Health Insurance Portability and Accountability Act (HIPPA) Practice Exam

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Which statement about Business Associate Contracts is FALSE?

  1. Business Associates are required to obtain "satisfactory assurances" from their subcontractors

  2. Business Associates must protect PHI as per HIPAA regulations

  3. They are not required to sign a contract with covered entities

  4. Contracts specify permitted uses and disclosures of PHI

The correct answer is: They are not required to sign a contract with covered entities

The assertion that Business Associates are not required to sign a contract with covered entities is false. Under HIPAA regulations, Business Associates must enter into a Business Associate Contract (BAC) with covered entities. This contract serves as a crucial legal agreement outlining the responsibilities of the Business Associate regarding the handling of Protected Health Information (PHI). These contracts are essential because they provide the necessary "satisfactory assurances" that the Business Associate will appropriately safeguard PHI and comply with HIPAA privacy and security rules. The contracts also detail the permitted uses and disclosures of PHI, ensuring both parties understand their obligations under the law. Therefore, the requirement for a written contract is fundamental to the compliance framework that governs interactions between covered entities and their Business Associates.

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