Which type of organizations must comply with HIPAA?

The correct answer identifies all covered entities that work with HIPAA business associates as those required to comply with HIPAA regulations. Covered entities refer to organizations that transmit any health information in electronic form in connection with a HIPAA transaction, which includes healthcare providers, health plans, and healthcare clearinghouses.

Furthermore, business associates are third-party entities that perform functions or activities on behalf of a covered entity that involve the use or disclosure of protected health information (PHI). Since business associates can impact the way health information is handled, both the covered entities and their business associates must comply with HIPAA rules to ensure the privacy and security of health information.

Recognizing the compliance requirement extends beyond just healthcare providers and insurance companies showcases the comprehensive scope of HIPAA, emphasizing that any organization participating in the health ecosystem, especially those involved in handling PHI, must adhere to these regulations to protect patient information effectively.