In medtech, we always look for ways to provide value to the clinical decision maker. Blockchain is an exciting new tool that creates new opportunities in medtech to additionally provide value to hospital administrators, such as the Chief Financial Officer (the ultimate decision maker in the hospital VAC) in a period where CFO confidence levels have fallen regarding their ability to adapt to changing business conditions. Directionally, this decrease in CFO confidence is a bad trend for hospital decision making and cost management. In an annual survey (1) of hospital CFOs (n=160):
Only 13% of CFOs said their organizations are very prepared to manage evolving payment and delivery models using their existing financial planning processes and tools, compared with 15% in 2017.
A mere 23% of CFOs said they were very confident in their hospital administration team’s ability to rapidly and definitively adjust strategies and tactics, down from 25% in the last survey (2).
96% stated their institutions should do more to leverage data to update and assess strategic decisions.
94% state that pressure is increasing to gain greater insight into how financial results impact business strategy.
Blockchain in medical devices
Blockchain is a tool that allows nodes (digital connectors) to exchange information and assets without the need of a centralized system that controls access. Information exchange and sharing can happen near real-time across the entire network of nodes. Three characteristics make blockchain unique for medtech:
A sequential chain of code (blocks) that include protected data. Each block on the chain:
• References the block in the chain before it
• Contains specific information based on the purpose of the chain
• Is almost impossible to change once a block is added to the chain through the consensus of the majority of nodes
Smart contracts establish a methodology for blockchain nodes to work with each other.
• These are small aggregates of code that create rules the node network always follow.
• The node network assesses all transactions before accepting a new one into the blockchain network.
While some blockchains can be public, like Bitcoin, healthcare nodes limit access.
• Where data access is closely controlled, such in information protected by HIPAA, data will only be disclosed to nodes that have established permission.
Use Cases for Blockchain in Medical Devices and Digital Health (3)
Use Case 1. Protecting Patient Data
Many medical devices can gather, collect, and communicate patient-specific data. For example, information from devices implanted in patients can be shared with healthcare providers.
Blockchain provides cryptographic protection that is not available with conventional data storage/communication processes.
Hacking is possible when data is centrally warehoused and communicated.
Use Case 2. Maintenance for Medical Devices
Medtech applications for blockchain enables sharing of operating data without compromising privacy and compliance. Blockchain can keep service archives for a device with an expiration date, to identify the viability of a power source, such as a battery, or specific identification numbers such as Unique Device Identification (UDI).
Use Case 3. Medical Device Supply Chain
Blockchain can keep a record of the manufacturer, part numbers, production history and distribution of medical devices and log documentation of supplier components. Of critical importance to medical device manufacturers is that once information enters the blockchain it cannot be altered, providing traceability for each medical device.
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Blockchain Applications in Medtech and Value Based Care
Select a use case where a blockchain solution can bring quick value. For example, in pacemakers, precisely monitoring and communicating battery life could reduce the cost of care for hospitals and payors by automatically signaling when battery life is declining. Blockchain can ensure that this data is secure and provides an auditable trail.
By increasing confidence in data communication through blockchain, clinicians can increase the accuracy of their diagnoses, possibly improve patient outcomes, all while reducing risk for the organization. This will help hospital administrators. In the survey, CFOs stated that their core dimensions of organizational performance were:
Financial health (85%)
Patient experience (80%)
Quality of care and clinical outcomes 80%
These last two affect reimbursement and performance under value-based payment structures. In our physician interviews, doctors tell us about “low hanging fruit” and medical device unmet needs where improved confidence in ongoing performance of a medical device can be enabled through increasing the level of securely delivered information about that device. Be sure to look at blockchain as you develop your digital medical device strategy.