Evaluating blockchain and distributed ledger use for the NHS

Evaluating blockchain and distributed ledger use for the NHS
© iStock-LeoWolfert

Dr Stewart Southey weighs the potential benefits of blockchain and distributed ledger technology in the NHS

The past few years have seen a veritable frenzy wherever the term blockchain has been used. Touted as the silver bullet that will save every industry, billions of euros of venture capital and crowdfunded money has been poured into new projects. Though there are many exciting new start-ups promising to revolutionise healthcare, there are significant challenges ahead before we will know exactly how helpful a distributed ledger can be. This article explores these issues in the context of the UK’s National Health Service (NHS).

An overview of the National Health Service

It’s a bit of a misnomer to think of the NHS as a national organisation. Though funded centrally (almost exclusively through tax contributions), co-ordination of healthcare is performed by a myriad of semi-autonomous and partially competing entities.

One of the largest employers in the world, the NHS treats 1.4 million patients every 24 hours. 207 clinical commissioning groups (CCGs) help channel funds to more than 7,400 GP practices, 135 acute non-specialist trusts and other organisations in England alone. There are 853 for-profit and not-for-profit independent sector organisations providing care to patients from 7,331 locations.1 It is therefore fair to say that the flow of money and data is at best complicated but more likely indecipherable for any single individual.

An attempt to centralise IT services (Connecting for Health, National Programme for IT) famously failed after overspending by an estimated 440-770%.2 There have been many reasons proposed for this failure which are not relevant to the scope of this article. The take home message is clear, however. Centralised projects of this scale cannot work without complete autocracy.

In spite of this colossal flop, the need for integrated care records, prescribing systems and performance management solutions persists. Poor communication and data integrity concerns account for a significant percentage of medical errors and deaths annually. Privacy and accessibility of medical information continue to be of great concern for many patients and clinicians. Financial transparency is almost impossible, and the perceived extent of wasteful practices is frequently in the headlines.

It would be unfair to paint such a dismal picture of the NHS without balancing it with some positive truths. In comparison with the healthcare systems of ten other countries (Australia, Canada, France, Germany, Netherlands, New Zealand, Norway, Sweden, Switzerland and USA) the NHS was found to be the most impressive overall by the Commonwealth Fund in 2017. This achievement was in spite of the fact that health expenditure in the UK was 9.75% of GDP in 2016 where others have significantly higher percentages and expenditure per capita.

Clinical outcomes were unfortunately not quite as stellar, though measuring quality in healthcare is a complex business.

The ‘quadruple aim’ of healthcare3 is to improve the patient experience, improve the health of the population, reduce per capita costs and reduce staff burnout. The addition of the latter aim is important. Whilst there are many proposed reasons for this worrying trend, one widely held view is that the administrative burden placed on doctors is partly to blame:
“It is no coincidence that the spike in burnout rates has come at the same time as the broad adoption of [electronic health records (EHRs)]. Someday, EHRs may revolutionise healthcare by dramatically increasing our ability to share and review patient information. But today, EHRs are turning many physicians into clerks.”4

Improvements to the quadruple bottom line require multiple approaches. Managing the supply-demand relationship of healthcare is complex, as is balancing the conflict of quality and choice versus cost and efficiency. One thing remains true though – decisions should not be based on flawed data. We can only fix what we can identify.

The case for blockchains

No single technology will transform any healthcare system, and it would be naïve to believe blockchain is the exception. Even combined with AI, big data analytics and the other newly spawned hopefuls, distributed ledgers are not entirely capable of addressing the political and economic nuances that influence how care is delivered.

That all said, there is something rather unique about what is being promised. It is not so much the technology per se, as it is the fundamental philosophy underlying it that is so intriguing.

When Bitcoin was launched in 2009, individuals were for the first time able to send electronic cash peer-to-peer across the planet without any central authority permission. This censorship-free value exchange, secured through algorithmic consensus mechanisms and crypto-economic incentives, made dishonest activity economically unviable.

The network effect means that the more participants there are sharing a common trust-brokering infrastructure, the more valuable the platform becomes.

Translating this to healthcare is a bit of a leap of faith, and the technology is nascent to say the least. But, knowing that we can create a virtually unbreakable transaction log and a common communications channel that permits value exchange without third party intermediation is certainly exciting.

Every time the blockchain is added to, the new ‘state of being’ is replicated across the network. All participants can trust the ledger’s integrity and the data is permanently recorded, fully auditable and unalterable.

Whilst this does not guarantee the quality of the data input, it is transparent and there is clear accountability through public key cryptographic signatures. Leaving the importance of oracles and how to ensure the veracity of inputs for another time, it appears that employing distributed ledger technologies may narrow the trust and communication gaps in healthcare significantly.

The NHS evidence base

As we have seen, the NHS is a monolithic tangle of disparate entities – some privately run, others public, but most existing in isolation of one another. Communication cracks between these parties contribute significantly to the inefficiencies observed.

The 2017/2018 NHS England Annual Report5 identifies ten areas of focus for improvement:

  1. Freeing up hospital bed capacity
  2. Improving staff productivity, including further action on temporary labour costs
  3. Leveraging the NHS’s procurement opportunities
  4. Securing best value from medicines and pharmacy
  5. Reducing avoidable demand and meeting demand more appropriately
  6. Reducing unwarranted variation in clinical quality and efficiency
  7. Action on estates, infrastructure, capital and clinical support services
  8. Cutting the cost of corporate services and administration
  9. Improving cost recovery from non-UK residents
  10. Ensuring financial accountability and discipline in all NHS organisations

Closer examination of these areas might provide the basis for testing distributed ledger technology use cases for those aspiring to act.

