On Health, Humans, and Blockchain

4 min readSep 11, 2018

Our interview with Jose Arrieta, is out (iTunes, Google Play, and Stitcher)! Jose is the Associate Deputy Assistant Secretary for Acquisition at U.S. Department of Health and Human Services (HHS).

“What’s exciting about blockchain is that it doesn’t matter who are you, you are part of how the world shapes technology. It all depends on whether you have the passion, interest and energy to develop the framework that will be adopted by the community.” -Jose Arrieta

What are problems with government as a consumer/deliverer of goods and services in DC? Why use blockchain and what platform did you use?

The U.S federal government spent around $800 billion every year on goods and services through grants. The the Department of Health and Human Services(HHS) is the largest giver of grants: the total budgetary impact is over $1 trillion.

The government has evolved into multiple facets that makes it difficult to track the spending across different agencies and operational divisions. To find out about the spending in each division, the current approach requires us to reach out to each divison to grab spending details.

Rather, we’re using the Hyperledger system to layer over the existing contract writing systems at HHS. We use an automated machine learning algorithm to extract key information from those contracts. Then those data will be distributed in the data layer on the Hyperledger Fabric. Using a proof-of-authority mechanism, we created a standard trustworthy of data that is immutable.

Then we use the orchestration layer of hyper-ledger fabric to build and implement micro-services. For example, we built a P&L tool to give visibility of the spending to the entire organization. That pricing information is accurate and consistent across HHS, which allows buyers to make an informed decision about their purchases at point of checkout. This tool, along with other micro service tools help the government to decide how to cut costs, save operation time and modernize technology.

How did you convince your leadership to jump through the bureaucratic hoops and implement the blockchain proof of concept?

There’s a lot of luck. It depends on the culture that is open to changes. HHS has a strategic initiative to embrace new technologies. I was also able to run a POC during my last position at the General Services Administration (GSA). I came into this job under great conditions. That said, there’s still work that needs to be done.

First, we focused on is not what we will do with the technology, but how we will transform the business model. We decided to empower decision-making on the individual level by giving them access to all data points across the agency. Our goal was to centralize the data but decentralize the decision-making based on that single source of truth.
Second, we map the life-cycle of the human-centered design. We sat down with users and tried to identify their pain points across the process cycle.
Third, we went ahead and built an example using blockchain to show to the workforce how it would improve their workflow.
Lastly, we measured the outcome using financial metrics to document our progress along the way.

How you rate the innovation environment in DC?

Having worked for a regulator, sometimes we overthink the risks of noncompliance, rather than having a conversation and educating regulators of what we are trying to do. If you engage in a converation with regulators and help them understand what you are trying to do, they might more likely to get on board.

DC has a different innovation model, which has been in place for a long time. It does impact the speed to market compared to Silicon Valley. That said, the DC market environment has become increasingly open to innovation.

Tell us about your blockchain class you’ll be teaching at Johns Hopkins University

I really enjoy teaching but I think I learn more when I teach. I have been teaching since I was 30 years ago. An opportunity came up where I get to teach alongside Dr. Jim Liew about blockchain. Our plan is to first go over the basics of blockchain, dispel the myths about this technology, explain the differences between various types of blockchain designs (permissioned vs. permissionless blockchains).

The second part of the class is a perspective on how the market evolves. The goal is to help students understand how some companies tripped up over regulation hurdles and failed.

I am a huge proponent of case-based learning. We’ll challenge students to target a specific industry, and use a specific dataset to implement blockchain solution for that industry.

What’s exciting about blockchain is that it doesn’t matter who are you, you’re part of how the world shapes the technology. It all depends on whether you have the passion and interest to develop the framework that will be adopted by the community.