If you’re a digital health or health tech company handling patient data, you’ve likely heard of HIPAA compliance. But what does it really mean, and why should you care? In a nutshell, HIPAA compliance means adhering to a set of U.S. federal regulations that safeguard protected health information (PHI). It’s about ensuring patient data privacy and security – a critical concern as healthcare goes digital. Failing to comply can lead to hefty fines and damage your reputation, while solid compliance builds trust with users and partners.
This blog post breaks down HIPAA compliance in plain terms, highlights recent updates (from the past couple of years) that digital health companies need to know, and provides a handy checklist to help you achieve and maintain compliance.
HIPAA stands for the Health Insurance Portability and Accountability Act of 1996. It’s a U.S. law that establishes national standards to protect individuals’ medical records and personal health information. Essentially, HIPAA sets rules for who can access or share patient information and how that information must be safeguarded.
HIPAA’s rules mainly apply to “covered entities” – like healthcare providers, hospitals, insurers (health plans), and healthcare clearinghouses – as well as their “business associates.” Business associates are vendors or service providers that handle PHI on behalf of covered entities. This is where many digital health and health app companies come in: if your product or service involves working with patient data from hospitals or clinics, or you provide a software platform to healthcare providers, you are likely a business associate under HIPAA and must follow the same rules for protecting data.
What does HIPAA protect? In simple terms, it protects protected health information (PHI) – which includes any individually identifiable health information (medical records, treatment information, insurance details, etc.) that can be linked to a specific person. HIPAA has several key components, but the most relevant for tech companies are:
The Privacy Rule: Limits uses and disclosures of PHI. It ensures patients’ health information is kept confidential and gives patients rights over their data (like the right to get a copy of their records).
The Security Rule: Requires organisations to implement administrative, physical, and technical safeguards to secure electronic PHI (ePHI). This means things like access controls, encryption, data backup, security policies, and employee training to protect data from breaches.
The Breach Notification Rule: If a breach of PHI occurs, covered entities must notify affected individuals and report it to regulators (and sometimes the media) within specified time frames.
In essence, “HIPAA compliance” means your organization has the proper policies, procedures, and technologies in place to meet the requirements of these rules. It’s not just a one-time task, but an ongoing commitment to handling health data with care.
For any company operating in digital health or health apps, HIPAA compliance is a big deal. Here’s why it matters:
Legal Requirement & Avoiding Penalties: If you fall under HIPAA (as a covered entity or business associate), compliance isn’t optional – it’s the law. Non-compliance can lead to investigations and civil money penalties (fines) from the government. These fines can be steep, reaching into millions of dollars for serious violations. In extreme cases, willful neglect of HIPAA can even lead to criminal charges. No startup or tech giant wants to be on the wrong side of an OCR (Office for Civil Rights) investigation.
Data Breaches Are Costly: The healthcare sector is a prime target for cyberattacks and data breaches. In fact, reports of large health data breaches have skyrocketed – over 167 million individuals had their health information compromised in 2023 alone (a new record). A breach not only risks patient harm and trust, but also triggers breach notifications, potential fines, and costly remediation. Being HIPAA-compliant (e.g. encrypting data, having strong access controls) helps reduce the risk of breaches and can mitigate consequences if one occurs.
Trust and Business Reputation: Patients and healthcare partners trust you with extremely sensitive information – from medical histories to personal identifiers. A strong compliance posture signals that you take data privacy seriously. This trust can be a competitive advantage. On the flip side, a privacy mishap can badly damage your brand, turning away users and healthcare clients. Hospitals and clinics will also typically only partner with vendors who can demonstrate HIPAA compliance (often by signing a Business Associate Agreement and showing security safeguards). If you want to do business in the U.S. healthcare market, proving you can safeguard PHI is often a must.
Interoperability and Data Sharing: As digital health platforms integrate with electronic health records and other systems, HIPAA provides a common framework for data handling. Compliance can actually enable smoother data exchange because all parties know the rules of the road regarding patient info. It helps you navigate questions like “Can we use this patient data for analytics or product improvement?” or “How do we respond if a patient asks for a copy of their data?” by providing clear guidelines.
In short, HIPAA compliance is both a shield and a compass – it protects your company from legal troubles and guides you in treating users’ health information ethically. For digital health companies aiming to improve healthcare through technology, understanding HIPAA is foundational to innovation with responsibility.