In addition to this, Lord Holmes published a report in 2017 which examined the potential benefits of distributed ledger technology for improving healthcare in the UK.6 Some of the findings include opportunities lost because of data duplication and fragmentation. Access to medical records, pharmaceutical supply chain integrity, and patient and employee identification mechanisms were also found to be lacking.

Significantly, the report suggests that the use of distributed ledger technology may improve health data and the lives of patients if deployed in these areas.

It’s not a straight line connecting the goals of improvement with the opportunities promised by blockchain. But with self-verifiable data integrity, an accountable log and near real-time state replication at the core, distributed ledger technology might just make agile and informed decisions a realisable reality.

There is of course the issue of interoperability and the fact that blockchains aren’t good for data storage. Nobody believes that legacy systems will be replaced overnight. Yet if trusted, traceable access to these systems can be granted whereby operational decisions can be made, the efficiency could improve dramatically.

The road ahead

Clearly there is much work to be done. Proof-of-concept (PoC) trials with the quadruple aims in mind will need to be conducted before benefits can be claimed. Which blockchain type (public, permissioned or consortium), whether or not a cryptocurrency is required in a semi-trusted environment and the need to comply with regulations (GDPR and many more) all influence the choices ahead.

The burning questions that remain, however, are these:

  • Who will fund these trials and how do we get potentially conflicting stakeholders to engage in a sharing economy?
  • Far more challenging than the technological barriers are the political and economic paradigms that need to be questioned. How can we convince individual hospitals with constrained budgets to build a shared infrastructure with a private provider, a local pharmacy group and the surrounding GP practices?
  • Can co-opetition models work where competing private sector incumbents battle for contracts with the public purse?
  • Who (not what!) will block the path to data sharing, and how can this be mitigated?

Future outlook of distributed ledgers

Reorganising the NHS for 66.57 million people is a gargantuan task. But we should not be dissuaded – the appetite for change and improvement is high. The overall benefits to patients and doctors may far outweigh the costs. In fact, the potential revenue for the UK economy may be significant.

Imagine these scenarios:

  1. Several major UK pharmaceutical companies collaborate with research institutes, CCGs and the major teaching hospitals across the UK. Each is a shareholder in the new joint venture, the purpose of which is to mine national level health data for insights into cancer treatment. Any intellectual property derived is shared, as are the financial returns from new product development. All parties win, patient health improves, and the NHS has additional revenue for reinvestment
  2. All NHS hospitals share doctor credential data with each other (permissions granted by the doctor of course). The Disclosure and Barring Service, General Medical Council, royal colleges and universities also share in these common communications channels. Now a doctor can move freely within the system nationwide if his/her CV matches requirements for work. It doesn’t take months of compliance checks or the costs associated with duplicating those tasks. Matching of supply and demand reduces the need for expensive agency intermediaries. The savings are used to improve doctor pay and improve patient care
  3. NHS trusts join forces with procurement bodies, the supply chain stakeholders (including equipment companies) and the CCGs. Real-time enterprise resource planning with full track and trace facilities creates a responsive and efficient ecosystem. Savings once again are shared, with patients and listed companies sharing in the spoils.

Whilst this all sounds dreamy, unrealistic and perhaps threatening to some, it represents a paradigm shift in business models where profit and the sharing economy can coexist.

Data silos emerge when information sharing costs the company money. Data collaboration on the other hand brings economies of scale and scope, a shared cost base and a percentage share of a potentially much bigger prize.

Naturally, there are no guarantees. But perhaps, with all the other emerging technologies and the combined resources of the public and private sectors, there may well be an opportunity to achieve that quadruple aim.

And if the PoC trials demonstrate positive returns, the burning question will then be: who will block the path or make it happen?

About the author

Dr Stewart Southey MBBCh FRCA MBA MSc (Digital Currencies, in progress) is a senior NHS consultant, healthcare strategist, founder of Catena Consulting and chief medical officer at Biohax International. He is passionate about any medtech and healthcare innovation that promises to improve the delivery of care.


  1. http://www.nhsconfed.org/resources/key-statistics-on-the-nhs
  2. https://www.telegraph.co.uk/news/uknews/1473927/Bill-for-hi-tech-NHS-soars-to20-billion.html
  3. https://qualitysafety.bmj.com/content/24/10/608
  4. https://labblog.uofmhealth.org/industry-dx/opinion-its-time-to-treat-physicianburnouts-root-causes
  5. https://www.england.nhs.uk/wp-content/uploads/2018/07/Annual-Report-Full-201718.pdf
  6. http://chrisholmes.co.uk/wp-content/uploads/2017/11/Distributed-Ledger-Technologies-for-Public-Good_leadership-collaboration-and-innovation.pdf

Dr Stewart Southey
Catena Consulting
Tweet @docsouthey

This article will appear in issue 8 of Health Europa Quarterly, which will be published in February 2019.  

Subscribe to our newsletter



Please enter your comment!
Please enter your name here