TLDR: Web3 can take much of the friction out of healthcare as it exists today, including solving the interoperability and data portability challenges within healthcare. But is it hope or hype?
What do you think of when you hear Web3?
For some, it’s the missed opportunity of “investing” in JPEGs that are now worth millions. To others, it’s another momentary trend that’s likely to fizzle out like the many that came before. But what if that wasn’t the case? What if Web3 is more than just trendy digital art? What if it could change the way healthcare is delivered, managed, and paid for?
Web3, as defined by Packy McCormick, the Web3 and Startup Strategist, is, “the internet owned by the builders and users, orchestrated with tokens.”
But what about Web1 and Web2? What happened to them? I will let Chris Dixon provide an overview of the timeline that brought us to Web3.
Let’s dig deeper into how Web3 could impact healthcare.
The Blockchain
To understand Web3, we need to start with the infrastructure, or “internet” layer. For that, we need to get a basic understanding of the blockchain:
The blockchain was born as part of the Bitcoin white paper written by its pseudonymous creator, Satoshi Nakamoto. A blockchain is a decentralized database or ledger of records, that are grouped together in blocks and secured by cryptography.
Each block contains a cryptographic hash, a timestamp, and the transaction data of the previous block. This creates an immutable ledger that cannot be altered. With each block added, the chain becomes more secure. Check out this video to learn more about the blockchain.
What makes a blockchain appealing for healthcare data is its inherent privacy and security. Keeping private health data secure is the highest priority for patients and healthcare providers alike, and the blockchain can do that. With the increased frequency of data breaches, the promise of the blockchain’s privacy is both appealing and needed more than ever.
But how does this all work, practically?
Healthcare in a Web3 World
Let’s use a hypothetical real-world example.
Patient Joe needs to visit his PCP, so he jumps on ZocDoc and schedules a visit to his local Provider.
Being the early adopter that Joe is, he has already downloaded a crypto wallet that he has been using to HODL his Ethereum tokens. That wallet also has the ability to store data and interact with the blockchain.
When he schedules his appointment, he provides his blockchain public key to the Provider. This connects the Provider to Joe’s wallet where he has his PHI for all previous healthcare transactions. Joe decides what he shares with the PCP, if anything.
After the visit, the prescriptions, notes, tests, and other data obtained during Joe’s visit are sent via an API to his wallet. They are then verified on the blockchain as transactions and stored securely.
This process repeats every time Joe visits any Provider and receives care. Joe chooses what to share and with whom. Joe is in control of his healthcare data and he carries it with him in his wallet wherever he goes. The true definitions of interoperability and portability.
So what does this have to do with Web3? Blockchain is the backbone infrastructure that drives much of Web3. It’s the “internet” on which everything else will be built:
It is the internet of Private Healthcare Information, owned by Joe, and only Joe.
That’s the internet part of Web3. But what about tokens?
NFTs
I really admire Jack Butcher’s work. The illustration below is a very clear way to visually describe what an NFT is.
NFTs, or non-fungible tokens, are a non-interchangeable unit of data stored on the blockchain. Think of them as a piece of data, like a certificate of authenticity stored on the blockchain that is verified and complete. They’re unique digital assets, which is where the non-fungible part comes in.
NFTs are still in the early days. Yes, the current rage is digital assets like Cryptopunks selling for millions of dollars, but that’s just the start of potential use cases.
Most of us use health insurance for our medical expenses. That insurance is often provided by our employers, who cover the majority of the cost. We pay our part to be “insured”, including the premiums, coinsurance, copays, and deductibles.
When you get insurance coverage, you are issued a health insurance card. That little white plastic card is our key to unlocking access to a slew of providers, as long as they are in-network, of course.
But what if that card was an NFT that unlocked all sorts of healthcare Web3 glory?
Imagine if instead of that plastic insurance card, you were issued an NFT. A one of a kind digital asset that was specifically for you, the token holder. Recall the finger-print visual above.