Healthcare regulations evolve, and the past couple of years have brought some noteworthy changes and clarifications to HIPAA. Digital health companies should pay attention to these recent updates and trends:
Post-COVID Telehealth Rules: During the COVID-19 public health emergency, HHS announced an enforcement discretion allowing healthcare providers to use non-HIPAA-compliant video chat tools (like FaceTime, Skype) for telehealth without penalty. This was a temporary relaxation to expand virtual care. As of 2023, that grace period has ended. The public health emergency expired and with it the HIPAA waiver for telehealth, effective May 11, 2023 (with a short extension until Aug 9, 2023). Now, providers and the tech platforms enabling telehealth must fully comply with HIPAA rules again. If your company offers telehealth software or services, you need to ensure features like video consults are happening on secure, HIPAA-compliant platforms (e.g. with encryption and business associate agreements in place). In practical terms: using standard Zoom or WhatsApp for telehealth is no longer okay unless it’s part of a HIPAA-compliant service. Make sure any telehealth tools you provide or integrate meet the necessary security standards.
Online Tracking Technologies & Patient Data: In late 2022, HHS’s Office for Civil Rights issued guidance about the use of analytics trackers, cookies, and pixels on health-related websites and apps. The guidance warns that if those tracking tools collect information that can be linked to a user’s health (even an IP address combined with a page showing health content), that data could be considered PHI under HIPAA. In other words, a hospital or health app can’t simply embed Google Analytics or Facebook Pixel on a patient portal or appointment page without safeguards – doing so might transmit PHI to a third party without proper authorization, violating HIPAA. Regulated entities are not permitted to use tracking tech in a way that discloses PHI to vendors without patient consent or a business associate agreement. This has been a wake-up call for digital health firms: review your websites and mobile apps for any tracking codes. You may need to tweak settings, obtain patient consent, or remove certain trackers on pages where health info is involved. (Notably, part of this guidance was challenged in court in 2024, adding some complexity, but the key point remains – be extremely careful with analytics and ad trackers in any context where PHI might be present.)
New Privacy Protections for Reproductive Health Information: In response to evolving concerns after the Dobbs Supreme Court decision (overturning Roe v. Wade), HHS updated the HIPAA Privacy Rule in 2024 to strengthen privacy for reproductive health data. A new final rule (effective June 2024) prohibits HIPAA-covered entities from using or disclosing PHI for the purpose of investigating or prosecuting someone for seeking or providing lawful reproductive health care (including abortion). In short, a hospital or health tech company generally cannot hand over patient information related to reproductive health if it’s going to be used to go after the patient or provider for receiving or delivering legal care. This is a significant change aimed at protecting patient-provider confidentiality in sensitive situations. If your digital health app deals with reproductive health (for example, a fertility or period tracking app that becomes HIPAA-covered by integrating with healthcare providers), be aware of these new limits on disclosures. Ensure your privacy policies and employee training reflect that such data has extra protections – law enforcement or others can’t just subpoena it to pursue charges against patients or doctors in states where certain care is legal.
Cybersecurity Focus and Proposed Security Rule Changes: With cyberattacks on healthcare on the rise, regulators have been pushing for stronger cyber defences under HIPAA. In late 2024, HHS proposed updates to the HIPAA Security Rule to require more explicit, robust cybersecurity measures. While not finalized yet (as of early 2025), these proposed changes signal where things are heading. The rule changes would mandate that organizations have written security policies that are regularly reviewed, tested, and updated (moving security from a one-and-done checklist to a continuous practice). They also aim to align HIPAA with modern cybersecurity frameworks and best practices. What this means for digital health companies: if you’re not already doing so, start conducting periodic security risk assessments, penetration tests, and updates to your safeguards. Regulators want to see ongoing vigilance against threats like ransomware. Even before any new rule is official, demonstrating a strong cybersecurity program (covering encryption, access controls, incident response plans, etc.) is part of good HIPAA compliance – and it will likely become an explicit requirement soon.
