Blockchain Technology in Healthcare:

How Decentralisation Can Improve Data Management

Keywords: Blockchain, Healthcare systems, Data management, Interoperability, Data decentralisation

Introduction
A blockchain is a digital structure where data is stored, shared, and secured via blocks. These blocks connected to each other within a network, similar to a list of records organised by date, time, or type. Unlike traditional structures where data is cached in central servers, blockchain technology distributes it across a collection of nodes, hence the notion of decentralisation often associated with it. A key purpose of this design is to give participating nodes the ability to access data at the source without the need for a central management intermediary, allowing for improved storage, distribution, and transparency.

Blockchains see frequent deployment in financial services, where fiscal transactions between actors can be recorded, stored, and referenced at a later date. Yet, the design has the potential to transform industries that are information-intensive, and rely heavily on data to make decisions.

A blockchain operates on a system of cryptographic hashing and consensus mechanims. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data, making it nearly impossible to alter records retroactively without modifying every subsequent block —a feature that enhances security and trust. Unlike centralised databases, where metadata is aggregated into a central repository, and which rely on a single authorotative source for verification, blockchain uses distributed ledger technology (DLT), where every node in the network maintains a copy of the ledger and must reach consensus before any new data is added.

This consensus is typically achieved through mechanisms such as Proof of Work (PoW) or Proof of Stake (PoS), which prevent unauthorized modifications and ensure that only valid transactions are recorded. These qualities make blockchain particularly valuable in environments that demand immutability, transparency, and resistance to tampering (Bell et al., 2018). In this issue, we’re exploring how blockchain could be implemented within the context of healthcare to improve data management systems.

What’s the role of data in healthcare?

In hospitals and healthcare, data informs both clinical and non-clinical decisions. Patient records, treatment plans, and operational data, all contribute to an ecosystem where the timely and secure exchange of information is critical in the delivery of high quality care (Bell et al., 2018). Given this nature, hospitals have stringent requirements for data management, and the use case for blockchain can be better applied if these requirements are understood.

System security

Hospitals handle high volumes of patient information. Strict privacy and data regulations require robust security measures to prevent unauthorised access, data breaches, and tampering. Blockchain enhances security through transparency, immutability, and encryption. These elements ensure data security while allowing for controlled access through consent mechanisms.

Interoperability

Interoperability is a key focus of healthcare systems. This refers to the ability of different systems and stakeholders to share and use information. Healthcare providers rely heavily on centralised databases to record, reference, and share patient data, which can create issues in this area. Blockchain decentralises data storage through authentication mechanisms that promote security and the a standardised mode of data exchange. This improves system connectivity and reduces data silos that result from centralisation.

Data sharing

The delivery of efficient, high quality, care is dependent on the ability to share accurate data in real-time among different stakeholders, such as clinicians and insurance providers. Blockchain facilitates data sharing by providing authentication and assurance while preserving data integrity through immutability.

Mobility

The adoption of tele-health, wearables, and remote patient monitoring systems is increasing rapidly. Modern hospitals require data systems that support patient mobility. Blockchain overcomes existing limitations by enhancing how these systems connect, promoting portability and consensus-driven control.

Improving the exchange of data
Hospitals demand high levels of interoperability. Yet, data fragmentation is major challenge in sustaining them. Patient data is often scattered across multiple providers, servers, and electronic health records (EHRs) (McGhin et al., 2019). Poor interoperability delays patient care, research, and increases costs for stakeholders. Several authors (Bell et al., 2018; McGhin et al., 2019; Dimitrov, 2019; AbdelSalam, 2023; Prashar & Sunder, 2024) note how a lack of interoperability within healthcare stems from data centralisation and contributes to fragmentation, increasing the difficulties in sharing patient and operational data.

Data practices are heavily regulated within the healthcare sector. This protects patient privacy and deters malpractice.
While pivoting away from central databases may seem contrary to strengthening privacy and security, it may demonstrate the opposite effect. Blockchain strengthens these areas by encrypting and distributing medical data across a network of nodes, rather than concentrating data at a single point. In many cases, once data is added to the blockchain, it cannot be modified, and access the system requires a key (Vazirani et al., 2019). This creates a consensus-based, verifiable, and correct ledger of data, making the design well-suited to information systems that rely on data integrity to complete tasks (AbdelSalam, 2023).

