While medical providers are looking for ways to accommodate healthcare consumerization, the market of digital solutions for this sector keeps growing incessantly. It was valued at $200 Billion in 2020, and it’s anticipated to grow with a CAGR of 15% by 2028.

Since many companies invest in technologies to address patient needs and stay ahead of competitors, they should be aware of rules and regulations their software has to follow. No doubts that HIPAA is one of the most important requirements to meet when developing a health app.

What does it take to achieve HIPAA compliance, and how much do its violations cost? Let’s find out the basics and explore the considerations to take into account while initiating HIPAA compliant app development.

What Is HIPAA?

What is HIPAA?

Health Insurance Portability and Accountability Act, or HIPAA, is a US statute introduced in 1996 that regulates the flow of healthcare data. Part of this act specifies how personal information processed by healthcare and insurance companies should be protected from fraud and theft.

The need for your health application to be HIPAA compliant is defined by the type of entity that uses the app and the type of data covered by it. To give you more details, we’ll take a look at each of these criteria.


HIPAA is applicable whenever software processes Protected Health Information (PHI). It’s a set of data that’s generated during medical treatment or diagnosis. It also encompasses the information that identifies an individual.

Commonly, PHI includes:

When an app handles personal and medical data, it falls under HIPAA regulation. For example, if the application helps study skin diseases by analyzing anonymous images, it doesn’t have to be HIPAA compliant. However, if the same app monitors images that contain sensitive data like names, addresses, phone numbers, etc. — HIPAA comes into force.


HIPAA regulations apply to all entities that access, produce, process, and store PHI. According to Privacy Rule, there are two types of entities subjected to it: covered entities and business associates.

Covered entities refer to all healthcare organizations, providers, clearinghouses, and private practices. This type of entity also incorporates pharmacies, nursing homes, and insurers.

Business associates are organizations that collect, store, and handle PHI on behalf of the covered entities. They can include software and cloud service providers, lawyers, or accountants.

Why Is HIPAA Important?

HIPAA plays a vital role for both patients and healthcare organizations. It was enacted to help protect sensitive data and ensure that its processing and sharing are strictly regulated. The act provides important rules related to confidentiality and privacy, defines what parties can share information, to whom and how it can be disclosed.

Why is HIPAA Important?

Source: Someecards

HIPAA protects data from theft. In accordance with these regulations, PHI cannot be forwarded without patients’ consent and, if any breach appears, entities must notify patients. Obviously, it’s essential for an app to follow these rules since, in case of violations, HIPAA imposes penalties.

Risks and Penalties

Where is a rule, there can be a violation; and where is a violation, there can be a penalty. It’s hard to underestimate the importance of an app to be HIPAA compliant, so it’s better to be prepared and know what to expect in case of noncompliance.

Examples of major violations of HIPAA rules include the loss of data, accessing confidential information, or sharing PHI without authorization. The size of fines levied on entities varies from $100 to $50,000 per violation and can reach an annual maximum of $1.5 million.

With that in mind, let’s go further and explore the key tips to build a healthcare app compliant with HIPAA regulations.

Tips to Build a HIPAA Compliant App

4 Key Rules to Build a HIPAA Compliant App

Among all the rules incorporated in HIPAA, you should pay close attention to four of them. They are:

However, while working on your health software solution, the Security Rule is the one to focus on in the first place. It lays out three types of security safeguards to adhere to — administrative, physical, and technical. Each of them consists of standards and specifications that your development team has to follow.

We’ve summoned up the main steps to include in your medical app development process.

1. Limit Access to the App

To protect PHI from identity theft and unauthorized access, consider the implementation of the authentication process. It can be necessary to think about user roles with certain access rights as not every participant on the provider’s side needs to interact with all PHI details.

There are many ways to limit access to the app. For example, you can think about biometric or certificate-based authentication or apply multi-factor authentication that requires two or more ways to identify a user. Another effective method is to automatically log off idle users.

Learn how the Implementation of Two-User Roles Restricted Access to Mobile Medical Surveillance App

2. Ensure Data Integrity

Data integrity is extremally important for building HIPAA compliant software. The use of encryption technologies and secure communication channels allows health apps to protect sensitive data. They ensure that, even if a breach occurs, confidential information is safe because it can’t be decoded and read.

In addition to applying secure HTTPS connection and SSL/TLS protocols, it’s vital to transfer PHI following Healthcare Messaging Standards like HL7, FHIR, CDA, DICOM, etc. Keep in mind that data should be protected during both storage and transfer.

3. Implement an Audit Mechanism

Together with the security measures mentioned above, your medical app should control suspicious activities. Besides, it should track what users interact with an app and how they do it.

In order to achieve this, developers need to implement an audit procedure and create activity logs. It will enable recording and examining processes that involve the use of PHI.

4. Remove PHI from Push Notifications

As one of the features of your medical app, you may want to incorporate push notifications. In this case, consider excluding PHI from them. Even when the phone is locked, the data may appear on the screen and be visible publicly.

Similarly, don’t mention any sensitive data in messages or emails unless consent is given by a user. It might happen that not all communication channels are encrypted, thus medical and other personal information can be easily compromised.

Reach HIPAA Compliance with the Right Expertise

Besides having an idea and a development strategy for your healthcare app, it’s fundamental to think about HIPAA compliance. Primarily, focus on the security measures to protect PHI and ensure data integrity.

HIPAA regulations require some effort to understand and follow them to the letter. However, noncompliance entails significant risks and penalties. The relevant expertise of a development team will help you build a medical tech solution in accordance with these rules and your goals.

Velvetech has a rich experience in healthcare app development that’s reinforced with profound knowledge of the field. Our team’s skills will support you with the implementation of robust eHealth software, compliant with all essential aspects of HIPAA. Reach out to us today.

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