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Physician Credentialing Poses Problems. Can Blockchain Help?


Credentialing and identity verification are critical but troubled processes.

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Delays in physician credentialing and inaccurate information cost the healthcare system millions every year in lost revenue. But, unknown to many, they also affect patients and, in some cases, outcomes.

Just ask Keith Sonnanburg, Ph.D., a clinical psychologist from Seattle, Washington. I recently spoke to him about when he sought treatment for his son and how technical paperwork problems led to delays in care. Here’s what he had to say, edited for style:

My youngest son was stricken by a mystery illness. Bad enough. Then there came a stressful delay in his treatment. I had convinced his specialist that plasmapheresis was one hopeful intervention. Months later, our insurance carrier finally approved the procedure. (There was no “standard of care” for a condition that affects about one in 3 million).

The blood center that performed this procedure required that it be done in a hospital. Once again, things ground to a halt. While attempting to admit my son to the hospital, the doctor discovered he had lost his admitting privileges for failing to admit 10 patients during the preceding year!

A mad scramble ensued. We shopped for a primary care physician (PCP) who had admitting privileges, brokered a deal between the clinic’s administrator and the hospitalist team and had a pediatric hospitalist sign off on the treatment ordered by the PCP, in consultation with the specialist. Whew! This treatment brought about the first lasting improvement in my son’s functioning and lowered his biomarker, which had reached 50 times the normal range.

The Paperwork Problem

Patient care for rare conditions is complex and frustrating. Even routine care has unnecessary delays and, consequently, negative health outcomes. Healthcare finds itself bogged down in regulations and paperwork, with physicians spending very little of their time in actual care.

>> READ: Inadequate Health Records Are Failing Mothers and Providers

Regulatory burden is not only a cost to healthcare systems but, more concerning, an increasing cause of burnout among physicians. Burnout rates vary from state to state, but many U.S. doctors cite electronic health records and a lack of autonomy as a major contributor to the problem.

Even so, training and education means better patient outcomes, and providers have continuing medical education requirements. But logistical problems with their hard-earned credentialing can cause mountains of paperwork and frustration for already-overworked doctors, not to mention delays in care and, in the worst cases, lives lost.

Blockchain, however, is poised to reduce credentialing burden and improve credentialing trust.

Baber Ghuari, M.D., chief medical information officer of St. Mary Medical Center in Pennsylvania and founder of the data-sharing startup Inflo.io, told me about the cost of credentialing: “Currently, it costs between $3,000 and $5,000 and about three months, on average, to credential a physician on a new medical staff. Blockchain technology can completely eliminate the time and expense of this necessary task.” The already-high cost of credentialing does not account for the lost revenue and decline in healthcare service for patients in an area while waiting for credentials to become up to date. Factoring in delays and mishaps, the cost of errors in credentialing is staggering.

In 2016, the average amount of revenue a physician made for a hospital across specialties was $1,560,688, according to a study by Merritt Hawkins. This represents a range where orthopedic surgeons, the top earners, can bring in $2,746,605 in annual revenue. But a delay based in credentialing for an orthopedic surgeon might cost a hospital $686,656.25. The average loss, on the other hand, would be just $390,172 if credentials were instantly verifiable.

When looking for physician credentials, all the different players — hospital administrators, insurance companies and patients — are asking slight variations of the same question: Where did this physician study? What is their certification? Has this physician maintained ongoing education?

In extreme cases, even these questions may arise: Are you really who you say you are? Do you have a license? After all, there was a case of a teen pretending to be a doctor — TWICE. He was able to move between states and even had a Healthgrades page. Stories about impersonation are rare, but repeat offenders are able to pack up and head to another state and start over.

>> READ: Blockchain Enters the Ivory Tower in New Mount Sinai Center

Blockchain is the best technology to track identity verification. Blockchain fuels a decentralized data directory where each part of data is bundled and is easily traced back to a source, so that the verification from a given school for a physician would be visible. A continuously reconciled database structure like blockchain would help improve data quality without the human delay inherent to the volume of information required for physician credentialing and identity verification.

This increased confidence in the identity of a physician will decrease hiring costs for practices and hospitals. On the patient experience side, potential patients would be able to see which physicians are actually actively practicing in their needed area more quickly.

Many argue that the data quality issue of physician directories is a human problem. Not every doctor notifies insurance providers that they retired, for instance. With a distributed shared ledger, information can be updated quickly to get the right information to the right person.

Are You Who You Say You Are? Depends Who’s Asking

Last month, Ramish Tainwala, the CEO of Samsonite, stepped down from his position after apparently padding his resume. The activist investor fund Blue Orca reported falsification of academic credentials, and in a relatively unpublicized decision, Tainwala was forced to resign. However, such false representation isn’t always met with consequences: If a physician has been disciplined for unethical behavior, they could currently move to another state and, in many cases, escape notice. If multiple rounds of investment can occur without adequate due diligence, how does a lack of trust in credentials affect healthcare, an industry in which current credentials and national ethical transparency are vital to saving lives?

Whenever a physician wants to work at a hospital or insurance company, or in any way where the Centers for Medicare & Medicaid or another payer is involved, a credentialing process is mandatory. This means employers are left calling the physician’s medical school, residencies and previous places of employment to verify experience, a process that can take two to three months and can be cumbersome at best. There is no standard form of credentialing across different healthcare systems, and the amount of paperwork is staggering. Confirming a physician identity is downright costly.

In the meantime, patients might not receive important care. While loss of potential revenue through delays captures some of the health system cost, patients who don’t have access to necessary care may experience even more devastating losses. Patients benefit from faster access to great providers. And they can know more about their providers with blockchain-verified results and confirmation of specific education and training.

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