That NFT would be listed on the blockchain and would be an immutable record of your insurance coverage. A record stored in your wallet and shared with Providers and other healthcare organizations of your choosing. We can call it your “Proof-of-Coverage.”
Let’s take it one step further.
Healthcare NFTs – Proof-of-Coverage
All health insurance coverage comes with varying levels of coverage and exclusions for things like emergencies, wellness visits, prescriptions, etc. Often we don’t know whether a service will be covered until we get the bill, which can take up several months to arrive.
Web3 can change that.
All of your coverage would live on the blockchain. Your insurance card NFT gets you access to the Providers of your choice, all pre-verified.
Let’s see how this process could practically work.
The patient schedules her visit. She connects her wallet to the Provider’s portal. A query is sent from the Provider to her wallet to verify that she has coverage for the service. She arrives at her appointment. The Provider provides care, and then she is free to go. There is no checkout procedure. There is no bill mailed to her house. No fighting denials or calling for claim status.
When the Patient checked in for the visit, a smart contract was automatically created for the service needed. It included the charge, any out-of-pocket amounts, etc. All automatic, all seamless.
Once the service is rendered, the smart contract is triggered and the appropriate payments made. The patient responsibility portion of the bill was paid by a pre-funded HSA that lives inside your wallet. As simple as that.
Tokens
We’ve covered the blockchain, how NFTs can be used to unlock health coverage, but why would you want to? What’s in it for you?
Let’s talk about tokens.
There are thousands of tokens out there, but one of the most used and adopted is ETH, or Ether, which is the transactional token that facilitates the Ethereum network. Think of it as the gas that drives the network (pun intended).
Tokens are incentives. They attract people to support or use the “network” that you’ve created. See where I’m going with this?
A clear Web3 example of this is Shyro Health.
Shyro Health is a way for individuals – including you and me – to earn tokens in exchange for providing health data. By providing fitness data from your Apple Watch, for example, you will earn a yet-to-be-named token.
So why do this?
- Community: you’re joining a group of like-minded people looking to dive into the world of Web3 and healthcare.
- Rewards – by providing and sharing your data you can earn rewards and discounts. For example, your monthly Peloton fee could be paid for by Shyro in exchange for Peloton connecting to their healthcare data API.
- Token appreciation – Doge to the moon! need I say more?
Another exciting, and still early use case for NFTs in Healthcare is the development and research opportunities.
Let’s say you “mint” your health information on an NFT, it automatically becomes an edition of one. Not just because it’s a rare NFT, which by definition is unique, but because it’s you. There is only one of you and there is only one NFT of your healthcare data.
That extremely rare healthcare data NFT can be used, with your permission, to license to Pharmaceutical companies for their research and development process. They now have access to a trove of actionable data that is unique, personalized, and secure. Think of the potentials for drug development or biotech research. The possibilities are endless.
One of the great features of NFTs is they are easy to monetize. As the holder of an NFT you can set it up so each time your healthcare data is utilized, you receive a royalty. You’ve just effectively created a recurring revenue stream for yourself, of yourself. Now, that’s Meta!
Bringing it home
We started this journey into the intersection of Web3 and healthcare with a definition.
Web3 is “the internet owned by the builders and users, orchestrated with tokens.”
Healthcare is challenging. From the way care is delivered, the patient experience to how it’s reimbursed, it’s all broken in one way or another. Web3 can take much of the friction out of Healthcare as it exists today.
Web3 will help solve the interoperability and data portability challenges within healthcare with the use of wallets. The blockchain can help mitigate data breaches by storing private health information securely. NFTs and DAOs (that’s for another day) will change the way we think about health insurance, provider networks, and other healthcare communities.
Yes, Web3 is buzzy right now, but I’m super excited to see where this all goes.
The future of healthcare is a white space for Web3 to have a long-term impact that goes beyond hype. Is the hope for the industry? We will have to wait and see how it all plays out.