In Blockchain

Blockchain first achieved widespread attention in the financial services realm as an infrastructure for cryptocurrencies. Now, this next-generation technology is gaining traction in healthcare for its ability to improve the integrity, auditability, and efficiency of healthcare processes, starting with managing medical claims. The structure of the blockchain makes it easier for healthcare payers (insurance carriers, health plans sponsors such as employers and unions, etc.) and providers (doctors, dentists, hospitals, health systems, etc.) to process claims quickly, accurately and with greater transparency. The resulting efficiencies can help reduce the cost of administering claims and improve the quality of communication across the industry.

One of the biggest complaints in healthcare today is the inherent complexity in interactions between payers and providers. Patients caught in the middle are often confused about when—or if—medical bills are paid and how much they owe after insurance kicks in. Aaron Symanski, chief technology officer at Change Healthcare, believes blockchain technology can help streamline and simplify those interactions and others, such as tracking what happens to a patient during his or her healthcare encounters. That’s because at its most basic, blockchain is a more efficient way of capturing and relaying events so that all parties stay in sync.

“Blockchain is a distributed ledger that allows all participants—in the case of medical claims, hospitals, physician practices and payers—to see and track, in real-time, the status of claims and remittance without the need for a central database,” explains Symanski. “Instead, the event data is recorded in such a way that the participants in a claim process receive the same updates, eliminating the time-consuming back-and-forth that comes from checking to be sure that everyone has the same version of events. In addition to improving efficiency, this provides an unprecedented level of transparency and greater visibility to the status of claims throughout their lifecycle.”

Recognizing the potential of blockchain to improve the cost/quality equation, Change Healthcare became the first healthcare organization to become a Premier member of The Linux Foundation’s prestigious Hyperledger consortium. This group—comprising more than 230 members in fields such as finance, technology, and aeronautics, to name a few—came together with the goal of furthering blockchain’s distributed ledger technology across multiple industries.

Change Healthcare has been a strong advocate for the technology, the first to make blockchain at enterprise scale available for its healthcare customers who use the Change Healthcare Intelligent Healthcare Network™. Hundreds of thousands of physicians, hospitals and other providers as well as commercial and government payers rely on the network every day to process claims representing more than $2 trillion each year.

That’s just the beginning. Change Healthcare is also exploring other uses for blockchain, such as following a patient through a clinical encounter. For example, consider an individual who schedules an outpatient procedure that includes an MRI. If the payer and provider were using blockchain, the insurance company would be able to see when the patient has scheduled an MRI and give pre-approval for the procedure. When the MRI occurs, the provider—using blockchain—would note that the procedure had taken place. Such an exchange would allow the payer to put through the payment for the MRI that day.

“Blockchain creates an audit trail that everyone can see in real-time,” Symanski explains. “A participant can add data without changing what already happened.”

Because the insurance company can put through reimbursement information to the doctor almost instantaneously, the patient will know what he or she owes in the form of a co-payment or other amount before leaving the doctor’s office or shortly thereafter. This eliminates the costly paper trail of statements and bills among all three parties, saving time and money. When the doctor, patient and insurance company have a shared set of facts, they can synchronize their activity. “The cycle of treatment, billing and payment can be compressed because nothing has to be reconciled,” he notes.

While blockchain is in its early days where healthcare is concerned, Symanski is confident that different constituents will recognize its value fairly quickly. “For providers, blockchain can provide a way of getting paid faster,” he notes. “For payers, it enables more than a transactional relationship with doctors and patients. Payers want more information than ‘Do I pay this claim or not?’ They’re trying to manage their risk, their provider networks, and get better visibility into their own cash flow management. Blockchain can help them do that.”

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