Imported item 10
A covered entity under HIPAA is a health plan, a health care clearinghouse, or a health care provider that conducts specified electronic transactions. Handling health information alone does not establish this status. Life sciences organisations should assess their actual activities and relationships before describing themselves as covered entities.
Key takeaways
- HIPAA identifies three covered-entity categories, with an electronic standard-transaction condition applying to the health care provider category.
- A business associate performs qualifying functions or services for a covered entity involving protected health information and has separate responsibilities.
- A biotech sponsor does not become a covered entity solely because a study involves health data or a US hospital.
The Three Categories
HHS explains that HIPAA applies to covered entities and business associates. A business associate relationship depends on the services and data involved, not simply on whether someone receives information from a hospital.
HHS research guidance separately describes conditions for research uses and disclosures. A sponsor receiving data for its own research is not automatically acting on behalf of the hospital as a business associate. The facts and applicable disclosure route need examination.
Why It Matters for Data Protection
Operationally, document the HIPAA assessment before choosing contract wording. Identify the entity, activity, data, purpose and relationship, then determine whether a business associate agreement or another research arrangement is appropriate.
For example, consider a hypothetical biotech that both sponsors studies and provides a hospital analytics service. The two activities may require different analyses. We recommend assessing them separately rather than applying one organisation-wide label without checking the services.
Frequently Asked Questions
Is every health app a covered entity?
No. Health-related content or functionality alone does not establish covered-entity status.
Can a covered entity also be a business associate?
Yes, when it performs a qualifying service for another covered entity.
Does being outside HIPAA remove all privacy duties?
No. Other laws and contractual obligations may still apply to the processing.
Related: HIPAA; business associate agreements; HIPAA scope assessment.
Updated: 27 October 2026
