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How Blockchain Will Affect the Medical Billing Industry

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The term blockchain has steadily worked its way into the modern lexicon thanks to the growing popularity of cryptocurrencies. But managing digital money isn’t all that blockchain is capable of, and industries of every shape and size have started to work on ways to implement blockchain into their work. The medical industry is no exception, and there are some intriguing applications of blockchain to the processes of medical billing and coding.

What Is Blockchain?

Blockchain got its start for use in managing bitcoin and other cryptocurrencies, providing a third- party database management system. In terms of those cryptocurrencies, it keeps a record of all transactions in blocks, meaning that the same exchange cannot happen twice. The decentralized system means that no one person is in control of the currency.

No matter the type of data, blockchain can provide similar decentralized records and permanently recorded changes in information. It provides both transparency in transactions and security in the form of not being able to alter transactions after they occur and on private networks. Both of these elements could provide a great benefit for all areas of healthcare, including billing.

Electronic Health Records (EHRs)

EHRs provide digital records of patient’s care and other healthcare information. They also contain information on medical history, previous diagnoses, medications, and other vital facts that can help healthcare professionals make decisions about patient care. A fully realized EHR allows for sharing of this information across numerous health care organizations, giving an even fuller picture of a patient’s medical information than a paper chart can.

While EHR systems have started to show benefits, many are facing issues when it comes to security and accessibility. These concerns lead to a lack of data sharing across different parties, meaning the industry isn’t realizing the full potential of EHRs. A blockchain-based EHR would be able to provide easier access to patient data and reduce data errors and duplications.

Healthcare providers would then simply contribute information to one decentralized EHR, ultimately allowing for a better quality of care and reduced treatment costs. Patients would also control their own data and could allow for access to any necessary parties within their healthcare team.

Billing Management

Healthcare billing faces several challenges. One issue is that the complex levels of medical coding can lead to unintentional billing inaccuracies, such as duplicating processes or incorrect filings. Blockchain can reduce the number of errors by showing proof of when transactions complete, reducing the risk of administering a second billing for the same service.

But an even larger problem than unintentional billing errors is intentional cases of fraud. Patients, providers, and even insurance companies are all capable of conducting billing fraud. Medicare is at a high risk; in 2017, a Medicare task force and the US Department of Justice found 412 individuals, some doctors, guilty of $1.3 billion worth of health fraud. While the current system allows for discovery of fraud, it does not always find all instances and has difficulty uncovering multiple cases at a time.

Blockchain’s complete and decentralized forms of records help with proper payment processing. It also works to show all actions and transactions taken. With all treatments and billing recorded inside blockchain, there is a reliable source of information for claims adjudication. When there are less instances of billing fraud, healthcare costs can stay lower.

Blockchain systems can also serve to optimize the process of billing itself, when combined with computer-assisted coding methods. Automation of the billing process helps keep all accounts up- to-date, working faster than non-automated methods. The reduced level of labor can keep down billing costs, and faster processing allows healthcare providers to reduce delays in collecting payments.


Part of blockchain’s security falls in its permanent recording methods, helping prevent falsified transactions. And while information on a blockchain can be available for public viewing, it is possible to encrypt all data and only allow access by verified users. Blockchain systems allow for a level of security that meets HIPAA compliance standards.

Data breaches within healthcare billing lead to millions of lost dollars for providers. With higher security through blockchain, providers will lose less money, allowing for better distribution of funds.

Insurance Claims

Many patients struggle with their medical insurance claims coming back denied, which can lead to the unfortunate shouldering of bill amounts. This also becomes a struggle for healthcare providers when patients cannot afford to pay their bills in a timely manner. In many cases, denied claims are the result of billing code errors and other similar mistakes.

Blockchain can reduce these denials because it allows for fewer errors. Furthermore, blockchain-run EHRs allow insurance companies to see a verified record of administered treatments, providing an easy way to verify that all billing codes are correct. The result is less denied claims, allowing for better administration of care for all parties.

Further Implementation

Blockchain isn’t a fully realized process in the healthcare billing and coding industry, but it is a compelling enough idea that many healthcare systems are already working to integrate blockchain into their processes. Many others already have. As the technology works its way into the norm, the medical industry will likely start to see more changes that will send ripples through the billing and coding realm as well.

Though the current possibilities seem substantial enough, we also rest at the beginning of blockchain’s implementation. As time goes on and the technology becomes more widespread, the currently proposed uses will see changes and new methods of blockchain use will arise.

There are also the potential to work out with confidentiality, scalability, and governance. As time goes on, new regulations for blockchain use will come into place, allowing for a more unified application of the system. While the exact future and widespread uses are still uncertain, there’s no doubt that this technology will make an impact on medical billing and coding procedures as it works its way into the healthcare industry.




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