Fundamentals of HIPAA Practice Exam

Under HIPAA, a covered entity is specifically defined to include health plans, healthcare clearinghouses, and healthcare providers who engage in the electronic transmission of health information. This definition is crucial as it establishes which organizations and individuals are required to comply with HIPAA regulations regarding the protection and privacy of health information.

Health plans include entities that provide or pay for the cost of medical care, such as insurance companies. Healthcare clearinghouses process health information received from another entity, improving the efficiency of data exchange. Healthcare providers, such as doctors and hospitals, become covered entities when they transmit any health information electronically in connection with a covered transaction.

This distinction is important because it delineates the responsibilities and obligations that these entities have in terms of safeguarding the privacy and security of sensitive health information, ensuring compliance with HIPAA’s standards and regulations.