The deployment of blockchain could enable complete interoperability in healthcare systems by creating a decentralised database that is fast, accurate, and widely distributed. One author notes how data fragmentation excludes patients from access to their records and limits cohesion among providers (McGhin, 2019). This results from patient data being located in multiple different locations (e.g., hospital, physician practice, specialist clinic) and gaps in linking records to each other (McGhin, 2019).

Healthcare systems frequently employ EHR software to create, update, and share patient data. While EHRs have significantly improved collection and access, limitations in their distribution often result from their reliance on a central database. A patient may be under the care of multiple clinicians at once, with each being able to add or modifying the record at any given time. For every interaction between these two parties, a disruption can occur from new records bring created, changing communicate protocols between providers, and incompatible IT interfaces that delay authentication and data processing (McGhin, 2019).

Because a blockchain is continuous string of events, a single point of truth is created to represent all data (AbdelSalam, 2023).
The decentralised allocation of this data across multiple servers throughout a blockchain may facilitate faster access, improve data quality, and strengthen patient agency (Khezr et al., 2019). This not only gives the patient greater control over how their data is managed, but providers an improved ability to manage their care.

Data pipelines
How would providers actually manage patient data? The implementation of blockchain in healthcare data systems requires a defined pipeline that ensures data integrity, security, and accessibility while complying with privacy regulations. A data pipeline is a structured process that governs how data moves from its initial point of entry to its final destination, ensuring it remains accurate, secure, and usable throughout its lifecycle.

Pipelines facilitate the collection, transformation, storage, and retrieval of data, allowing organisations to maintain consistency and reliability across different systems. A robust data pipeline supports a provider’s ability to securely exchange patient information, track medical records, and verify transactions in real time, all while maintaining regulatory compliance. Below illustrates how a data pipeline could be built on blockchain.

i. Creation of electronic health record

When a patient interacts with a provider, such as a physician, an EHR is generated. This record contains key medical data such as diagnosis, adjustments to treatment plan, prescriptions, and lab or imaging results. The record is securely logged and structured in compliance with healthcare data standards. At this stage, the blockchain timestamps and hashes the data, ensuring it is immutable and traceable.

ii. Formation of authorised user-list

Blockchain promotes patient-centric interoperability (Vazirani et al., 2019). When an EHR is created, only a permissioned list of users may access it. This control list defines who can view, modify, and share the data. Patients, clinicians, insurers, and third parties (such as research institutions) are assigned unique keys granting permanent or temporary access. Smart contracts, a form of transaction protocol on blockchain, may be leveraged to enforce access policies and agreements, safeguarding data from unauthorised users.

iii. Integration of blockchain architecture

The created data is distributed across three layers: the database, the blockchain, and cloud storage. The database may be local or systemwide, and stores EHRs. The blockchain logs all interactions with the database, including access, consent changes, and modifications. Cloud storage is employed to manage large, non-sensitive data such as medical imaging results, with the blockchain providing verification to prevent tampering. This approach may ensure scalability while maintaining security.

iv. Systemwide connectivity is established

The decentralised network is connected to providers across the healthcare system, enabling interoperability and real-time data exchange. The network allows different hospitals, clinics, pharmacies, and insurers, to rapidly and securely share verified patient data. Consensus mechanisms validate events, prevent unauthorised changes, and empower patients by enabling greater control over their data.

Implementation rationale

Blockchain tackles several challenges in healthcare data management, making it a strong candidate for implementation.
As one author highlights, creating a robust IT system is an extensive operation, requiring elements such as backup storage, recovery mechanisms, and constant updates (Dimitrov, 2019). Hospitals balance IT security and regulatory compliance with patient care, which creates complex digital and cultural landscapes (AbdelSalam, 2023). Inaccurate or unavailable data due to system downtime, may harm patient safety, decreases quality, and lose efficiency.

Blockchain-based systems, through their immutable design, would keep data accessible during maintenance and updates.
The integration of consent mechanisms have the potential to significantly improve operational efficiency and reduce costs in this area (Vazirani et al., 2019). Blockchain enhances both security and workflow using an authorised user-list. The ability for providers to verify, share, and updated medical records with reduced administrative overhead may prove transformative in the delivery of high-quality care.

Healthcare is a highly complex and regulated industry, and the successful implementation of blockchain is dependent on stakeholder buy-in. Diffusion of innovations theory may assist us in understanding how humans and systems decide to adopt or reject new technologies. The table below illustrates the five key characteristics that often influence this rationale.

