A Service Level Agreement (SLA) is not the same thing as a Business Associate Agreement (BAA); they are distinct types of agreements serving different purposes. An SLA primarily focuses on defining and measuring the technical and service-related performance standards agreed upon between a service provider and its customer.
SLAs are a tool for operational management and contractual compliance for service quality, but are generally commercial contracts. A study on the IT aspects of SLA’s published in the Information System Frontline notes, “SLAs contain a variety of parameters such as response time, bandwidth, storage, reliability, deadline, throughput, delay, and cost that must be maintained by a provider. The provider must measure and monitor these parameters during the service to avoid violations that have been agreed in the SLA.”
In contrast, a BAA is a specific legal contract required by HIPAA. It applies when a business entity (referred to as a business associate) handles, processes, or has access to protected health information (PHI) on behalf of a healthcare-covered entity or its customers.
In practical terms, an SLA and a BAA may coexist within the same vendor relationship but serve complementary roles. For example, in a healthcare context, a cloud service provider may have an SLA outlining uptime and technical support guarantees and a BAA addressing how PHI is handled and secured in compliance with HIPAA.
While the SLA manages the technical delivery of the service, the BAA governs the privacy and security obligations related to the healthcare data processed under that service.
An SLA formalizes commitments on service delivery and performance objectives, which often include service availability, incident response, and resolution timelines. The SLA acts as both a communication and conflict resolution tool, reducing ambiguity around service levels and providing mechanisms for addressing any failures or breaches. In IT service management, SLAs typically specify performance metrics such as bandwidth, latency, and downtime limits, and providers are obligated to monitor and report on these parameters to avoid penalties or remedial actions.
In advanced healthcare technology contexts, like 5G-enabled medical devices, SLAs increasingly incorporate cybersecurity requirements to mitigate risks like denial-of-service attacks or unauthorized data access. According to an IEEE Access study on the application of SLA’s for 5G in healthcare notes, “Service level agreements (SLAs) can enable 5G-enabled medical device use cases by documenting how a medical device communication requirements are met by the unique characteristics of 5G networks and the roles and responsibilities of the stakeholders involved in offering safe and effective 5G-enabled healthcare to patients.”
These SLAs change to cover performance and security protocols, threat response plans, and ongoing system assessment. Healthcare organizations encounter SLAs primarily when engaging with external service providers supplying technologies, networks, cloud services, or medical devices that affect clinical operations and patient care. These agreements are used internally and externally to improve process transparency, performance monitoring, and service delivery reliability. Hospitals may have SLAs with IT vendors managing electronic health records or telemedicine platforms, ensuring uptime and support that directly impact clinical workflows.
According to the HHS guidance for professionals, “A written contract between a covered entity and a business associate must: (1) establish the permitted and required uses and disclosures of protected health information by the business associate; (2) provide that the business associate will not use or further disclose the information other than as permitted or required by the contract or as required by law.”
It ensures that business associates comply with HIPAA’s requirements for the privacy and security of PHI. HIPAA’s requirement for a BAA is strengthened by the HITECH Act and the HIPAA Omnibus Rule, which also made business associates directly liable for compliance with certain HIPAA provisions.
A business associate can include a variety of service providers that handle PHI, including cloud storage providers, IT support companies, billing services, legal firms, shredding companies, or medical equipment repair firms. The BAA requires that these associates must not use or further disclose PHI beyond what is allowed in the agreement, ensuring strict control over information flows.
The agreement mandates that subcontractors engaged by a business associate who may also have access to PHI comply with the same HIPAA standards, thereby extending regulatory protections downstream.
While SLAs govern service performance, and BAAs govern data protection and privacy compliance, healthcare organizations often encounter situations where both agreements are interlinked and must coexist.
The function of the SLA in this environment is noted in the Frontiers in Medicine study ‘From data to medical context: the power of categorization in healthcare,’ “By incorporating important but often overlooked components such as social determinants, Service Level Agreements (SLAs), and environmental factors our model enhances clarity and strengthens decision-making in clinical settings,” a cloud service provider delivering IT infrastructure to a hospital will have an SLA specifying system availability guarantees and helpdesk response performance.
Simultaneously, the provider will enter into a BAA with the hospital to guarantee that any PHI stored or processed within that infrastructure is secured under HIPAA’s security framework. Here, the SLA assures the provider meets operational expectations, while the BAA assures legal compliance regarding sensitive health data.
This dual-agreement framework addresses different but equally necessary dimensions of healthcare service delivery. Without an SLA, a healthcare organization risks operational failures that may compromise patient care due to service outages or slow incident responses.
In many cases, a BAA can be included as an addendum to a broader Master Service Agreement (MSA) that contains the SLA provisions, ensuring a comprehensive contractual approach that balances business performance and legal compliance.
SLAs in healthcare have evolved beyond traditional IT service metrics to incorporate cybersecurity policies, data privacy protections, and continuous compliance monitoring as healthcare becomes increasingly digitized. SLAs now often include requirements related to encryption standards, audit logs, incident reporting timelines, and recovery plans aligned with HIPAA mandates.
This convergence shows the need for healthcare organizations to directly embed regulatory obligations into their operational service agreements. BAAs enforce HIPAA compliance obligations by defining clear accountability among service providers handling PHI while SLAs help maintain the quality and availability of the same IT services that process such protected information.
You want to define and measure specific service performance standards (e.g., uptime, response time, system availability).
You need to ensure quality and reliability of IT services, cloud infrastructure, or vendor support.
The focus is on technical service delivery, operational performance, and managing service expectations.
The agreement is between a healthcare organization and any service provider for technology or operational services.
You want to set clear performance goals and remedies for service failures.
A third-party vendor or service provider will access, transmit, or store PHI on behalf of a HIPAA-covered entity.
The focus is on legal compliance with HIPAA privacy and security rules concerning health data protection.
You need a legally binding contract to ensure the vendor implements safeguards to protect PHI.
The business associate must report breaches, limit data use, and comply with HIPAA requirements.
A service provider handles PHI and also delivers measurable service performance.
The healthcare organization requires assurance for both regulatory compliance (via BAA) and service quality (via SLA).
See also: HIPAA Compliant Email: The Definitive Guide (2025 Update)
Yes. After the HIPAA Omnibus Rule and the HITECH Act, subcontractors of business associates who have access to PHI must also comply with HIPAA requirements, and a downstream BAA should be in place between the business associate and its subcontractors.
BAAs require business associates to support patients’ HIPAA rights, including providing access to their PHI, allowing amendments, and accounting for disclosures when requested by the covered entity or the individual.
No. Before disclosing PHI to any third party that qualifies as a business associate, a covered entity must have a signed BAA to comply with HIPAA regulations.