Blockchain and the New Economics of Healthcare

37 Pages Posted: 13 Jun 2019

See all articles by Darcy W E Allen

Darcy W E Allen

RMIT University

Chris Berg

RMIT University - School of Economics, Finance and Marketing

Anastasia Pochesneva

RMIT University

Jason Potts

RMIT University

Date Written: May 30, 2019

Abstract

In this paper we outline the economics of healthcare as a problem of coordinating data and examine how blockchain technology might be applied as new economic infrastructure to govern those data rights. We argue that blockchain as a technology of trust pushes the economic organisation of healthcare data away from large, centralised hierarchical organisation towards decentralised, emergent platform organisation. The fundamental problem in healthcare is the coordination and governance of information around decision making (e.g. patient records, licensing of professionals, medical trial data, supply chains). The new economics of healthcare emphasises how this information is governed (e.g. through firms, governments, markets, blockchains) and how the most effective governance changes through time as new technologies of trust are developed. We examine the potential of blockchain as new healthcare data infrastructure (including ensuring the integrity of pharmaceuticals and devices, medical records and data markets). Our view is that blockchain fundamentally shifts healthcare data property rights away from centralised third parties (e.g. hospitals, companies, governments) towards decentralised data property rights held by individual patients. The future platform-based healthcare ecosystem will act as the foundational institutional infrastructure for new competitive solutions to healthcare problems (powered up through other technologies such as the Internet of Things and Artificial Intelligence), helping to solve a growing healthcare productivity crisis.

Keywords: Blockchain, Distributed Ledger Technologies, Healthcare, Health Economics, Electronic Health Records, Institutional Cryptoeconomics

JEL Classification: I1, D8, D23

Suggested Citation

Allen, Darcy and Berg, Chris and Pochesneva, Anastasia and Potts, Jason, Blockchain and the New Economics of Healthcare (May 30, 2019). Available at SSRN: https://ssrn.com/abstract=3396218 or http://dx.doi.org/10.2139/ssrn.3396218

Darcy Allen (Contact Author)

RMIT University ( email )

440 Elizabeth Street
Melbourne, 3000
Australia

Chris Berg

RMIT University - School of Economics, Finance and Marketing ( email )

Level 12, 239 Bourke Street
Melbourne, Victoria 3000
Australia

Anastasia Pochesneva

RMIT University ( email )

124 La Trobe Street
Melbourne, 3000
Australia

Jason Potts

RMIT University ( email )

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