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Making Your Next Healthcare Startup HIPAA-Compliant – Essential Considerations

Anastasia Golovko
Anastasia Golovko
June 29, 2023

Despite hacking and IT incidents being the main reasons for healthcare data breaches in 2022, unauthorized access still accounts for 38% of issues. The Health Insurance Portability and Accountability Act (HIPAA) addresses the ways healthcare startups should protect user data and prevent unauthorized access to sensitive information with the help of audit controls and transmission security.

Still, HIPAA regulations are complex and sometimes challenging to comply with, so in this article, we will discuss essential considerations for making your next healthcare startup HIPAA-compliant, including technical requirements, policies and procedures, and employee training.

Understanding HIPAA Regulations for Healthcare Startups

Before we proceed with HIPAA compliance for startups, let’s briefly recap the essence and the goal of this document. The Health Insurance Portability and Accountability Act is a United States federal law that sets standards for protecting sensitive patient health information. Understanding HIPAA compliance startup regulations is vital for healthcare companies. Failure to comply with them may result in a fine from $100 to $50,00 per violation, civil lawsuits and criminal charges, loss of trust from patients, and damage to reputation.

So, before you proceed with creating an eHealth startup, make sure you know the next HIPAA compliance regulations for healthcare software development:

  • The HIPAA Privacy Rule. This rule sets standards for protecting the privacy of individuals’ health information, including how it can be used and disclosed. For example, healthcare software should have access controls to ensure that only authorized individuals can access protected health information (PHI). 
  • The HIPAA Security Rule. As the name of the rule suggests, it outlines data security practices regarding confidentiality, integrity, and availability of PHI. For instance, electronic protected health information (ePHI) that is transferred over an electronic network must be encrypted. 
  • The HIPAA Breach Notification Rule. Logically, this rule obliges healthcare providers to notify affected individuals in the case of their data breach. 
  • The HIPAA Omnibus Rule. The Omnibus Rule requires business associates to comply with the Security Rule’s technical safeguards, such as access controls, encryption, and integrity controls. For example, business associates must implement access controls to ensure that only authorized individuals can access ePHI. 
  • The HITECH Act. The goal of this act is to strengthen HIPAA regulations, such as increasing penalties for noncompliance and requiring breach notifications for smaller breaches.

How to Comply with HIPAA in a Healthcare Startup

Now, let’s find out how to comply with HIPAA regulations for a healthcare startup.

Identify Protected Health Information (PHI)

Since HIPAA stands for protecting PHI, identifying protected health information will be the first step toward ensuring compliance with this act. PHI is any information that can be used to identify an individual and relates to their health status, healthcare services, or payment for healthcare services. Examples of PHI include:

  • Patient names, addresses, and other identifying information
  • Medical diagnosis and treatment information
  • Medical test results and laboratory reports
  • Prescription and medication information
  • Health insurance information
  • Billing and payment information

To identify PHI, startups should conduct a thorough assessment of their data and information systems. This includes reviewing all data sources, such as electronic health records (EHRs), billing systems, and other software solutions, to determine what information is being collected, stored, and transmitted.

Conduct Risk Assessment

Conducting a risk assessment is the next step in making your healthcare startup HIPAA-compliant. This is a process of identifying and evaluating potential risks to PHI security. Some of the possible risks you have to keep in mind include:

  • Unauthorized access to PHI by employees or third-party vendors
  • Theft or loss of mobile devices or laptops containing PHI
  • Cyberattacks, such as ransomware or phishing scams
  • Natural disasters, such as floods or fires, that could damage physical records or electronic systems
  • Human error, such as sending PHI to the wrong recipient.

To conduct a risk assessment, you should evaluate the likelihood of the risky event possible, being guided by common sense, experience, and the current environment. For example, human error is the highest risk to data security, according to a recent report, while the likelihood of natural disasters is significantly lower which nevertheless depends on climate and location.

Hire a HIPAA Consultant

Opting for HIPAA compliance consulting before and during healthcare startup development will also be a wise decision since this specialist can provide guidance and support throughout the development process, from the initial planning stages to ongoing compliance monitoring. 

They will help with ensuring that all software solutions and data systems are designed and implemented in compliance with HIPAA regulations. In this way, you will be able to lay a solid foundation for building trust with patients and partners, avoid costly penalties and legal action, and position your business for long-term success in the healthcare industry.

Implement Administrative and Physical Safeguards to Protect PHI

Administrative and physical safeguards are the set of practices, policies, and procedures aimed at implementing and maintaining security measures to protect electronic PHI. For example, administrative safeguards include information access management and workforce training, while physical safeguards are facility access control, workplace and device security, data backup, and recovery measures. 

In addition to the technical side of the issue, like using physical locks or ensuring the privacy of the screens, there is also a need to pay the highest attention to employee training. When developing the corresponding training, make sure to teach employees how to handle PHI, report security incidents, and respond to emergencies.

