HIPAA compliance includes multiple layers of requirements that touch every aspect of how healthcare organizations handle patient information. The Privacy Rule governs how PHI can be used and disclosed, while the Security Rule establishes technical, administrative, and physical safeguards for electronic PHI (ePHI). The Breach Notification Rule requires prompt reporting of data breaches, and the Omnibus Rule extends liability to business associates who handle PHI on behalf of covered entities.
45 CFR Part 164, Subpart C states that healthcare organizations must implement access controls, encrypt data both at rest and in transit, conduct regular risk assessments, maintain audit logs, train staff on privacy practices, and establish incident response procedures. They must also ensure that all vendors and business associates who handle PHI meet the same compliance standards through proper business associate agreements (BAAs).
For smaller healthcare practices, these requirements can be overwhelming. As noted in Cybersecurity as a Service, "Currently over half of all small businesses close within six months of a malware attack," showing the consequences of inadequate security measures. The compliance challenge is widespread across all business sectors—according to Why Continuous Compliance Monitoring Is Essential For IT Managed Service Providers published by The Hacker News, "60% or more are not fully compliant with at least one regulatory standard." Even larger organizations often struggle to maintain the specialized expertise needed to stay current with evolving compliance requirements while focusing on their primary mission of patient care.
The MSP advantage in HIPAA compliance
As Pamela Winikoff notes in Channel Insider, "MSPs bring specialized expertise in healthcare workforce and IT management, including compliance with regulatory standards such as HIPAA." Their value proposition centers on taking responsibility for the technical infrastructure that supports compliant operations while allowing healthcare organizations to focus on patient care.
MSPs approach HIPAA compliance through systematic infrastructure management. They ensure that all systems handling ePHI are properly configured with appropriate access controls, encryption, and monitoring capabilities. This includes managing servers, networks, workstations, and mobile devices according to HIPAA Security Rule requirements. As noted in MSP HIPAA Compliance: Key Requirements, Challenges & Solutions, "MSPs assist healthcare organizations in implementing and maintaining strict HIPAA security measures." According to Channel Insider, "MSPs can play a key role in fortifying IT infrastructure by implementing encryption protocols, conducting rigorous security audits" and providing security measures that healthcare organizations need to maintain compliance.
Perhaps most importantly, MSPs bring consistency to compliance efforts. Traditional approaches to compliance monitoring have limitations. As explained in The Hacker News article, "Traditional compliance audits have been conducted periodically—often annually or quarterly. However, this approach leaves gaps where security threats and compliance violations can go unnoticed." MSPs establish standardized procedures for system configuration, user provisioning, and security updates that reduce the risk of human error—an important consideration given that, according to Cybersecurity as a Service, "95% of current company malware breaches are caused by human error." Their managed approach means that compliance measures are implemented uniformly across all systems and maintained continuously rather than being addressed sporadically during internal IT initiatives.
MSPs also provide documentation and reporting capabilities. HIPAA compliance requires documentation of security measures, risk assessments, and incident responses. MSPs typically maintain detailed records of system configurations, security events, and maintenance activities that can be essential during compliance audits or breach investigations.
However, implementing MSP services comes with its own challenges. According to MSP HIPAA Compliance: Key Requirements, Challenges & Solutions, common obstacles include "integrating MSP services with clients' legacy systems" and "resolving expertise gaps between providers and users." These challenges require planning and coordination between MSPs and healthcare organizations to ensure smooth implementation while maintaining compliance throughout the transition.
While MSPs focus broadly on technology infrastructure, Managed Security Service Providers offer specialized expertise in the security aspects of HIPAA compliance. Winikoff emphasizes that "MSPs can play an instrumental role in safeguarding HIPAA standards for patient privacy and maintaining the security of protected health information (PHI)" that providers are required to follow. MSSPs operate security operations centers (SOCs) that provide 24/7 monitoring of healthcare networks, enabling rapid detection and response to potential security incidents.
The continuous monitoring capabilities of MSSPs are valuable for HIPAA compliance, especially considering that "the volume of malware attacks are set to increase and become more sophisticated, particularly with the advent of malware enhanced by artificial intelligence" states Cybersecurity as a Service. As noted in Why Continuous Compliance Monitoring Is Essential For IT Managed Service Providers, MSSPs can "detect compliance issues as they happen rather than waiting for an annual audit." As Larisa Albanians notes in How MSSPs Can Help Healthcare Organizations Meet and Exceed HIPAA Compliance, "Continuous monitoring of IT systems is vital to detect and respond to security incidents promptly." They implement security information and event management (SIEM) systems that collect and analyze log data from across the healthcare organization's infrastructure. This monitoring helps identify unauthorized access attempts, unusual data access patterns, and other indicators of potential breaches. Early detection is important under HIPAA's breach notification requirements, which mandate reporting breaches to patients and regulators within specific timeframes.
