My name is Ali Beheshti, and I’m the owner of Zealie, a leading Revenue Cycle Management company.

In this article, I explain how blockchain can be applied to personal health records. I call this PHIchain, which stands for Protected Health Information. Using a blockchain-based architecture has plenty of advantages: strong encryption means that it’s a hard target for hackers, and its distributed nature means that computer networks can easily store and monitor it.

Of course, blockchain isn’t perfect; larger networks can be slower. Yet these obstacles aren’t impossible to solve. More importantly, medical records today are very fragmented and frustrating (some hospitals still use faxes), so PHIchain promises increased efficiency and cost savings.

I hope this article is a good fit for your publication, and please let me know if you have any feedback or comments.


Ali Beheshti


PHIchain: Blockchain’s medical future

The cryptocurrency revolution promises to transform every aspect of our society, from banking to finance. Yet the greatest value of crypto may not be the incredibly rapid growth of its many different currencies, or even the decentralization of the rigid, highly structured world of finance. Instead, its lasting legacy may well lie in the technology that enables it: blockchain.

Even if cryptocurrencies fade away, there’s a good chance that blockchain will remain. Its versatility lends itself to a huge range of fields, from property rights in emerging economies to healthcare. Indeed, Blockchain has the potential to transform healthcare records–and perhaps even help the sector shed its reputation as the most inefficient industry in America.

The Mechanics of Blockchain (and Bitcoin)

For such a disruptive technology, the premise of blockchain is quite simple. While cryptocurrencies were designed to operate without the oversight of a centralized authority, they still required a method for users to verify balances and transactions. As a result, they settled on radical transparency, opening up all transactions and balances to the public eye.

This is where blockchain comes in. As the name implies, it is a long string (chain) of individual records (blocks) of transactions. Instead of a central bank, blockchain relies on a network of  nodes, or individual computers, which work in tandem with each other. Each node receives a copy of the blockchain, which is constantly updated.

To verify a record and thus approve a transaction, nodes must race against each other to scan and analyze the entire length of the chain of ledgers. Each time a new transaction occurs, a new block (record) is added to the chain. Individual units of cryptocurrency, like a Bitcoin or a Litecoin, are given as rewards (mined) for successfully scanning and verifying transactions.

Why use blockchain in healthcare?

Granted, blockchain isn’t perfect. Currently, many blockchain technologies can be slow and expensive. It’s a problem of scale: bigger networks are slower because they use more nodes. Still, there are some possible solutions, such as sharding, which divides long blockchains into smaller chunks and assigns it to small groups of nodes to analyze.

Even so, blockchain has the potential to solve some of healthcare’s most pressing problems. For one, interoperability in healthcare is a major problem: different EHR systems are simply not compatible with each other. One 2015 survey found that only 29 percent of hospitals could integrate data from outside providers into their system. In practice, this translates to a lot of phone calls, emails, and even faxes, as hospital staff and external practitioners try to communicate with each other in a piecemeal, fragmented manner.

For another, electronic health records (EHRs) are increasingly vulnerable to hackers; unlike sectors such as finance, most healthcare providers haven’t exactly put a premium on cybersecurity. Each year, the healthcare industry loses some $6.2 billion to hackers, with some 90 percent of hospitals reporting a breach in the past two years. On average, each incident cost $560,000 in notification (setting up toll-free numbers and reporting the events to the media and HHS), with an additional $880,000 in lawsuits.

PHIchain: a new model of blockchain in healthcare

PHIchain, or protected health information chain, is one solution. Essentially, this concept would use a blockchain-based technology to balance the need for interoperability and security.

First, instead of burning doctors out with paperwork, blockchain promises a cleaner, more streamlined experience. Rather than having hundreds of providers jostling to find the right record from the right provider (which is what happens at the moment), a network of nodes can scan a patient’s blockchain to retrieve information. Rather than relying on patients to remember specific medications or obscure surgeries from the distant past, providers could check PHIchain for that information instead.

In addition, PHIchain would be a hard target for hackers; even in cases where cryptocurrencies are hacked, they are often stolen from the wallets that store them–not necessarily the blockchain that records the transactions.. While no encryption is perfect, given its fail-safe features, blockchain is more resilient than most.

Any attempt to forge an individual block is extremely difficult. For example, each block builds on the work done from the block before; the evidence comes in the form of a Secure Hash Algorithm (SHA) which links back to the previous block. Any changes to a block would also alter this hash–which would lead to the network rejecting the hacked block.

Another advantage is ownership: patients, not providers, would be in charge of their own PHIchain, which means both more privacy and less mistakes. First, patients would only share their information with who they wish to. Second, with a single resource and record, there is a lot less room for mistakes. Currently, providers often have their own versions of a patient’s record, which aren’t always accurate; they’re also unlikely to be checked, given the incompatibility in different EHR systems.

Further, PHIchain could save money. Overall, the United States spends 8 percent of its total budget on healthcare (compared to 1 to 3 percent in other developed nations). The biggest factor is administrative costs: at an average facility, only about 42 percent of staff are practitioners, while 31 percent are administrators. Across all other industries, the proportion of office workers is about 13 percent.

Future challenges…and opportunities

Still, implementing PHIchain isn’t without obstacles. It’s unclear where PHIchain would be stored. Would it be a physical object, such as a USB drive? On the cloud?

One idea is a to put PHIchain on a microchip, which could then be implanted into your body. While this sounds extremely invasive, microchipping humans has steadily increased over the past few years, and is projected to become mainstream someday soon. Since 2015, 3,000 Swedish citizens have installed a tiny, rice-sized microchip that helps them buy tickets, file taxes, and even serve as keys to their homes and offices.

PHIchain may also have an easier time in some areas than others. For instance, my company Zealie specializes in behavioral health. On the one hand, implementing PHIchain in this field would be easier than general healthcare: there aren’t any large EHR companies which dominate the sector. Further, behavioral health is still a new, growing discipline.

Yet behavioral health, like many other areas of medicine, requires a lot of information sharing. In its current form, passing data along the PHIchain is a challenge, especially if it comes from different sources. A general practitioner might want to alert a psychiatrist about a patient’s allergy to a certain medicine, while a therapist might want to notify another provider about an individual’s mental condition. It’s clear that PHIchain will have to be compatible and widely accessible (a strong argument for putting it on the cloud).

But for behavioral health, any electronic system may be an improvement over the existing status quo. There is no specialized software for this sector, and it is very difficult for providers to do their jobs.

Still, the point is that we have to start somewhere. The status quo benefits no one–not patients and certainly not providers. It’s past time to rethink our relationship with medical records, and PHIchain may well be our best hope.


Ali Beheshti is the founder and CEO of Zealie, the premier Revenue Cycle Management company in the behavioral health space. Ali is passionate about transforming behavioral health by creating an influential business that uses data, automation, AI, and other emerging technologies to bring innovation and efficiency to the sector.

Ali Beheshti, Zealie CEO

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