Key characteristic

Relative advantage

Compatibility

Complexity

Trialability

Observability

Definition in context

Potential benefits of blockchain must be weighed against the costs and risks of overhauling existing infrastructures

The effectiveness of blockchain depends on how well it integrates with existing software, compliance frameworks, and hospital workflows

The technical nature of blockchain, combined with the intricate processes already in place could create resistance to adoption

Blockchain requires systemic integration across multiple stakeholders to demonstrate its full potential. Limited opportunities for testing slows down adoption

The benefits of blockchain may not be immediately visible. Without clear case studies or industry-wide success stories, decision-makers may be reluctant to invest

Key characteristics of innovation diffusion theory and their definitions in the context of healthcare (adapted from original, Prashar & Sunder, 2024).
Obstacles

i. Technical challenges

There is a shortage of IT understanding in healthcare. One author notes that many healthcare organisations employ external consultant to navigate digital transformations (AbelSalam, 2023). A lack of in-house expertise slows adoption and increases dependency on third party vendors, contributing to uncertainty in decision making. The range of priorities hospitals must balance such as patient care, meeting operational targets, or regulatory compliance, create friction in the adoption of novel technologies.

The technical complexities of data management systems further compound these challenges. Hospitals function as highly intricate ecosystems with an extensive amount of interlocking elements (Prashar & Sunder, 2024). A blockchain within a hospital would need to be able to process a high volume of data; a high frequency of transactions occurring in real-time; and a high volume of nodes and network load. These factors are primary concerns for providers (Prashar & Sunder, 2024).

Concerns over system compatibility and operational disruptions may also contribute to hesitancy in blockchain adoption.
The transition to blockchain itself presents a challenge, requiring hospitals to integrate new systems without threatening ongoing operations. Despite the potential for blockchain to improve care data management overall, its implementation will first need to overcome the inertia of legacy systems and institutional resistance to change. Understanding the factors that influence the adoption of new technologies in healthcare is essential to crafting strategies that facilitate seamless integration and long-term sustainability.

ii. Stakeholder dynamics

Stakeholder influence embeds the challenge of blockchain adoption in healthcare. At a high level, blockchain serves clinicians, hospital administrators, patients, insurers, policymakers, and researchers (Khezr et al., 2019). These groups each have different incentives, levels of influence, and concerns. Physicians are the dominant clinical stakeholders (Prashar and Sunder, 2024). They may often exercise resistance to managerial oversight, as well a tendency to view technological innovation as a threat to their professional authority. Hospital administrators and policymakers tend to prioritise a mix of efficiency, cost reduction, and institutional productivity (Prashar and Sunder 2024).

New tech often requires buy-in from both clinical and non-clinical levels before being integrated. The latter group oversee institutional goals such as operational efficiency or financial health, making them key decision-makers in approving the use of new systems. The former group determine how tech impacts workflows, patient care, and clinical outcomes. If they perceive a technology as disruptive or misaligned with existing practices, resistance can emerge.

Stakeholder resistance often stems from concerns over cost, training requirements, disruption of established workflows, and uncertainty over long-term benefits (Prashar and Sunder, 2024). For blockchain, additional barriers may include misconceptions about its complexity, the need for significant overhaul of data infrastructure, and uncertainty regarding regulatory compliance (AbdelSalam, 2023). The table below illustrates the factors that both clinical and non-clinical stakeholders influence, and which may impact blockchain’s implementation.

Behavioural resistance from healthcare entities

Reluctance of data sharing among healthcare entities
Data breaches involving patients’ health records
Lack of patients’ trust in data sharing platforms
Resistance to transition from paper to digital records
Conflicting interests among healthcare entities
Fragmented data ownership among healthcare entities

Hospital infrastructure and governance

Complex and fragmented nature of healthcare regulations
Lack of gov-backed blockchain initiatives for healthcare
Conflict between blockchain and health IT privacy regulations
Non-uniformity in digital healthcare standards
Lack of awareness about healthcare data exchange
Lack of integration among healthcare IT systems
Delays in patient care caused by protocol complexity
Risk of innacurate patient information storage
Incompatibility of EHR with legacy health Information systems
Lack of central patient identification database
Security risks posed by individual nodes
Mismanagement of authorised private key by users
Patient data privacy risk during data computations

