Table of Contents
Table of Contents
Looking back at the rich history of the healthcare industry, we can find a series of technological breakthroughs to improve patient outcomes and improve access to services. One of the most recent disruptions of Blockchain technology in the healthcare sector is the revamping of the insurance sector.
Blockchain is a disturbed ledger system that records transactions and stores data on a ledger that is immutable and transparent. Once the block is filled with data, a new block is created and the data is stored in chronological order.
Here’s a survey of blockchain and its adoption across various industries:
Blockchain technology can be implemented on a private or public network. Here are a few benefits of using Blockchain technology in your business:
Indian healthcare ecosystem
The health insurance sector in India collected health insurance premiums worth INR 516 billion in 2020. The health insurance sector in India consists of several stakeholders such as insurance companies, beneficiaries, providing hospitals, intermediaries, InsureTechs, start-ups, and the government. These stakeholders interact through a complex network of interdependent and paper/data-sensitive workflows.
The network of stakeholders is very complex and consists of intensive workflows of data. Although many stakeholders are utilizing many innovative technologies the process is yet to become seamless. Though technology has helped India’s health insurance system and reduced the workflow burden and the entire ecosystem transformed from manual to digital.
With the help of Blockchain technology, one can enable the seamless exchange of information and improve trust between various stakeholders through a participative approach. A need for traceability and tamper-proof makes it important to set up a network that can be trusted.
Here are a few stats highlighting the future of health insurance in India:
A smart contract is an agreement that is self-enforced as a code and is managed by Blockchain technology. A smart contract is:
Smart contracts in healthcare insurance are a boon for the industry. Traditionally insurance organizations rely on trusted intermediaries to execute the transactions. But with the involvement of a third party, the process becomes slower and expensive taking months to be processed.
The following image depicts the advantages of smart contracts:
With the help of smart contracts, human interference can be reduced. Smart contracts help mitigate the risk of manipulation caused by the mediators and also increase transparency.
Smart contracts are stored on the Blockchain so that both parties can see logged transactions. An additional advantage of using smart contracts is that they speed up claim processing, reducing administrative costs for organizations.
According to a report by PWC, insurance companies lose around 8.5 percent of their revenue to fraud. These frauds occur due to gaps in the insurance industry. Gaps such as:
The total cost of insurance fraud in healthcare insurance in the United States is estimated to be more than $40B a year, according to a report by the FBI. The complexity of the modern insurance industry creates various gaps of invisibility that can be exploited to perpetrate fraud.
This also creates opportunities for criminals to make multiple claims across different insurers for a single loss.
Blockchain enables better communication and coordination between insurers to combat fraud. On the distributed ledger, insurers could record permanent transactions with granular access controls to protect data security.
At the time, no system in the insurance industry helps to track an agent after the fraudulent conduct. No mechanism is available to know the performance and history of the agent and to decide which agent should sell which policy.
The need of the hour is a shared database based on Blockchain technology which is immutable and shared with all the participants.
Blockchain technology can simplify the process by allowing for greater trust between the insurers and the person insured, increasing transparency in the complete process. The claim process can be started immediately with the death of the insured person, helping to lift the pressure off the deceased person’s family.
Digital ledgers such as Blockchain can help the insurance industry to automate its outdated processes and save billions of hours of paperwork each year. Blockchain technology in finance and insurance can also help to increase communication that allows for easy collaboration between patients and doctors. We are well aware of the fact that the insurance ecosystem contains millions of stakeholders. From insurers to healthcare providers to patients, some players are involved in the industry, making it easier to get bogged down by money and time-wasting inefficiency stemming from billions of forms.
Develop your next blockchain in healthcare with Debut Infotech.