Hire a Reliable Software Developer to Comply with the Technical Requirements of HIPAA

In addition to physical and administrative safeguards, there are also essential technical requirements you should follow when developing healthcare software. Some of those established by HIPAA include:

  • Access controls: Implementing role-based access controls, two-factor authentication, and strong passwords to limit access to PHI to only authorized individuals.
  • Encryption: Implementing encryption for PHI stored on devices, in transit, and at rest. This includes using SSL/TLS protocols for web traffic and encrypting data at rest using AES-256 encryption.
  • Audit logging: Implementing audit logging to track all access and activity related to PHI. This includes logging user activity, system events, and access to PHI.

These are just some of the regulations required by HIPAA. What’s more, you have to keep them in mind even before the process of your healthcare startup development begins, and hiring a HIPAA-aware software development vendor would be the right strategy in this case. A reliable and experienced tech company will help you leverage programming languages and frameworks that have built-in security features and are less susceptible to vulnerabilities. 

They will also pay the greatest attention to implementing secure coding practices and security testing, which are crucial for protecting PHI and avoiding costly penalties for HIPAA non-compliance. We, at Tino Agency, would be glad to help you ensure that your future solution meets all the necessary requirements and prioritizes patient data safety.

Develop and Implement an Incident Response Plan

An incident plan is a strategy that outlines how to detect, respond, and recover from a security incident. First thing first, you should identify possible security incidents (which are part of the risks you have identified at the first step), and assemble an incident response team. 

Next, you should develop incident response procedures, highlighting steps for containing the incident, assessing the impact, and notifying the appropriate parties. After testing the plan with the help of simulations, you should make sure that responsible employees are well aware of the necessary sequences of actions.

Develop and Implement a Contingency Plan

Unlike an incident response plan, a contingency plan is a strategy aimed at dealing with an unexpected event, like a natural disaster. In such a case, the PHI availability will be impacted, so first, you should identify the systems and assets that are critical to the operation of the healthcare startup and the protection of PHI, like Electronic Health Records (EHR), and servers. 

Next, it is necessary to develop recovery strategies, for example, providing for alternative processing sites, and emergency communication procedures. This plan, like the previous one, should also be tested, while employees should have a clear understanding of their roles and responsibilities in the event of a disruption.

Perform Ongoing Monitoring and Assessment

The last involves continuously monitoring and assessing the effectiveness of the startup’s policies, procedures, and security controls to ensure ongoing compliance with HIPAA regulations. With this goal in mind, you should conduct regular risk re-assessments, monitor security incidents and learn from mistakes, update policies and procedures, plus conduct regular re-training of employees. Keeping pace with the industry’s regulations and their updates is also a must.

HIPAA Compliance Checklist for Software Development

So, here is a HIPAA compliance software checklist that you can use to ensure you are taking all necessary steps to protect the confidentiality, integrity, and availability of PHI.

  1. Identify the types of Protected Health Information (PHI) that will be stored, processed, or transmitted through your software.
  2. Conduct a comprehensive risk assessment to identify potential security risks and vulnerabilities.
  3. Implement administrative, physical, and technical safeguards to protect PHI.
  4. Develop and implement policies and procedures to ensure HIPAA compliance.
  5. Train all employees on HIPAA compliance policies and procedures.
  6. Implement access controls to ensure that only authorized personnel can access PHI.
  7. Develop and implement an incident response plan to address potential security incidents or breaches.
  8. Implement audit controls to monitor access to PHI and detect potential security breaches.
  9. Develop and implement a contingency plan to ensure that PHI is accessible during emergencies or system failures.
  10. Regularly review and update HIPAA compliance policies and procedures to ensure that they remain up-to-date with regulatory changes and industry best practices.


Startup HIPAA compliance regulations are complex and sometimes challenging to stay in line with. However, ignoring them will result in significant legal and financial penalties, as well as damage to a company’s reputation

At Tino Design Agency, we understand the importance of HIPAA compliance and have the necessary expertise to develop HIPAA-first healthcare software solutions. Our team prioritizes sensitive data protection and ensures that our client’s businesses are protected from noncompliance risks. Get in touch with us to navigate the complex landscape of HIPAA regulations and develop software solutions that meet the highest standards of security and compliance.


How do I comply with HIPAA in a startup?

Ensuring full HIPAA compliance is complex and challenging. First thing first, your startup should follow the latest practices for secure coding and testing. You should also embed the set of administrative and physical security measures to keep PHI protected from hackers and any other kind of unauthorized access.

What are HIPAA compliance requirements?

HIPAA compliance requirements include administrative, physical, and technical regulations healthcare startups and organizations should follow. Together, they form a protected health information security framework, where each of the measures is aimed at patient data breach or data leakage prevention.

How to improve HIPAA compliance?

To improve HIPAA compliance, you should get started with audits and identify the areas for improvement. Hiring a HIPAA consultant is the smartest tactic for this goal. 

Who is responsible for HIPAA compliance?

Under HIPAA, covered entities and their business associates are responsible for compliance with the regulations. Speaking simpler, healthcare providers, including digital healthcare, and their staff are responsible for it.