Blockchain-Powered Fraud Prevention in Health Insurance Industry

Abstract

Annually, deceptive claims cause significant financial losses for the antiquated system now in use for processing health insurance claims. Furthermore, it runs serious security and privacy concerns due to its dependence on traditional techniques. Health insurance claims involving prescription drugs are especially susceptible to fraud. Furthermore, a lack of linkage between pharmacy and medical provider prescription data exacerbates misunderstanding and makes it easier to utilize fake prescriptions. This study suggests a way to handle claims related to health insurance that guarantees decentralized management, privacy, security, and reliability by using blockchain technology. The proposed solution makes use of a private Ethereum blockchain and includes two smart contracts that improve traceability and reliability: those for registration and approval. Authorized parties have improved access to centralized patient information through integration with decentralized apps (DApps) and off-chain storage (IPFS). A gateway filters the data that participants may access in order to protect participant privacy. To clarify the guiding principles of the suggested blockchain-based health insurance claim processing procedure for prescription pharmaceuticals, we offer a summary of the system architecture, sequence diagrams, entity-relationship diagram, and algorithms. Security evaluation and contrast with current solutions are used to assess the performance of the suggested solution.