A convergence of digital health and decentralization is exactly what the doctor ordered, writes Pradeep Goel, founder and CEO of Solve.Care
Healthcare is clearly going digital, both in terms of access to services and the way in which these services are delivered to patients. The global pandemic has only accelerated this trend over the past 12 months. People have no other choice and quickly get used to the concept of virtual appointments with their family doctor. This is supported by a current one report from Deloitte, which estimates that virtual video visits are expected to account for 5% of all doctor visits worldwide this year. This is in stark contrast to the pre-COVID times of just 1% in 2019. The CDC saw a staggering 154% Increase in telemedicine visits in the last week of March 2020 compared to the same period of the previous year.
But will it take time?
COVID has highlighted the inequalities and inefficiencies in the health system, and as a result we will see an entirely different model of health care after COVID. The world is moving away from a health model driven by centralization and limited by geography to a digital health model where people have access to the best of care regardless of where they live. All of this will have a huge impact on the coordination of services, coordination of care and delivery.
Graphic: Growth in health expenditure by region ((via IHS Markit)
In short, a digital health model will remove a lot of friction from the process, give people more choice and access to care, and improve the way doctors practice medicine. There is no doubt that digital health will not only stay here, but will also play a much more dominant role in caring for one another.
Of course, moving to this digital care model will raise questions about how we measure the quality of care, or how we manage consent, and create challenges around permissions, privacy, and payments. Solving these problems requires technologies that are decentralized, globally accessible, and less tied to an entity-based technology stack. In a simple sense, digital health will also pave the way for health decentralization. A global model of digital health requires decentralized systems where people can join and choose to freely share information while maintaining control over how that information is viewed and shared.
When developing a global digital health model, the main question that arises is how digital value transfer can be included, ie how we can facilitate the use of digital currencies as a payment mechanism. This is an essential consideration because if digital health is to achieve one thing, it will connect doctors and patients from far-flung areas. And of course that means we need to rethink how we pay each other. Given this scenario, we can assume that the payment model, along with a decentralization structure like blockchain, will shift significantly towards digital currencies.
A successful health currency and health care payment system must serve billions of people around the world. Rather than being a mere store of value like Bitcoin, any global health currency must rather become a utility company. Health, like air and water, food and education, is a necessity. Ultimately, this means that we will see a much larger and more organic link between the value of this token and its actual usefulness in the marketplace. With total global healthcare spending expected to hit a staggering $ 8.8 trillion in 2021, the market cap of all tokens that will capture market share will be an order of magnitude higher than the market caps of tokens that are solely for trading or trading Used for trading represent stores of value.
In order for this global health currency to make sense and to be successful, it must meet certain criteria that make it different and more efficient than the currently applicable payment mechanisms. To this end, there are a number of core components that are fundamental to any healthcare-focused digital currency. First, it needs to facilitate delegated payments. Patients need access to a token that can be issued for approved services with an approved group of providers or healthcare providers such as doctors or chiropractors. This token must be transferable not only between the patient and the approved healthcare providers in the network, but also between all patients in the network. This ability to perform peer-to-peer transfers within the network and with third-party healthcare providers is fundamental to ensuring a successful global digital health adoption.
The second essential component of a healthcare digital currency is that it needs to be verifiable. Fortunately, the type of blockchain already lends itself to making transactions easily visible in the general ledger. Qualities that we already see in the blockchain, such as transparency and decentralization, need to be adapted to payments. This leads to targeted blockchains that allow certain parties to provide care and receive payments. These blockchains mainly consist of approved networks connected to digital currencies.
Third, a healthcare-focused digital currency must be able to maintain a stable value at certain points in its existence. It is important that service providers can be sure that they are getting the right value for the service they are providing and that that value will not diminish. It is possible that this requirement will lead to the development of tokens, the value of which fluctuates in the open market, to stabilize at the time of payment. However, this stability is an essential part of any system replacement and must be taken into account.
The next essential factor for the global acceptance of a digital currency in healthcare is easy accessibility. For acquisition, users should not have specific accounts on specific trading platforms or specific tokens for trading on a specific platform, etc. It has to be much, much easier to access than that, and it has to completely bypass the need to learn or participate in certain crypto entry and exit points. This is a problem that needs to be assessed at the application level. How can we make it easier for everyone to access the digital currency market to continuously use their purchase for healthcare payments? This is a question that is more general across the cryptocurrency space.
Last but not least, from a business point of view, it is important that the cost of accepting this currency as a means of payment be a set fee where possible. For example, if you have a scenario where companies don’t know what the cost is to accept payments through this digital currency, they just won’t accept it. Instead, they resort to traditional payment mechanisms like credit cards that are based on fiat currencies and where they already know what the overhead will be. From the point of view of the service provider, the costs of dealing with this currency must become significantly more predictable. Fortunately, companies like Solve.Care and others in the industry are making significant strides towards these goals.
Once all of these issues are resolved, I believe we will see a rapid rollout of a global digital currency for healthcare. There is a real business need for one of us, and those of us in the blockchain and digital currency space are working hard to deliver the solution the market needs.
Change is inevitable. Healthcare is currently experiencing demographic change – the aging population, the globalization of the workforce, the impact of the coronavirus – all of these factors mean that healthcare supply and demand need to be brought back into line. These forces are aimed at making healthcare digital, decentralized, and moving towards a peer-to-peer payment model where control of price, privacy and consent is clearly shifted from business to consumer. Blockchain plays an important role in this shift. More importantly, however, is the role that digital currency will play at the center of the new decentralized healthcare ecosystem.
Chart: Top 10 digital health currencies by market capitalization ((via Cryptoslate.com)
The views and opinions expressed are those of the author and do not necessarily reflect those of Nasdaq, Inc.