We all know that blockchain technology is set to transform each and every industry that we have in the near future, and health insurance including its insurers, is never far behind.
The 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 key characteristics of the blockchain include:
- Consistent accessibility
- Strong data integrity
- No central point of control
- And network-wide public accountability
Not only does the blockchain give insurers a secure outlet to store personalized health information and payment plans, but it also gives policyholders ‘always available’ access to those records.
As a result, the healthcare industry is seeing a 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 or startups 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 is 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, they’re now able to send and receive information solely related to that case. The peer-to-peer (P2P) freedom and privacy blockchain offers are 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.
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.
Developments regarding technology in healthcare are notoriously slow, partly because of the grave consequences of failure. After all, we’re talking about people’s lives here. This being said, most superficial risks can definitely be avoided with the right type of guidance and support.
For instance, developers with blockchain expertise aren’t common, so it’s important to link up with networks that can provide (and train) you with skilled data employees.
Overall, blockchain presents many promises, but it also holds a few pitfalls as we’re still in the early stages of discovery. Insurers should stay optimistic, proceed with caution, and not hesitate in seeking expert assistance in traversing the coming waves.