Here's a conversation that happens more often than it should.
An Indian health-tech startup lands its first US client, a telehealth platform, a hospital network, maybe a health insurance company. The deal is exciting. The team has worked hard to get here. And then, buried in the contract, is a clause that says something like: "Vendor shall maintain compliance with the Health Insurance Portability and Accountability Act of 1996 and all regulations promulgated thereunder."
The founding team looks at each other. Someone Googles "HIPAA India." They find 47 tabs' worth of dense American regulatory text, a few compliance vendors charging eye-watering fees, and absolutely nothing written for a 30-person startup in Bengaluru trying to figure out what they're actually supposed to do by the contract start date.
This blog — and the checklist we've built to go with it, is for that team.
First, Let's Be Honest About What HIPAA Is
HIPAA is a US federal law. It was passed in 1996, primarily to protect the privacy and security of American patients' health information. It does not care where in the world you are based. If your product touches health data that belongs to US patients, or if you work with US healthcare providers, insurers, or their business partners, HIPAA applies to you.
That's the part that surprises most Indian founders. The assumption is often that foreign law is someone else's problem. It isn't. The moment you sign a contract with a US Covered Entity — which is the HIPAA term for hospitals, clinics, health insurers, and similar organisations — you become what's called a Business Associate. And Business Associates are legally required to comply with HIPAA. Not contractually encouraged. Legally required.
The US Department of Health and Human Services has levied fines against Business Associates based in countries outside the US. This is not theoretical. It happens.
What Indian Healthcare Startups Get Wrong
There are three mistakes I see consistently.
Mistake one: treating HIPAA as a one-time checkbox. A startup signs a Business Associate Agreement, adds "HIPAA compliant" to their website, and considers the job done. But HIPAA isn't a certification you earn and display. It's an ongoing operational standard. Your risk analysis has to be updated when things change. Your employees need annual training. Your security controls need to actually work, not just exist on paper. The companies that get into trouble with HIPAA are rarely the ones that never tried — they're usually the ones that tried once, declared victory, and never looked at it again.
Mistake two: assuming it doesn't apply to the technical team. HIPAA has administrative requirements, yes. Policies, procedures, documentation, training. But it also has deeply technical requirements — encryption standards, audit logging, access controls, transmission security, software development practices. Your engineering team needs to understand what Protected Health Information (PHI) is, where it lives in your system, and what safeguards are required around it. A backend developer who doesn't know that writing PHI to application logs is a HIPAA violation is a liability. Not through bad intent, but through unawareness.
Mistake three: ignoring the Indian regulatory layer. HIPAA compliance doesn't replace Indian law. If you're an Indian company, you're also subject to the Digital Personal Data Protection Act 2023, the IT Act 2000, the Sensitive Personal Data and Information Rules 2011, and if you're working with ABDM or Ayushman Bharat, additional Ministry of Health guidelines. These frameworks overlap with HIPAA in some areas and diverge in others. The safe approach is to follow the stricter standard wherever they conflict — which is usually HIPAA — while building controls that satisfy both simultaneously. Treating them as separate problems leads to gaps in both.
What HIPAA Actually Requires — The Plain Language Version
HIPAA has three main rules that matter for most health-tech startups.
The Privacy Rule governs how PHI can be used and disclosed. The core concept is something called the Minimum Necessary Standard — you should only access, share, or use the minimum amount of health information needed for the specific task at hand. This sounds obvious. In practice, it requires deliberate design decisions: role-based access that restricts what different employees can see, API responses that only return the fields the requester actually needs, analytics pipelines that work with de-identified data wherever possible.
The Security Rule is the technical and operational backbone of HIPAA. It covers three categories of safeguards: administrative (policies, training, risk analysis, designated Security Officer), physical (who can enter your server room, how devices are secured and disposed of, screen lock requirements), and technical (encryption, access controls, audit logs, transmission security). The Security Rule doesn't mandate specific technologies — it requires "reasonable and appropriate" measures based on your size, capabilities, and the risks to your data. That last part means you have to formally assess and document the risks, not just hope they don't materialise.
The Breach Notification Rule is exactly what it sounds like. If there's a breach of unsecured PHI, you have defined obligations to notify your Covered Entity client, the US Department of Health and Human Services, and sometimes the affected individuals directly — all within specific timeframes. If the breach affects 500 or more people, it becomes public. HHS maintains a searchable database of breaches. This is not the kind of press coverage anyone wants.
The Business Associate Agreement: Non-Negotiable
Before you handle a single byte of PHI for a US client, there must be a Business Associate Agreement (BAA) in place. This is a contract that specifies how you'll protect PHI, what happens if there's a breach, what you can and cannot do with the data, and what your sub-processors are permitted to do. Every cloud provider, every SaaS tool, every vendor in your chain that touches that PHI also needs a BAA with you.
This is where Indian startups often have a blind spot. You sign a BAA with your US client. But your infrastructure runs on standard AWS. Your logs go into a standard logging tool. Your team uses a standard collaboration platform. None of those have HIPAA BAAs in place. You're technically in violation before your first line of production code ships.
