Why the Health Care Industry Has Little Patience for Blockchain

Blockchain technology can safeguard electronic health records, trace pharmaceuticals and track clinical trial data, but few developers are building prototypes for this potentially lucrative field, according to Emily Vaughn, blockchain product director at Change Healthcare, a health care technology company.

That’s because health care is a cautious industry. It’s highly regulated, and any changes to the way things done are typically proven in other industries before they can be applied to anything that could affect human health.

There are plenty of obstacles to blockchain’s acceptance. “There’s skepticism around blockchain’s scalability and security,” Vaughn tells ThirtyK. Many health care providers, payers, pharmaceutical companies and regulators have only a nodding acquaintance with blockchain, and there are few applications in use.

“It takes time and persistence for these ideas to take hold, but more and more enterprises are seeking blockchain consulting and prototypes,” Vaughn says.

Overcoming this chicken-and-egg scenario requires more user education and “fully developed applications and development tools that make it easier to interact with blockchain networks,” she says. A regulatory nod of approval would help, too.

Further slowing adoption, the U.S. health care system is distributed, with many different providers and payers, each with their own technology preferences.

A Complex Supply Chain

“The biggest obstacle to using blockchain in health care is the lack of data sharing,” Melanie Nuce, blockchain expert and senior vice president of corporate development for the information standards organization GS1 US, tells ThirtyK. At a patient level, for instance, electronic health records (EHRs) may not be compatible with EHR technology in other health care systems. At a pharmaceutical level, it still can be hard to quickly and accurately trace ingredients, manufactured lots and individual doses through development, manufacturing and delivery.