Business Associate Agreements: More Readily Accepted by Cloud Service Providers? Maybe

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Although the HIPAA Omnibus Final Rule's expansion of business associate liability could create difficulties for healthcare providers and other covered entities seeking to negotiate business associate agreements with vendors for the storage and maintenance of protected health information (PHI), cloud service providers (CSP) could be more receptive to such arrangements thanks to recent developments concerning Amazon Web Services (Amazon) and its relationship with HHS. Earlier this month, Amazon became the first CSP to achieve nonprovisional "authority to operate" status in the Federal Risk and Management Program (FedRAMP). FedRAMP, overseen by the General Services Administration, was established in December 2011 to provide a streamlined process across the federal government for identifying and certifying "secure, reliable, and cost-effective cloud options." Office of Management and Budget policy requires federal agencies, such as HHS, to use such services as a way of effectively managing IT where feasible. Amazon provides cloud services to HHS, including hosting of HealthData.gov. In order to achieve nonprovisional status, Amazon was required to undergo a third party security assessment and to receive HHS approval. Now that HHS and Amazon are working together, covered entities should find CSPs more receptive to entering into business associate agreements.