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How Blockchain Can Improve Data Security in Healthcare

How Blockchain Can Improve Data Security in Healthcare 


Significant advancements in healthcare have emerged in the last decade – from telehealth, to COVID-19 tracking, to online scheduling tools that make accessing healthcare easier than ever.

While these technologies are advancing healthcare access and equality, a major risk is escalating: data breaches and compromised patient data.

Healthcare data breaches are a global concern, with far-reaching consequences that extend well beyond the headlines. Patient information exposure, privacy compromise, identity theft, fraud, lawsuits and millions of lost dollars are just some of the alarming ramifications.

Amidst this growing challenge, the need for more secure, verifiable, and compliant healthcare records becomes increasingly critical, not only for healthcare providers but also for the patients they serve.

Why use blockchain for healthcare data security?

Patient data, medical records, insurance claims and treatment plans must be better secured than they are currently and, fortunately, a solution is emerging in the form of blockchain-powered data storage.

By utilizing blockchain-powered storage, healthcare providers can now significantly enhance the privacy and integrity of medical data, minimizing the risks associated with unauthorized access and breach.

Blockchain architecture uniquely provides three benefits that enable a new level of security for healthcare:

  • Blockchain is decentralized and by distributing data across a decentralized network, healthcare organizations greatly reduce the risk of data loss by removing a single point of failure.
  • Data secured by blockchain is protected by cryptographic algorithms that provide a mathematical certainty that the data cannot be breached.
  • Blockchain accounts for any and all data access, making it tamper-proof.

Blockchain ensures verifiability, traceability, and complete immutability of data records. Data integrity must be a cornerstone of cloud storage and blockchain technology guarantees that.

High costs of a healthcare data breach

The healthcare industry maintained its position as the most expensive sector for cost of data breach for the 13th consecutive year, according to the 2023 Cost of a Data Breach report by IBM.

While the number of attacks has remained steady, the rise in hacker sophistication in the healthcare sector has made breaches harder to prevent and more damaging, compelling organizations to prioritize and rethink cybersecurity efforts.

The IBM report underscores the urgency for the healthcare industry to address cybersecurity comprehensively and proactively as it continues to face evolving threats every year.

This is why the use of blockchain-based data storage is imperative for healthcare. Sensitive medical data, diagnostic images, patient records and all confidential information must be perfectly protected.

Decentralized storage not only enhances security but also contributes to substantial cost savings, as data breaches can be extremely costly due to the inevitable financial and reputational damages.

Decentralized storage can eliminate those costs by preventing data breaches in the first place. Additionally, large healthcare data sets can be stored inexpensively compared to traditional storage, making decentralized storage a cost-effective option to store healthcare data.

Given the sensitivity of healthcare data, it is incumbent on service providers to demonstrate a level of operational excellence through compliance standards such as SOC 2 and HIPAA. SOC2 sets a broad operational control standard, while HIPAA specifically targets the healthcare sector.

These standards are primarily focused on establishing measures to recognize and counter risks related to factors like data availability, privacy, confidentiality and security. Blockchain storage, with its risk mitigation controls, offers healthcare data custodians a reliable solution.

Healthcare data breaches: a wake-up call

Hospital and clinic operator HCA Healthcare, one of the largest healthcare providers in the United States, experienced one of the most significant healthcare data breaches in history this year. Given that it impacted 11 million patients in 19 states, the breach served as a reminder for healthcare providers to reassess their cybersecurity measures.

The breach was attributed to a theft from an external storage location used for email message formatting, exposing sensitive patient information such as names, addresses, contact details and appointment dates. In the wake of this breach, HCA Healthcare dealt with five court cases from affected patients in multiple locations.

Another example comes from a data tampering breach that occurred over seven years. Jelly Bean, a communications firm that hosted a site containing Florida children’s health insurance data, failed to patch website vulnerabilities, exposing more than 500,000 applications and sensitive patient data.

The US Department of Justice has emphasized the need for government contractors to uphold data protection responsibilities, signalling its intent to hold companies and management accountable for cybersecurity breaches.

These incidents underscore the importance of robust data security measures for healthcare providers, urging them to reassess their cybersecurity strategies to safeguard patient data.

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