May 23, 2023

HIPAA and GDPR: They’re Basically the Same, Right? Not Exactly.

Most data managers and business decision makers recognize that GDPR and HIPAA both regulate data privacy and protect customer information from misuse and unauthorized access. And by this point, most of those responsible for company data decisions recognize that HIPAA is a long-standing rule often associated with medical information and the GDPR is relatively new and addresses general privacy for online customers and media subscribers.

But lately, many data managers are finding gaps in their understanding of how these two sets of rules differ. GDPR does, in fact, carry specific implications for healthcare providers. Any provider that interacts with or accepts data from any EU citizen must comply with the following restrictions:

Patient consent can no longer be assumed or accepted by default. Data consent must be explicit and traceable.

Patient data must be deleted permanently upon request. This is part of the “right to be forgotten” and it can pose a special challenge to those who manage medical histories.

High security and expanded storage are required by healthcare providers. For adequate security, encryption, redundancy, and intrusion detection, healthcare providers may need to expand their data platforms and storage in expensive ways.

Is HIPAA more strict than the GDPR?

Some healthcare data managers are relying on varied stringencies between the two policies and assuming that HIPAA (which has been in effect for many years) covers everything required by the GDPR. In other words, if the organization or practice is already HIPAA compliant, not much needs to be done to comply with the new law. But keep in mind that while HIPAA is organization-centric, the GDPR is patient-centric. HIPAA must maintain adequate data protection in data centers and locations inside the US, and so it does not extend to a US patient who receives healthcare treatment in a third country (like India). But the GDPR travels with a patient, so if a patient covered by the law receives treatment in a third country, their data must still be protected during transmission and storage.

Third-party marketers

In order to send out information or target marketing messages to patients, providers sometimes grant access to patient information to third party companies who handle the transaction (like marketing agencies or email managers). This isn’t a serious problem for HIPAA, which does not explicitly crack down on data sharing and transmission for this purpose, as long as the data doesn’t include direct identifiers like name, address, IP address, or photos.

GDPR, on the other hand, holds the third party explicitly responsible for all the provisions of the law and all requirements for patient consent.

Contact our office for more on the differences and similarities between these two sets of provisions, and how these differences may impact your business as a health care provider or partner.

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Frequently Asked
Questions

What type of compliance standard can you help with?

We help our clients based on their needs. The majority of our contracts involve SOC-2, HIPAA, and most recently GDPR. Feel free to ask us if we can help with your particular case. If we aren't able to, we can most likely recommend you to someone who can.

How long does a SOC 2 engagement usually take?

We move as fast as our clients are able to make progress. Our fastest client to date got their SOC-2 Type I four months after signing our engagement letter. That record is up for grab if you are up for it.

In our experience however, it takes 6-9 months to achieve a SOC-2 Type I,  and 3-6 additional months to obtain a SOC-2 Type II report.

Which standard do you follow for your security policies?

All of our security policies follow the ISO-27001 standard. The Confidentiality, Integrity, and Availability standards cover the range of standards we like to work with for SOC 2.

Why do we have to become SOC 2 compliant if we are relying on AWS which is already compliant?

SOC 2 stands for Service Organization Control, meaning your clients are interested in understanding your controls, not your hosting provider’s control. As part of your vendor assessment we recommend reviewing AWS’ SOC 2 report, but relying on their report is not enough to become SOC 2 compliant.

Who is behind SOC 2?

The American Institute of CPAs. The AICPA is an established and respected organization that provides two forms of audits to companies that demonstrate evidence of a secure data-protection infrastructure. A Type I is a point in time audit that addresses the company’s description of its system, the suitability of the system’s design, and the effectiveness of its internal data controls. A Type II report happens over a period of time and emphasizes design and also focuses on the validity of the company’s controls.

Are SOC 2 reports a legal obligation?

No, but most enterprise level organizations that engage with sensitive data (again, almost all of them) have an obligation to their stakeholders to prove due diligence regarding data security, which means they’ll want to vet their service providers using this tool. SOC 2 can help these prospective service providers set themselves apart from the competition. Just as important, a SOC 2 report represents a meaningful and respected signifier of trust.

What can happen to a company without a SOC 2 report?

A lack of a SOC 2 report won’t result in legal problems, but it can and will limit outside assessments of the company’s commitment to data security. When large-scale clients look for providers, or large-scale backers look for a likely return on their investment, they don’t want concerns about security to stand in the way. Trust is a chain made of links that have each been put the test and have proven their ability to withstand pressure and scrutiny. Company leaders are wise to let SOC 2 auditors apply this pressure so their clients and backers don’t have to.

When is it too late for a SOC 2 audit?

Never. Even companies that have been in business for years but have never obtained a SOC 2 report can—and should—take steps in this direction now. Being compliant with SOC 2 can open the door to a broader base of more significant clients and larger contract opportunities. That being said, startups in the threshold of the marketplace, and new business owners who hope for an eventual public offering, should obtain a SOC 2 report during the development and financing process. By the time the company approaches Series B and C fundraising rounds, a report should be in hand.

How complicated is the auditing process?

The auditing process can be easy, or complicated depending on your level of preparation.

Preparing for the audit can take some time, attention, and the guidance of reliable data security experts. Don’t leave any part of this process to chance. Approach SOC 2 compliance one step at a time, and start by contacting a consulting firm with track record of experience in your area of the marketplace.