Recognised Security Practices “Safe Harbor”: A positive development for those investing in security is a 2021 amendment to HIPAA (through the HITECH Act) that was operationalised in recent years. HHS is now required to consider an entity’s “recognised security practices” when deciding penalties for a breach or violation. In plain language, if your company follows industry-standard security frameworks (think NIST Cybersecurity Framework, ISO 27001, or other recognised practices) for at least 12 months, that fact can count in your favour during investigations. It doesn’t mean you’re immune from fines (it’s not an absolute safe harbor), but regulators may reduce penalties if you had reasonable protections in place. This update is essentially an incentive to adopt robust cybersecurity measures proactively. For digital health startups, it’s a hint: implement best practices and document them. If something does go wrong, being able to show OCR that you were following recognised security standards can lessen the fallout. In 2022, OCR even put out guidance and an RFI (Request for Information) to clarify how organisations can demonstrate these practices. The takeaway: make recognised security frameworks part of your compliance toolkit.
Keep in mind that HIPAA’s core rules haven’t changed – patients’ rights and basic safeguards still apply. These updates are more about adapting HIPAA to new realities (tech, post-pandemic care, evolving threats, and societal changes). As a health tech company, staying aware of such regulatory trends is part of maintaining compliance. Now, let’s turn to how you can put HIPAA principles into action.
Achieving and maintaining HIPAA compliance can seem daunting, but it helps to break it down into concrete steps. Here’s a practical checklist for digital health companies aiming to be HIPAA-compliant:
Confirm Your HIPAA Applicability: First, determine if HIPAA actually applies to your business. Are you handling PHI on behalf of a covered entity (healthcare provider, health plan, etc.)? If you’re building an app that stores or transmits patient data for a clinic, or integrating with EHR systems, the answer is likely “yes” – you’re a business associate and need to comply. If your app deals directly with consumers and doesn’t involve providers/insurers (for example, a direct-to-consumer wellness app), you might not be a HIPAA-regulated entity. However, even then, adopting HIPAA-level protections is good practice if you handle sensitive health info. When in doubt, err on the side of compliance. Clearly identify what data you handle and which regulations apply.
Sign Business Associate Agreements (BAAs): If you are a business associate, you should have a Business Associate Agreement in place with each covered entity you work with before you touch any PHI. Likewise, ensure you have BAAs with any subcontractors or vendors your company uses who will handle PHI (e.g. cloud hosting providers, data analytics firms, etc.). BAAs are legal contracts that bind all parties to protect PHI and follow HIPAA rules. Without them, sharing PHI is a violation in itself. So, review your partnerships and vendor list – get those BAAs executed to create a compliant chain of custody for data.
Appoint Privacy and Security Officers: Designate a person (or team) responsible for HIPAA compliance in your organisation. Typically, companies name a Privacy Officer (overseeing Privacy Rule matters like who can access data or how disclosures are handled) and a Security Officer (overseeing Security Rule implementations for ePHI). In a small startup, it might be one hat worn by an executive or IT lead. This role entails developing policies, conducting risk assessments, and monitoring compliance. It’s crucial to have clear ownership internally – someone who will champion data protection day-to-day.
Conduct a Risk Analysis (and Do It Regularly): The HIPAA Security Rule requires a thorough risk analysis of your ePHI environment. This means you need to identify where all electronic PHI lives (databases, cloud storage, mobile devices, etc.), and evaluate the potential risks and vulnerabilities to that data. For example: Could an unauthorised person access it? Is it encrypted? What threats exist (hackers, lost laptops, insider misuse)? Evaluate the likelihood and impact of each risk. From this, create a risk management plan – outline the security measures you will implement to mitigate those risks. Importantly, this isn’t a one-time task. Schedule risk assessments annually (or whenever you make big changes like launching new features or migrating data). Regular risk analysis is the foundation of HIPAA compliance because it informs all the safeguards you put in place.
Implement the Necessary Safeguards: Based on your risk assessment, put in place the required administrative, physical, and technical safeguards to secure PHI:
Administrative: Develop written policies and procedures addressing HIPAA requirements – e.g., how you handle data access requests, how you respond to a breach, etc. Train your staff on these policies (more on training below). Control employee access to PHI strictly on a “need-to-know” basis (the Privacy Rule’s minimum necessary standard). Have an incident response plan for security incidents. Also, document everything – if audited, you’ll need to show evidence of policies, training, and actions taken.
