Blockchain is poised to become the next big healthcare innovation, and both insurance and provider organizations see real value in it.
The technology that began with Bitcoin in 2009 promises to provide the safe, interoperable sharing of real-time data between providers, payers and patients.
Blockchain can help payers and providers sort out payment disputes by automatically verifying and authorizing information, leading to faster claims payments. It can also be applied to population health by giving providers and payers access to patient databases.
And in prior authorization, a physician can use blockchain to instantly make the request to the insurance company, cutting out middlemen for direct access to safely encrypted information.
Humana's Chief Innovation Officer Chris Kay said blockchain eliminates the need for a third party to leverage and distribute data. Transactions can close in real time.
"Everybody that is part of transaction has access to the network," Kay said. "There's no need for an intermediary. Blockchain allows for verification instantly."
Blockchain offers transparency and security at a reduced cost, said Aetna's Abbie Barbir speaking at a HIMSS17 session in Orlando this February. Barbir is senior security advisory, Mobile Security Innovation, Global Information Security, for Aetna.
The ability to share and exchange data in an interoperable fashion can result in significant cost savings and enhanced security, he said.
Humana CEO Bruce Broussard has also called blockchain the next big healthcare technology innovation. But the concept of blockchain is still so new that it's not yet widely embraced by the industry.
"Few health insurers are actively investing in blockchain now as it is still very new, but some are starting to consider investments and piloting the technology," said Sarah Thomas, director of the Deloitte Center for Health Solutions. "Many health insurers are still trying to understand the full capabilities and requirements of blockchain, and how it could fit into their future technology strategy."
Ninety percent of the dollars being invested in blockchain are not going into healthcare, but to Bitcoin or financial companies, according to Healthcoin CEO Diego Espinosa.
"The investors are coming," said Espinosa, who has a finance background in hedge fund management. "We'll start to see it emerge in 12 to 18 months."
"This is very emerging technology," Kay said. "It's in the exploration phase."
Blockchain has been described as an encrypted distributed ledger. Each transaction is a block on the ledger, linked as a chain.
"Everyone has to have node on the blockchain and have a server linked to the blockchain. The servers are the ones talking to one another," Kay said. "What's really transformative about this is it takes the friction out of the system. If I see a doctor, the doctor knows what insurance I have because it's on the network. The verification can happen immediately. All this is verified through underlying security software."
The technology is not for technology's sake, Kay said, but as a means of simplifying and improving the health experience for members.
"This is consumer-first technology," he said. He predicts blockchain will become a step up from the current system of electronic medical records.
"Around (interoperability) grew up healthcare technology of walled gardens of EMR," Kay said. "We all feel the friction, it's not easy for information to move around the system."
Thomas said blockchain is uniquely positioned to help with interoperability because it is able to bring decentralized entities together while enhancing data security.
"Blockchain's automated data verification capabilities, in particular, are able to resolve many of the trust issues regarding pulling data from disparate sources," she said.
Espinosa has been building Healthcoin in Portland, Oregon, since July 2016 and expects to launch the blockchain-based company in June.
The company is focused on diabetes prevention through the use of incentive tokens posted to blockchain.
Espinosa began Healthcoin after he was diagnosed as a borderline diabetic, a diagnosis that half of Americans can expect to get, he said.
"There's a 50/50 chance over the age of 40," he said. "I managed to reverse my diabetes."
He then wondered about how he could quantify the improvement.
The token healthcoins let not only the patient, but the provider, insurer and employer -- if directed by the consumer on a user permission basis -- know his or her health is improving.
"By tokenizing this, it shoots up a flare," Espinosa said. "The payer is watching it."
Healthcoins could be used as the basis for rebates from insurers, or cash payments from employers investing in health plans.
"That's the plan, it's the basis for a discount," Espinoza said.
This is not competing with incentive plans on wellness being offered by insurers, he said.
"We're not trying to change all that, we're trying to add an element," Espinosa said. "If you're an insurer, you can really show what's working and what isn't. In a value-based world this becomes more significant. It's really saving on healthcare costs."
The healthcoins are also mobile, moving with the consumer as the beneficiary switches jobs, insurance and locale. If it's on the blockchain, the healthcoins can be recorded to a different insurer.
Currently, there's not necessarily a connection between what the doctor, patient and payer know.
"What we're really trying to do here is to allow the value that gets generated by prevention to be transparent, and to be captured by all the people who are involved in it," Espinosa said. "We've become a beacon, here's a better way to run an incentive program ... we can bend the cost curve."