Blockchain in Health Insurance: Sharing Medical Information and Preventing Insurance Fraud

Blockchain technology is mainly analyzed in terms of efficient insurance transactions with real-time transparency and smart contracts. However, little academic research has focused on reducing information asymmetry in the insurance market and preventing insurance fraud using blockchain technology. This study theoretically suggests that the adoption of blockchain technology reduces information asymmetry in the health insurance market by enabling market participants to share medical information effectively and safely. Blockchain technology partially prevents soft insurance fraud by sharing medical information in real time and automatically filing insurance claims. Smart contracts based on blockchain technology prevent insurance fraud by eliminating the opportunity for the insured party to make false claims. In addition, blockchain technology prevents collusion between insured parties and providers because it can limit information manipulation by automatically recording medical information in blocks.