Wednesday, April 2019
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Blockchain Venture Lets Patients Control–And Profit–From Their Health Data
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Blockchain Venture Lets Patients Control–And Profit–From Their Health Data

Some 37% of Americans can’t afford a $100 medical bill and 64% of patients delay health treatment because they lack the money to pay for it, according to research from CarePayment/ 20|20 Research. As a result, many people are really sick when they finally seek help, contributing to an epidemic of skyrocketing health costs.

At the same time, there’s a multi-billion dollar industry for health data, in which data brokers sell medical information about consumers to researchers, pharmaceutical companies and others—without those patients’ knowledge or consent.

Two years ago, Andrew Hoppin and Christopher Sealey looked at those facts and came up with a pretty ambitious plan for a company: Build an app and a platform using secure blockchain technology that would allow people not only to protect and control their health data, but to make a profit from it, too. “We believe you shouldn’t have to be wealthy to be healthy,” says Sealey, who is president of the New York City-based startup, called CoverUS. “We’re putting the power of data in patients’ hands.”

Today is also the last day of its equity crowdfunding campaign, presented on the Republic platform. While the company recently raised $750,000 in a pre-seed round, the co-founders wanted a way to extend their philosophy to its funding. Investors can invest as little as $100, allowing regular folks to take part in the campaign. ”We felt it was important to democratize the upside for our business,” says Sealey.

More about how the system works: Patients download data from their Electronic Health Records, also adding real-world health information that only they can provide. Then medical professionals pay for that data. For the healthcare industry, it means getting access to much richer, more valuable and in-depth information. And for patients, the system creates a way to get paid for providing that information. According to Sealey, that amount can easily be an estimated $1,500 a year.

To ensure privacy and security, the platform is based on blockchain technology. Often described as a decentralized, virtual ledger, blockchain systems are public, shared databases or records. Any transaction or interaction between two parties is timestamped, verified and then added on the blockchain  as a block containing information about the transaction. One result is that data isn’t owned by one centralized entity. Plus data is secured through cryptography.

In the second quarter of the year, the company plans to launch its first pilot. That will involve tapping a 1.5 million patient community for people suffering from irritable bowel syndrome, a costly chronic disease, and linking members to healthcare market researchers.

Hoppin and Sealey met while teaming up to upgrade the technology for the New York State Senate about ten years ago. Hoppin also started and sold a civic tech company. Sealey, a customer engagement marketing expert,  helped found an economic think tank and has focused on the inefficiencies and inequities of the U.S. health care system.

According to Sealey, startups sometimes shy away from equity crowdfunding campaigns, because they have to be upfront about their numbers and other information they might not want to reveal. But, as far as the co-founders are concerned, transparency is part of their raison d’etre.

There’s also an advantage, which is the feedback they see on the site. Like many crowdfunding organizers, they’ve found that’s pointed to various important questions, everything from, “What happens if there’s a single-payer healthcare?” to “How is my grandmother going to use this?”, plus providing invaluable early market research insights.

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