How Blockchain will help fix the Opioid (and Healthcare) crisis- part 2
It’s not (only) about aligning incentives, it’s about creating Trust
In part one, I wrote that the opioid crisis is not a medical epidemic, but rather a social syndemic, (an epidemic of epidemics) and until we create a decentralized economy that will disrupt the current business model, the number of opioid prescriptions may decline, but the number of over-doses and deaths will continue to rise.
I predict that this disruption will occur in three steps:
- Transition to value base care to align stakeholder incentives will continue for the next 3–5 years
- In the meantime dozens of Blockchain-based solutions (BaaS) and platforms will appear
- These solutions will create a decentralized marketplace that will empower patients to become health and wealth producers instead of health consumers, and drive them to regain trust in the system.
1. Transition to value base care to align incentives will continue
On April 18, as part of the Trust Project at the Northwestern School of Management, over 150 physicians, nurses, CIOs of hospitals and large payors, representatives from pharmaceuticals and device companies and experts in healthcare IT gathered to brainstorm and possibly start to design a path to ‘fix’ the incentive structure in healthcare.
We divided into eight 90-minute work groups and for the next 6 hours we talked about the current transition from the traditional fee-for-service (FFS) to a fee-for-performance (F4P) or value-based care (VBC) business model.
Work groups discussed about what does value and quality mean; what is cost effectiveness; what are the keys for a successful VBC implementation; how can we redesign our current payment models, leveraging digital technology; how should we finance health care systems; how should we make sure these changes are done ethically and how will healthcare look like in the future?
We did not talk about what is blockchain; why does it matter; and what are some general case uses or specific ones in healthcare.
2. Dozens of Cryptohealth solutions are coming out this year
On April 12, Citi Equities held their 3rd annual Digital Health conference with one panel dedicated to Digital Healthcare solutions using blockchain, which included:
- IntivaHealth (a medical career and credentialing management platform built on Hashgraph)
- Patientory (a HIPPA-compliant secure platform to improve data access and patient care coordination)
- Pokitdok (a provider of cloud based APIs that simplify revenue cycle management and prevent fraud)
- TabulaRasa Healthcare (a medication risk mitigation platform)
Each CryptoHealth solution presented a specific quality of Distributed Ledger Technology as a component of a future Blockchain economy in Healthcare namely:
- Confirming identity and ownership
- Security, privacy, and immutability
- P2P transactions, simplification and disintermediation
- Interoperability
3. CryptoHealth solutions will create a decentralized market in Healthcare and if successful it will restore Trust into the system
Few in healthcare know about decentralization and why it matters. However they do understand incentives and not surprisingly most CryptoHealth solutions design a patient-centered token economy that look like this:
Healthcare professionals also understand the collapse of trust in the system.
Providers don’t trust insurers to reimburse for procedures due to the changing regulatory landscape and markets. Insurance companies do not trust providers, regularly contesting claims and adding to providers’ administrative burdens at an estimated cost of 10–14% of practice revenue. Patient trust in doctors and other healthcare professionals varies but trust in health insurance is consistently low.
One way to regain and rebuilt trust is to remove human fallibility and the temptation to corrupt or “bend the rules” in various transactions (scheduling, charging, prescribing). Encoding practice and business models into foundational blockchain protocols can provide clinics and hospitals the necessary smart contracts that ensure that customer experiences are consistent, efficient and above all transparent. Providing patients their own data while building win-win incentives based on Crypto-economic principles will require also the development of governance plans.
The current system is not sustainable. Costs are rising, life expectancy is declining and patients are overall unhappy. For skeptics who still do not see the role of blockchain in healthcare, I quote William Mougayar:
“The blockchain is custom-made for decentralizing trust and exchanging assets without central intermediaries. With the decentralization of trust, we will be able to exchange anything we own and challenge existing trusted authorities and custodians that typically held the keys to accessing our assets or verifying their authenticity.”
I believe Blockchain will help solve healthcare’s major problems. The Community needs to continue to work together to accelerate thoughtful implementation of projects that enables trust to permeate through the healthcare ecosystem.
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