakeholders to ensure that provider data is routinely updated.
If successful, the benefits of this partnership will be immeasurable for the industry. With less duplicity and redundancy there will be immense cost savings for payers. Providers will not only benefit from better information resulting in improved patient experiences, they will also have the convenience of no longer having to update every payer separately – one update applies to all. Meanwhile, the entire industry benefits from new-found efficiencies.
Current challenges and how to overcome them
Being a relatively new technology in the market, blockchain can present several challenges. To start, there may be a lack of collaboration and willingness to share data among stakeholders. In addition, data protection and privacy limitations are intrinsic to blockchain. However, taking certain steps can reduce such issues.
Encourage and facilitate collaboration between different parties to leverage blockchain capabilities.
Communicate the collective benefits to those willing to keep the chain updated through data shareability.
Proactively manage the limitations of blockchain. For instance, since blockchain is a distributed ledger with no single data custodian, it can become difficult for the end- user, be it a patient or a provider, to exercise his right to the data in question. Consider implementing a consent process so that individuals have more control over their data.
The way forward
To change the future of healthcare, we have to take the first step. Adopting blockchain technology would increase data transparency and help optimize its potential in a wide range of practices – from real-time claims reconciliation to faster and more accurate patient diagnosis.
But that’s just the beginning. If cross-industry organizations come together and leverage blockchain, we could create a truly patient-centric and value-based ecosystem, one where data sharing transparency, improved healthcare processes, and more informed stakeholders become the norm.