What is a "covered entity" according to HIPAA?

A "covered entity" under HIPAA refers to organizations or individuals that engage in certain activities involving the transmission of health information. Specifically, these entities include healthcare providers who transmit data in electronic form in connection with a HIPAA transaction, such as billing insurance, health plans that provide or pay for medical care, and healthcare clearinghouses that process such information.

By this definition, options that suggest limited categories, such as only insurance companies or individuals interacting with patients, do not encompass the broader range of entities that qualify under HIPAA. Those entities play a vital role in managing, transmitting, or processing health information, underscoring their importance in maintaining the privacy and security rules mandated by HIPAA. The correct understanding emphasizes that any organization or person involved in these activities qualifies as a covered entity, thus ensuring comprehensive protection of health information.