Lack of technical expertise

Speed and scalability of healthcare data (high-volume, high frequency transactions)
Prevalent clinical malpractices in hospitals
Unfamiliarity of patients with how blockchain works
Lack of patient awareness about health technologies
Lack of awareness of blockchain benefits for data management
Misalignment between hospital needs and blockchain deployment outcomes
Biased samples of patient data

Security risk and resource commitment

High expenditures for hardware, implementation, and support
Timely access to the patients records across multiple healthcare facilities
High computing power requirements
Lack of matuer algorithms for PSN-based blockchains in healthcare
Computation resources and infrastructure requirements
High capital costs including interconnectivity expenses
Increased operational overhead
Proportional increase in network maintenance cost over time
Risk of data manipulations
Inconsistencies in blockchain ledgers due to unreliable internet connectivity
Incaccessibility of healthcare systems to certain groups
Potential risk of compromise of encrypted data
Significant organisational changes and investments

List of challenges facing blockchain implementation in healthcare, influnced by both clinical and non-clinical experts (adapted from original, Prashar & Sunder, 2024).
Overcoming resistance to these influence will likely require a strategic approach that demonstrates how the issue impacts all stakeholders, and how the solution promotes confidence in their respective responsibilities (AbdelSadam, 2023).
The tangible benefits of blockchain must be conveyed alongside assurances that the tech will improve rather than complicate patient care.

A phased implementation may increase trialability, allowing stakeholders to experience the technology before full-scale adoption is greenlight. Aligning blockchain within existing regulatory frameworks could demonstrate its capacity to improve on their requirements, such as transparency, traceability, and data integrity. Successful integration will depend on fostering collaboration among key decision-makers, addressing concerns proactively, and demonstrating blockchain as more than an abstract innovation but as a necessary step toward a more secure and efficient healthcare system.

Conclusion
The purpose of this issue is to explore the potential of blockchain technology to enhance data integrity, security, and accessibility while reducing inefficiencies that currently plague healthcare systems. By decentralizing health records and enabling transparent, tamper-proof transactions, blockchain offers a solution to longstanding challenges such as interoperability, privacy concerns, and administrative overhead.

Through data decentralisation, blockchain technology has the potential to enhance data integrity, security, and accessibility while reducing data management inefficiencies that currently plague healthcare systems, such as inteoperability, privacy concerns, and administrative overhead. While significant challenges face its implementation, there remains a strong argument that blockchain aligns with a core idea of healthcare, being to deliver value to patients — to improve outcomes, enhance experiences, and ensure equitable access to high-quality care. Good data management is essential to achieving these goals, as it underpins every clinical decision and and operational strategy. Without reliable, secure, and efficient systems for handling information, the ability to provide effective care is weakened.

As the industry progresses, perhaps the question is not wether blockchain can work in healthcare, but what it will take to implement. Promoting a narrative that engages stakeholders while highlighting the benefits to patients is necessary to adequately address the technical and social barries head-on. By doing so, stakeholders can actively take part in developing a more efficient and resilient healthcare system—one where data is not a liability, but a powerful tool for improving lives.

References

AbdelSalam, F. M. (2023). Blockchain revolutionizing healthcare industry: A systematic review of blockchain technology benefits and threats. Perspectives in Health Information Management, 20(3).
Bell, L., Buchanan, W. J., Cameron, J., & Lo, O. (2018). Applications of Blockchain Within Healthcare. Blockchain in healthcare today.
Dimitrov, D. V. (2019). Blockchain applications for healthcare data management. Healthcare informatics research, 25(1), 51-56.
Khezr, S., Moniruzzaman, M., Yassine, A., & Benlamri, R. (2019). Blockchain technology in healthcare: A comprehensive review and directions for future research. Applied sciences, 9(9), 1736.
McGhin, T., Choo, K. K. R., Liu, C. Z., & He, D. (2019). Blockchain in healthcare applications: Research challenges and opportunities. Journal of network and computer applications, 135, 62-75.
Prashar, A., & Sunder M, V. (2024). Blockchain barriers in hospitals: a stakeholder theoretic perspective. Benchmarking: An International Journal.

Vazirani, A. A., O'Donoghue, O., Brindley, D., & Meinert, E. (2019). Implementing blockchains for efficient health care: systematic review. Journal of medical Internet research, 21(2), e12439.

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