UnitedHealth Group dabbling with blockchain

UnitedHealth Group is joining forces with a rival health insurer and one of the nation's largest lab testing companies to see if blockchain technology can improve health care data.

On Monday, UnitedHealth is announcing the pilot project in conjunction with Kentucky-based Humana, New Jersey-based Quest Diagnostics and a New York firm called MultiPlan. Financial terms were not disclosed.

The first target is to look at whether the technology can help ensure that the list of doctors and hospitals in a health plan's directory of network providers stays current — an important task so that patients maintain access to their doctors and health plans avoid regulatory scrutiny.

"Industry estimates indicate that $2.1 billion is spent annually across the health care system chasing and maintaining provider data," the companies said in a statement. "The pilot will examine how sharing data across health care organizations on blockchain technology can improve data accuracy, streamline administration and improve access to care."

Blockchain is a technology that started with cryptocurrency Bitcoin in order to create a secure environment for exchanging financial information, said Mike Jacobs, a senior distinguished engineer at UnitedHealth Group's Optum division for health care services.

The technology tends to be open-source software at its origin, Jacobs said, but industries outside the world of digital currencies are now trying to see if nonpublic blockchains could be useful for their enterprises.

One of the technology's distinctive features, Jacobs said, is that it's intended to address business problems for multiple companies that want to share information and streamline processes. That is why the pilot project being announced Monday will first address the accuracy of demographic data in health plan provider directories, which are labor intensive to maintain and include data that's common to competing health plans.

"This is likely one of the very first nationwide health care blockchain alliances," Jacobs said. "Health care in general is just getting started on understanding what the appropriate uses are of this technology."

Quest Diagnostics is involved because the lab company routinely picks up specimens from clinics and bills health plans for running tests. When the lab company and the health plan have different demographic information about those clinics, insurers might reject the claim, Jacobs said.

The denial, in turn, kicks off a costly process for both sides to make sure the bill should be paid.

"It's in a diagnostic laboratory's best interest to ensure that the most up-to-date information is at the insurance company," Jacobs said. "And the best way to do that is to share the best information that they have on hand, and share it with as many of the insurance companies as possible."

The companies will study whether blockchain technology improves the quality of data in health plan provider directories, Jacobs said. They will also look at whether using the technology could let companies avoid some of the current expense with maintaining directories.

Humana is one of UnitedHealth Group's chief rivals in selling Medicare health plans, which is a growing business for both companies.

About 2,400 workers at Quest Diagnostics were scheduled to become Optum employees under a partnership agreement announced in 2016 whereby the UnitedHealth Group division assisted the lab company with issuing and collecting medical bills. Quest Diagnostics, in turn, was scheduled to become Optum's primary vendor for certain screening tests in employer health plans.

Christopher Snowbeck • 612-673-4744

Twitter: @chrissnowbeck