MSSPs also bring advanced threat intelligence capabilities that help healthcare organizations stay ahead of emerging cyber threats. The healthcare sector faces unique security challenges, including targeted ransomware attacks and efforts to steal valuable medical records. MSSPs maintain threat intelligence feeds and analysis capabilities that help identify and mitigate these sector-specific risks.
Vulnerability management represents another MSSP capability. Healthcare organizations often struggle to maintain current security patches across diverse technology environments that include everything from electronic health record systems to medical devices.
The relationship between healthcare organizations and their MSP or MSSP partners typically involves a business associate agreement that defines how each party will handle PHI and allocate compliance responsibilities. These agreements are important because they extend HIPAA liability to the service provider while clarifying expectations and responsibilities. As explained in MSP HIPAA Compliance: Key Requirements, Challenges & Solutions, "When an MSP provides a service to a HIPAA entity, it does so as a business associate."
Under a properly structured BAA, the MSP or MSSP assumes responsibility for implementing and maintaining technical safeguards for any systems they manage that handle ePHI. This includes ensuring appropriate access controls, encryption, audit logging, and backup procedures. They also typically assume responsibility for incident detection and initial response activities within their managed environment—a critical capability given that, as noted in Cybersecurity as a Service, "Companies should not ask themselves if they are vulnerable to a security incident but only when and to which extent this incident may occur."
However, healthcare organizations retain ultimate responsibility for HIPAA compliance and must ensure their service providers meet all applicable requirements. This creates a shared responsibility model where the healthcare organization defines compliance requirements and policies while the MSP or MSSP implements and maintains the technical controls that support those requirements. One key challenge in this relationship is "establishing levels of client control," as noted in MSP HIPAA Compliance: Key Requirements, Challenges & Solutions.
The business associate relationship also extends to breach notification responsibilities. MSPs and MSSPs must promptly notify their healthcare clients of any suspected or confirmed breaches involving PHI. They also typically assist with breach investigation and remediation activities, though the covered entity retains responsibility for patient and regulatory notifications.
Learn more: What does it mean to be a business associate?
For many healthcare organizations, partnering with MSPs and MSSPs represents a more cost-effective approach to HIPAA compliance than building internal capabilities. The specialized expertise required for compliance programs often exceeds what smaller healthcare practices can justify maintaining internally, particularly given the current cybersecurity skills shortage. As noted in Channel Insider, "By outsourcing IT and HR management tasks, organizations can avoid the expenses associated with hiring and training in-house IT staff" while gaining access to enterprise-level compliance capabilities.
The financial impact of inadequate compliance management can be severe. A case study cited in Why Continuous Compliance Monitoring Is Essential For IT Managed Service Providers illustrates this challenge: "Before using Compliance Manager GRC, compliance was drowning us. One law firm client alone was costing us $5,000 a month in lost revenue and wasted time on audits and documentation. We had to walk away."
MSPs and MSSPs achieve cost efficiencies through economies of scale. Their specialized tools, processes, and expertise can be shared across multiple healthcare clients, reducing the per-client cost compared to each organization building similar capabilities independently. This model allows smaller healthcare practices to access enterprise-level security and compliance capabilities at a fraction of the cost of internal implementation. The managed service approach also recognizes that "companies are beginning to integrate Secure Software Engineering into the relevant value chains" as noted in Cybersecurity as a Service, providing healthcare organizations with access to these advanced security engineering practices.
The managed service model also provides predictable cost structures that help healthcare organizations budget for compliance activities. Rather than facing large capital expenditures for security tools and staff, organizations can typically engage MSPs and MSSPs through ongoing service agreements that provide clear cost visibility and alignment with compliance requirements.
Resource optimization extends beyond cost considerations to include access to specialized expertise that may be difficult to recruit and retain internally. The cybersecurity skills shortage affects healthcare organizations particularly acutely, as they compete with other industries for limited talent while often lacking the compensation structures needed to attract top security professionals. MSPs and MSSPs provide access to this expertise without the challenges of direct recruitment and retention.
Read also: Simplify HIPAA compliant email for your clients
HIPAA compliance focuses on legal requirements for handling protected health information (PHI), while cybersecurity addresses the broader technical measures to protect all data and systems.
Not necessarily—many healthcare organizations use a hybrid approach, combining internal staff with external managed service providers.
HIPAA compliance is continuous and requires regular assessments, updates, and monitoring.
Yes, if they handle PHI as business associates of covered entities, such as law firms, billing companies, or cloud service providers.
Not always—HIPAA compliance also requires access controls, audit logs, policies, and proper handling of PHI beyond just encryption.