February 26, 2017 | Written by: Srinivas Attili
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This is the second article in the Q&A series where we discuss the findings reported in the IBMs Executive Report on Blockchain in Healthcare. Here we hear from Srinivas Attili (Vice President & Partner, Application Innovation Consulting, US Public Sector & Healthcare) who leads IBM’s Application Services Go-To-Market practice for Public Sector including State and Local Governments, Higher Education and Healthcare industries.
Srini has over 15 years of Technology Consulting and System Integration experience leading capture and delivery of several mission critical programs. He holds several patents in the Analytics space and has expertise in Healthcare, and Federal (Homeland Security, Immigration, Defense) industries with a strong track record of growing market share, revenue, profitability and delivery of complex systems integration, cloud solutions, information management, big data and analytics programs.
The IBM Institute for Business Value’s (IBV) latest study on how blockchain is applicable to the healthcare industry, surveyed 200 healthcare executives in 16 countries, who shared that surprisingly 16% of healthcare institutions – Trailblazers – expect to have a commercial blockchain solution at scale in 2017.
Q. In your experience what type of organizations are interested and ready for the implementation of blockchain, and what is it about these organizations which differentiates them?
A. There are three types of healthcare organizations who are potentially interested in utilizing blockchain:
1) Organizations that exchange value in an ecosystem – requiring trust, security and verified identity.
2) Organizations that act as intermediaries – payors, ACO’s, PBM’s in the healthcare word.
3) Regulated organizations like in healthcare where transparency and compliance to regulations is paramount.
The areas ripe for blockchain are areas where the data exchange is inefficient (for example health care data between patient, payor and provider) and where data stays and is duplicated in organizational silo-es, delays persist to complete transactions (claims, prior authorization) as every party has their own ledger of data/transaction and don’t have visibility to the other parties’ ledger. In such situations blockchain technology could improve data movement efficiency reducing time and costs.
Q. What would motivate/influence healthcare network participants to invest in Blockchain technology?
A. As discussed above a main potential benefit of blockchain is in efficiency – in processing times, quality of data, time to settle etc. Additional benefits which will motivate uptake include established trust between parties, eliminating intermediaries in certain instances, accurate/real time view of data across the network, one set of rules using smart contracts across the network, and potential new ways/applications to serve clients over a common blockchain.
However concerns remain around the ability to Scale and getting the network participants to agree on common rules/smart contracts. As is common with any new technology there are concerns around risks associated with it and, evolving standards- hyperledger
The top frictions or challenges identified by the survey were ‘imperfect information’, ‘information risks’, ‘inaccessible information’ and ‘inaccessible marketplaces’[Imperfect information: Decision making impeded by inaccurate, misleading or incomplete information. Information risks: Risk of technology breaches and tampering that are difficult to plan for. Inaccessible information: Shortage of information because of standards issues or shortage of scalable computing power and storage. Inaccessible marketplaces: Assets that are underutilised or unmonetisable and do not contribute to revenue growth]
Q. Could you provide an example of a client that currently struggles with one of these frictions under their current business model?
A. Take a payer as an example, the data they get about a patient’s encounter(s) with the provider(s) is imperfect. First they get the claims data submitted by the provider which might be delayed/old based on how fast the provider submits a claim to the payor after the patient encounter. And if the patient sees multiple providers (pcp, Specialist etc) – each of them have their own EMR system and interoperability is an significant barrier. So, for a payer to have a 360 degree view of their patient and make decisions on care management, actuarial projections, outreach and engagement it is based on imperfect information.
Q. ‘Providers regard blockchains as an opportunity to go after and enter new markets, payers to defend against invisible threats, which include new competitors and business models that are difficult to anticipate’. How can providers and payers begin to make measurable progress in achieving the anticipated benefits of blockchains?
A. Start with introspecting existing processes and use the lens of blockchain to examine them – are there multiple participants in the process, do they all maintain a separate record at different stages of the process, is the data silioed across the participants, is there an intermediary the parties are relying to validate the transactions and establish trust, are there delays being introduced in the process due to lack of visibility of decisions and data? If the answer is yes to any of these questions, we should baseline the current cost (time, money, opportunity cost) of the current process and disrupt it with blockchain and track progress on key performance indicators. IBM developed an approach to implement a shadow blockchain to understand the impact on the process and anticipated benefits before shifting the process to a blockchain based technology.
However, blockchain is not the answer for every problem out there. Before tackling a use case it’s important to assess the process we are trying to improve/implement using a structured framework. Start with introspecting existing processes and use this to determine which processes should be the first to focus on.
Q. Healthcare executives see immature technology and insufficient skills as main barriers to successful blockchain adoption. Who do organizations view as trusted partners to overcome the barriers to blockchain adoption?
A. The technology needs a system of transparent governance. Remember what guided the development of the internet: not-for-profit groups like the Internet Engineering Task Force and the World Wide Web Consortium. Their involvement gave businesses confidence that the internet would be stable and based on open standards.
The same must be true for blockchain. More than 80 leading finance and technology organizations, including IBM, have joined the Linux Foundation Hyperledger, a project aimed at creating an enterprise-grade blockchain framework. More than 600 additional firms have already applied to join the consortium. Firms that commit to open standards and demonstrate their commitment are viewed as trusted partners.
Q. Which participants are critical to the blockchain efforts in healthcare who are not yet on board – regulators, blockchain tech providers, established consortia, government agencies, pharma, med device cos, patients maybe?
A. Blockchain is about bringing trust into transactions across participants in a network. When we are disrupting an existing process with blockchain it is critical to have all participants in the process to be on board and bought on to the approach. Depending on the use case, we need regulators, payers, providers, PBM’s and pharma to commit to the technology and reap the benefits.