Smart Health Networks
Today hight transaction and administration costs are a central issue within our existing health care approach. The dislocation caused by many siloed systems makes it hard to organize around the patient’s needs, while administrative costs remain high. The globalization of health, the movement towards the privatization of health and the advent of mobile health technologies, is creating an ever more complex system of service providers; the challenge is how can we integrate them within networks to really work efficiently and synergistically towards delivering end-user value rather than working to create an ever more complicated and fractured system with ever-growing layers of bureaucracy and regulation.
As looked at in a previous section the unbundling of healthcare organizations and services from our existing monolithic structure towards a more modular architecture will be a key structural transformation required to realize this. A combination of mobile technologies, blockchain networks, and smart contracts could be used to build a true service-oriented architecture to health systems; with the plug and play of devices, of services, of data. In this way we could move from a system that pivots around physicians, clinics and other institutions to a decentralized market for healthcare where modular service components securely registered on a blockchain are discoverable for multiple forms of flexible recomposition.
Mobile health technology is really more than just a set of devices and health gadgets, it really is the critical element for pushing the physical technologies outside of the walls of hospitals and clinics and putting them into the hands of the many. We can now start to put sophisticated monitoring systems and services in the hands of patients themselves and by doing so you can effectively push your healthcare provision all the way out to the patients where it is not only cheap and cost-effective to do so, but also minimally invasive and stressful for them also; it reduces bottlenecks, waiting times and dependencies.
Though surely the way forward mobile health technology also creates new challenges in that it requires the re-integration of all this data and information into effective processes and systems that can then use it to deliver the required service. Mobile health may hold out the promise of getting health technology outside of the four walls of medical centers and to turn the system into much more of a modular network but that network still has to be coordinated. It is this challenge and many other challenges similar to it in today’s health systems that require the coordination across a network of different components that blockchain based smart contracts could provide a highly effective solution to.
A myriad of contractual agreements sits behind a medical procedure of any complexity which works to create expanded bureaucracies for the processing of paperwork and administration of regulations. To move away from the centralized model will require automated systems for managing such contractual agreements between the different components that are coupling and decoupling from the network, so that they can interoperate in a trusted, secure, legally compliant fashion; a frictionless fashion without dependency upon time-consuming and costly bureaucratic procedures to authorize and validate terms of interaction. Smart contracts provide this exact functionality.
Smart contracts are blockchain-based applications that encode the rules of an agreement or operation. At the heart of every organization is a set of contractual agreements and rules specifying how that organization functions. Instead of having these rules managed and operationalized by people within a centralized bureaucracy, they can be made explicit and encoded within a program that is put onto a blockchain. Once put onto the network they can function as the coordination mechanism for the diverse set of participants within that ecosystem.
Smart contracts feature the same kind of agreements as traditional legal contracts but they remove the need for the trusted third party. This is because a smart contract is both defined by the computer code and executed by the code itself, automatically without discretion. As such blockchains and smart contract technology can remove the reliance on centralized systems and enable people to create their own contractual agreements that can be automatically enforced and executed by code. Smart contracts are decentralized in that they do not exist on a single centralized server; they are distributed and self-executing across a network of nodes. This means that untrusted parties can transact with each other in a much more fluid fashion without depending upon third parties to initiate and maintain the rules of the transaction.
These automated contracts will be key to enabling the next generation health service networks as smart contracts can function as the basic coordination mechanisms within large ecosystems of diverse actors that may not know each other or otherwise trust each other. For years medical record keeping has been held back by the need for compliance, but storing records on a blockchain enable those with permission to securely access and update them while having this automatically comply with rules and regulations. Smart contracts can streamline ownership and access to crucial health care records allowing organizations and applications in the health network to access them automatically given the correct authentication and user privileges.
As an example, we could think of a smart contract for an insurance policy. Once an individual purchases health insurance the details of that contract get specified within a smart contract and linked to their profile on the blockchain, when the person undergoes a medical procedure that is covered by their policy then the smart contract would be automatically triggered to make the payment from the provider to the end-user.
This same automation applied across the many actors, organizations, technologies and software applications within a health system could create a decentralized market for healthcare where modular service components securely registered on a blockchain are readily discoverable; so as to bring together the right resources, knowledge, information, technology etc. at the right time in response to the end user’s needs.