The benefits of HIPAA compliance

April 8th, 2024


According to the Department of Health and Human Services Office for Civil Rights (OCR), there has been a considerable upward trend in healthcare data breaches since the office began tracking data breach statistics in 2009. Now more than ever, protecting patient data is paramount—and the Health Insurance Portability and Accountability Act (HIPAA) is key to providing patients with security and privacy. 

HIPAA is a federal law passed in 1996 designed to protect patient health data. Covered entities, including healthcare providers, health insurance companies, healthcare clearinghouses, and any business associates of a covered entity that use or disclose protected health information (PHI), are required by law to comply with HIPAA.

Breakdown of HIPAA

There are three key parts of HIPAA—the Privacy Rule, the Security Rule, and the Breach Notification Rule.

The HIPAA Privacy Rule ensures that PHI is protected throughout the flow of data by addressing when and how individual health information can be used or disclosed. During the process of providing and receiving quality healthcare, health data has to flow from one entity or individual to another. If you’ve been to the doctor recently, you can probably visualize this flow. The nurse tells the doctor about why you came in today, the doctor visits you and perhaps gives you a diagnosis and prescription, your doctor’s office sends your prescription information to a pharmacy, and your health insurance gets a summary of your visit in order to provide coverage. And with patient portals and apps, all of that data can be uploaded and available to you electronically, too. 

The HIPAA Security Rule requires all covered entities to ensure the security, confidentiality, integrity, and availability of electronic PHI; to detect and protect against security threats, impermissible uses, and disclosures; and to certify compliance within their workforce.

Lastly, the HIPAA Breach Notification Rule requires covered entities and their business associates to provide notification when PHI is compromised as a result of a breach. 

Benefits of HIPAA compliance

Compliance with HIPAA is often more than just a legal requirement for organizations—it’s a way to protect patient data, ensure the integrity of healthcare systems, and communicate to patients, partners, and stakeholders that the organization takes security seriously. 

Let’s take a closer look at some key benefits of HIPAA compliance: 

Avoid penalties

HIPAA is more than just a compliance framework—it’s a federal law. Non-compliance with HIPAA regulations can lead to severe penalties. Organizations that fail to protect PHI may face hefty fines, reputational damage, and even criminal charges. By complying with HIPAA standards, organizations can ensure they operate legally and mitigate the potential risks of legal penalties. 

Build trust with patients and customers

When companies adhere to HIPAA regulations, patients feel more secure in sharing their sensitive information. HIPAA was enacted in order to protect patient privacy, but it goes beyond just patient trust—complying with HIPAA can also build trust with partners and important stakeholders. This trust is foundational for both patient relationships and key business strategies.

Mitigate risk

HIPAA requires organizations to implement robust security measures to safeguard electronic PHI (ePHI). This includes encryption, access controls, regular audits, and comprehensive risk assessments. Some specific policies that should be put in place to prevent the unauthorized disclosure of PHI and ensure patient data is protected include those that establish procedures for safeguarding access to PHI, responding to HIPAA violations when they occur, and implementing HIPAA training for everyone who has access to PHI as part of their day-to-day roles. By following these processes, organizations strengthen their compliance postures, reduce the likelihood of data breaches, and mitigate potential threats to PHI. 

Streamline operations

To comply with HIPAA, organizations are required to adopt streamlined processes and standardized procedures for managing PHI. This not only enhances security and privacy, but also can improve overall operational efficiency within organizations. 

Use security as a differentiator

Lastly, organizations should use security as a differentiator to enhance their reputation and give them a competitive edge. HIPAA compliance can demonstrate that your organization takes security, privacy, and compliance seriously, differentiating your business. A key step to proactively build trust with stakeholders is to undergo a security or privacy audit performed by an independent third party like BARR Advisory, which can be made easier with a compliance automation solution like Delve. These measures provide stakeholders with valuable information about the controls that are in place at an organization and any gaps that may increase the risk of unauthorized users gaining access to sensitive information.


Given the state of healthcare-related data breaches, HIPAA compliance is no longer merely a regulatory requirement—it’s a fundamental business practice. HIPAA should be used as a foundation, and organizations should build upon with security assessments like ISO 27001, SOC 2, or HITRUST.  By safeguarding patient privacy, mitigating risk, and streamlining business operations, organizations that comply with HIPAA can strengthen the foundation of security and privacy in the healthcare industry and beyond.

Steve Ryan
Head of Healthcare Services, BARR Advisory

Steve Ryan, head of healthcare services and attest manager at BARR Advisory, is responsible for planning and executing information technology audits and risk assessments for clients in the healthcare industry. He is experienced in various compliance areas including the Health Insurance Portability and Accountability Act (HIPAA), the HITECH ACT, and HITRUST, Meaningful Use risk assessments, NIST SP 800-53, ISO 27001, PCI, SOC 1 and 2 Reports, and other state privacy laws. Prior to joining BARR, Steve was a Senior Consultant in Wolf & Company’s IT Assurance practice. He holds a Bachelor of Science in information systems from Bentley University.

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