Disclaimer: This article was originally published in November 2023 and was updated in October 2025 for comprehensiveness.
HIPAA (Health Insurance Portability and Accountability Act) compliance typically costs between $10,000 and low six figures, depending on your size, risk profile, and current controls.
The right plan focuses spending on the biggest risks first, so you avoid fines, breaches, and wasted tools.
HIPAA is a critical piece of legislation designed to safeguard the privacy and security of patients' health information, but its compliance requirements is a complex and costly endeavor.
Intelligent Technical Solutions (ITS) is a managed IT and cybersecurity provider that helps healthcare organizations and business associates assess risk, close control gaps, train staff, and maintain documentation so they stay compliant while they grow.
In this guide you will learn:
The cost of achieving and maintaining HIPAA compliance can vary widely based on several factors, each of which influences the overall financial commitment of businesses. These factors include:
Larger environments with multiple locations, mixed cloud and on premises systems, and many third parties require more assessment time, more remediation work, and broader training. Small clinics still need the same safeguards, but the scope is smaller.
The state of your existing IT infrastructure is also a major factor. Outdated systems, legacy servers, unsupported operating systems, and flat networks add remediation costs.
Modernized environments with identity controls, endpoint protection, and backups already in place require you to spend less to reach compliance.
Expect spend in these categories: risk analysis, policies and procedures, identity and access management, endpoint protection, encryption at rest and in transit, logging and alerting, secure backup and recovery, vendor due diligence, and workforce training.
Annual HIPAA training for all workforce members, role-based training for privileged users, and tabletop incident exercises should be planned as recurring line items. Add time for policy reviews, management sign off, and documentation updates.
READ: Employee Cybersecurity Training & You: 6 Effects on Businesses
You must inventory vendors, execute BAAs (Business Associate Agreements), assess their controls, and monitor ongoing risk. Cloud and EHR partners often reduce your tooling costs but increase due diligence workload.
Enforcement priorities, guidance, and state privacy laws evolve. Build an annual review cycle so you can adjust policies, notices, consents, and technical controls without surprise spend.
There's no one-size-fits-all answer, but we’re here to give you a general overview.
For organizations with about 50 employees or fewer, a practical initial program often includes:
Typical range: roughly $10,000 to $50,000 for first year activities, depending on preparedness and technology debt. Ongoing costs are lower and tied to renewals, audits, and training.
In the case of larger organizations, costs tend to increase due to additional expenses associated with:
Typical starting point: $50,000 to $150,000+ for first year activities, with ongoing spend driven by monitoring, testing, and audit cadence.
Overlapping security tools, unused features, custom policies that are never implemented, and one-time assessments without remediation plans. Tie every purchase to a documented risk and a control requirement.
MFA on all remote and admin access, least privilege and quarterly access reviews, encrypted backups with recovery testing, EDR with monitoring, and email security with user training.
Risk analysis reports, remediation evidence, policy versions with approval dates, training rosters, BAA list, incident response plan, vulnerability and patch records, and test results for backups and recovery.
HIPAA is required for any organization that creates, receives, maintains, or transmits PHI.
The cost is manageable when you focus on the highest risks first, replace tool sprawl with managed outcomes, and build an annual review cycle.
The decision to invest in HIPAA compliance should not be taken lightly.
While the cost of HIPAA compliance can present a financial challenge for businesses, it needs to be viewed as an investment in both the protection of sensitive patient data and the long-term viability of your healthcare enterprise.
At ITS, we help hundreds of businesses maintain compliance by strengthening their cybersecurity. At the same time, we also ensure that we adhere to the highest industry standards as a managed security service provider. In that way, we can provide our clients with quality service.
Contact us today for a free cybersecurity assessment and advice on maintaining HIPAA compliance. You may also read the following related resources in our Learning Center:
A: Yes. If you handle PHI as a covered entity or business associate, you must comply regardless of size.
A: You must perform risk analysis regularly and update it after major changes such as new systems, mergers, or incidents.
A: Technology debt and process gaps. Modernized environments with strong identity, patching, and backups spend less to close gaps.
A: Yes. Effective employee training lowers incident frequency, improves audit results, and reduces remediation workload.
A: You need BAAs with vendors that create, receive, maintain, or transmit PHI on your behalf, and you must assess their technology safeguards.