AWS, Azure, and Google Cloud all offer HIPAA BAAs. You have to actively request and sign them — they're not automatic. The standard consumer versions of these services are not HIPAA-eligible. Same goes for video conferencing tools used for telehealth, analytics platforms, customer support systems, and any other tool your organisation uses that might come into contact with PHI.
The Risk Analysis: The Most Cited Violation
If there's one thing HIPAA enforcement actions have in common, it's the absence of a documented risk analysis. The HHS Office for Civil Rights consistently finds, in breach investigations, that organisations either never conducted one or conducted one years earlier and never updated it.
The risk analysis is not a theoretical exercise. It's a formal, written assessment of every system that holds or processes ePHI, the threats and vulnerabilities those systems face, the likelihood and impact of those threats materialising, and what your existing controls do and don't mitigate. It's the foundation document that justifies all your other security decisions. Without it, you're not just missing a document — you're missing the evidence that you've thought seriously about security at all.
For an Indian startup, this means documenting your cloud infrastructure, your application architecture, your data flows, your employee access patterns, your third-party integrations, and your physical environment. It means thinking through scenarios like: what happens if a developer's laptop is stolen? What happens if an employee is terminated and still has access? What happens if a vendor has a breach? Write it down. Update it when things change.
Encryption Is Not Optional — And "Encrypted" Is Not One Thing
One of the most common technical misunderstandings is treating encryption as binary — either something is encrypted or it isn't. HIPAA's requirements are more specific than that.
PHI at rest must be encrypted. This means the databases holding patient records, the file storage containing medical images, the backups sitting on a cloud storage bucket, the developer's laptop with a local copy of the production database. All of it. Encryption at the disk level, not just the application level.
PHI in transit must be encrypted. This means TLS 1.2 or higher on every connection that carries PHI — not just the user-facing HTTPS, but the internal service-to-service calls, the database connections, the API calls to third-party systems. Standard SMS and email do not meet HIPAA transmission requirements. WhatsApp does not meet HIPAA requirements. If your telehealth platform has a message feature, it needs to use a HIPAA-compliant messaging system with a BAA.
The good news is that for startups building on modern cloud infrastructure, most of this is achievable without building custom cryptography. The work is in the configuration — making sure encryption is turned on, that the right key management is in place, that the defaults have been reviewed and tightened, and that somebody has actually verified the settings rather than assumed the defaults are sufficient.
What Happens When You Get It Wrong
HIPAA enforcement has teeth. The HHS Office for Civil Rights can levy civil monetary penalties ranging from USD 100 to USD 50,000 per violation, with annual caps based on the level of culpability. Wilful neglect — knowing there's a problem and not fixing it — carries the highest penalties, up to USD 1.9 million per violation category per year.
Beyond the fines, a HIPAA breach investigation is operationally disruptive. It involves document production, interviews, system audits, and corrective action plans. It affects your relationships with existing clients who need to assess their own exposure. It affects your ability to win new US healthcare clients. And in the age of public HHS breach reporting, it affects your reputation.
For an Indian startup, there's an additional dimension: a significant HIPAA violation can effectively close the US healthcare market. That's a market worth getting right.
The Checklist We Built
We've taken everything above — and considerably more — and compiled it into a detailed, printable checklist covering 17 sections and over 220 individual controls. It covers:
The HIPAA Privacy, Security, and Breach Notification Rules in operational detail. Business Associate Agreement requirements and what to look for before signing. The dual compliance challenge of satisfying both HIPAA and Indian data protection law simultaneously. Cloud infrastructure requirements for AWS, Azure, and GCP. Application security requirements specific to healthcare software. Telehealth and mobile health compliance. AI and machine learning with patient data — an increasingly relevant section as Indian health-tech companies build clinical decision support and diagnostic tools. Physical safeguards that apply even when your infrastructure is entirely cloud-hosted. Vendor and third-party risk management. Documentation, policy, and governance requirements.
Every item has a priority level — Critical, High, Medium, or Low — so you can work through it in the order that reduces the most risk first.
The checklist is not a substitute for legal advice, and we say so prominently at the top. HIPAA is complex law with evolving guidance, and a qualified US healthcare attorney and Indian technology law counsel are both worth the investment before you finalise your programme. But the checklist gives your team the operational detail to understand what needs to exist, so that your legal conversations are focused and efficient rather than starting from scratch.
One Last Thing
HIPAA compliance is genuinely achievable for Indian healthcare startups. It requires real work — technical work, operational work, and documentation work — but none of it is exotic. The startups that do it well treat it the same way they treat other engineering problems: systematically, with clear ownership, tracked to completion, and maintained over time.
The startups that struggle treat it as a one-time legal exercise, something to hand off to a consultant once and forget. That approach produces compliance theatre rather than actual security. And it's the approach that shows up in breach investigations.
Build it properly. Your US clients will notice the difference, and so will your patients.
Download the complete HIPAA Compliance Checklist for Indian Healthcare Startups
17 sections, 220+ controls, with priority ratings and implementation notes — from Bithost.
For HIPAA compliance audits, cloud security implementation, or SIEM and DLP setup for healthcare environments, reach us at sales@bithost.in or call +91 911-336-6525.
Bithost is backed by ZHOST Consulting Private Limited, Patna | Bangalore | Bhubaneswar.