Technical: Use strong access controls (unique user IDs, strong passwords, two-factor authentication), and encrypt ePHI both in transit (SSL/TLS for data moving over networks) and at rest (encryption for stored data, databases, backups). Ensure your systems have audit logging turned on – record access and changes to PHI so you can detect improper access. Regularly update and patch software to fix security vulnerabilities. If you integrate with third-party services, ensure data is transmitted securely (APIs should be secure and partners HIPAA-compliant). Limit the use of tracking cookies or third-party scripts as noted earlier – and definitely don’t use them on authenticated pages where PHI is displayed without a BAA or consent.
Physical: Even if you’re a cloud-based app, physical security matters for any office or device that might handle PHI. This includes keeping servers in secure facilities, using device management for laptops/phones (so if one is lost you can wipe it), and controlling physical access to workspaces or backups. It can be as simple as locking file cabinets and as high-tech as badge-access data centres, depending on your operations.
Train Your Team: Human error is a leading cause of breaches, so regular training is essential. Make sure every workforce member who might come into contact with PHI (which could be developers, customer support, data analysts – not just clinicians) is trained on your HIPAA policies and the importance of protecting health data. Training should cover basics like not clicking suspicious links (to prevent phishing), how to handle requests for information, confirming identities before sharing data, using strong passwords, and reporting incidents. New hires should get HIPAA training as part of onboarding, and all staff should receive refreshers at least annually. Also, fostering a culture of privacy – where employees know it’s okay to speak up if they spot a potential issue – goes a long way.
Prepare for Breach Response: Despite best efforts, incidents can happen. Be prepared with a breach notification plan. Know the rules: if PHI is compromised, you may need to notify the affected individuals and HHS (and for larger breaches, media outlets) within a set time (generally 60 days from discovery, per the Breach Notification Rule). Your plan should include: how to quickly investigate suspicious activity or a security incident, who will coordinate the response, how to fix the issue, and how to document everything. Practice this with tabletop exercises – it’s like a fire drill for data breaches. Being able to respond swiftly and effectively will limit the damage and show regulators you’re on top of it.
Stay Updated on Regulations: Make someone in your organisation responsible for keeping an eye on HIPAA news and guidance. Subscribe to HHS/OCR update emails or industry newsletters. As we saw above, guidance can evolve (for example, new rules about reproductive health info or OCR clarifications about analytics). Periodically review your compliance program against any changes in law or best practices. This might mean updating policies or retraining staff when new rules come out. HIPAA compliance is not a “set it and forget it” thing – it’s a continuous process. By staying informed, you won’t be caught off guard, and you’ll demonstrate a proactive compliance stance.
Document Everything: Finally, maintain thorough documentation of all your compliance efforts. This includes your risk assessments, policies and procedures, training records, BAAs, breach incident reports, and any remediation actions you take. In the eyes of regulators, if it isn’t documented, it didn’t happen. If you ever face an audit or investigation, having organized records that show you follow HIPAA requirements can significantly help your case. Many companies use compliance management software or at least a secure shared drive to keep all these docs in one place. Good documentation also makes it easier to onboard new compliance team members and continuously improve your program.
This checklist isn’t exhaustive, but it covers the major pillars of HIPAA compliance. Tailor these steps to your organisation’s size and complexity – a two-person health app startup will implement differently than a large telemedicine platform, but the core ideas (assess risk, protect data, train people, have agreements, and so on) apply to all.
HIPAA compliance might sound like a lot of work, but it boils down to building privacy and security into your company’s DNA. For digital health and health tech companies, treating user data with care isn’t just about avoiding fines – it’s about respecting the people behind the data and building products worthy of their trust. The regulations and recent updates we discussed provide a framework to do exactly that.
Remember that compliance is a journey, not a destination. Regulations will continue to evolve, especially as technology and healthcare intersect in new ways. Today it’s questions about telehealth and tracking pixels; tomorrow it might be rules around AI diagnostics or health data interoperability. By establishing a strong compliance program now – and keeping an eye on changes – you’ll be equipped to adapt and thrive in the health tech space.
By following the guidelines above and staying informed on new developments, you can answer that question with confidence. Protecting patient data is not just a legal checkbox but a fundamental part of delivering innovative digital health solutions that people can trust.
Looking for guidance on HIPAA compliance? Schedule a call with our Founder for expert advice tailored to your needs.