HIPAA vs GDPR Compliance: A practical guide for enterprises and SecOps

Most businesses manage data across 14 or more systems. Cloud apps, mobile devices, internal tools, and external vendors. Keeping track of where personal or sensitive data goes isn’t an easy feat. Now, layer compliance and regulations onto this already complex scenario.

What’s acceptable? What’s non-negotiable? How do you categorize it all?

Whether it’s HIPAA, GDPR, or other regulations, they aren’t rules to follow. They’re blueprints for protecting your data.

Helping you with the right compliance and ensuring you’re always audit-ready. Understanding the difference between GDPR and HIPAA is essential for any business handling sensitive or regulated data. It helps businesses stay clear of gaps, fines, and reputational risks.

Get this right, and compliance becomes a strategic advantage. Get it wrong, and you’re one breach or audit away from a major setback.

What is HIPAA, and why is it required?

HIPAA stands for the Health Insurance Portability and Accountability Act. It’s a U.S. federal law created in 1996. The goal? Protect patient health information (PHI). HIPAA ensures healthcare organizations handle medical data with care, confidentiality, and accountability.

So, who needs to be HIPAA compliant?

Pretty much anyone in the U.S. handling protected health info, dealing with PHI.

Think: hospitals, insurance providers, healthcare SaaS companies, and even third-party vendors such as billing or cloud storage partners.

A healthcare data breach can lead to serious legal, financial, and reputational damage. The healthcare community has started adopting digital systems like EHR and CPOE. As such, HIPAA compliance becomes essential to protect sensitive data. These technologies improve efficiency and mobility but also increase security risks.

The HIPAA Security Rule allows healthcare organizations to adopt new technologies while still protecting patient privacy. It’s designed to be flexible, so each organization can implement safeguards based on its size, complexity, and the specific risks to electronic protected health information (e-PHI).

Physical and technical safeguards for HIPAA compliance

• Physical Safeguards:
  • Limited facility access with authorized personnel only.
  • Policies on workstation and electronic media use and access.
  • Restrictions on transferring, removing, disposing of, and reusing electronic media and ePHI.
    
• Technical Safeguards:
  • Access control to allow only authorized personnel to access ePHI, including unique user IDs, emergency access, automatic logoff, and encryption.
  • Audit reports and logs to track activity on hardware and software.
  • Integrity controls to prevent alteration or destruction of ePHI.
  • IT disaster recovery and off-site backup to ensure accurate recovery of patient data.
  • Network security to protect against unauthorized access to ePHI during transmission, including email, internet, or private networks.
    
• HITECH Act:
  • The HITECH Act increased penalties for HIPAA violations, responding to the rise of health technology and the growing use of electronic health data.

Fines and penalties for non-compliance

Failing HIPAA can cost millions in fines, based on the nature and severity of the violation. Here’s a breakdown:

• Tier 1: Unknowingly violating HIPAA – If you aren’t aware of the violation, fines range from $100 to $50,000 per violation, with a maximum of $1.5 million per year. Ignorance won’t protect you.
• Tier 2: Reasonable cause – If you fail to comply but can show reasonable cause, you’ll face fines up to $1,000 per violation, capping at $100,000 per year.
• Tier 3: Willful neglect, corrected within 30 days – If a violation is due to willful neglect but corrected quickly, fines jump to $10,000 per violation, with a max of $250,000 annually.
• Tier 4: Willful neglect, not corrected – The most severe penalty, where fines soar up to $50,000 per violation and can total $1.5 million annually.

What is GDPR, and why is it required?

GDPR is the General Data Protection Regulation. It’s a European Union law that came into force in 2018. GDPR aims to give individuals more control over their personal data. It’s about transparency, accountability, and privacy.

Any business handling the personal data of EU citizens must comply with GDPR—even if the business isn’t based in Europe.

GDPR protects names, emails, IP addresses, biometric data, and more. It’s required to reduce the misuse of personal data and hold companies accountable for privacy.

It is privacy with purpose, not paperwork.

Who comes under GDPR?

If you offer goods or services to EU citizens or monitor their online behavior, GDPR applies. This includes:

• EU-based businesses
• Non-EU businesses targeting EU customers
• Cloud services processing EU user data

GDPR isn’t limited by geography. It’s about who’s affected, not where the business operates.

Special considerations under GDPR

The GDPR goes beyond simple consent. It’s about what happens after you collect someone’s personal data: how you store it, use it, and protect it. To keep people’s information safe, GDPR says any personally identifiable information (PII) you collect must be:

• Anonymized – Stripped of all identifiers so it can’t be linked back to a person
• Pseudonymized – Replaced with fake names or codes to mask someone’s identity during processing

This setup gives businesses more freedom to work with data, without crossing privacy lines. It’s a smart way to get deeper insights while still respecting user privacy.

Key points to note:

• GDPR applies to all 27 EU countries and the EEA.
• It’s jurisdiction-agnostic: If your website collects data from EU citizens, you must comply, no matter where your business is based.
• EU citizen data is protected even if it’s stored in the U.S.
• A U.S. citizen living in the EU is also covered when accessing EU-based websites.

Bottom line: If your site touches EU data, GDPR touches you.

Fines and penalties for non-compliance

The severity of GDPR fines is determined based on factors like the nature of the infringement, the number of individuals affected, the level of damage incurred, and whether the violation was intentional or due to negligence.

• Tier 1 Violations: Fines up to €10 million or 2% of global annual turnover. These apply to infractions such as inadequate record-keeping, failure to notify authorities of data breaches, and insufficient data protection impact assessments.
• Tier 2 Violations: Fines up to €20 million or 4% of global annual turnover. These pertain to more severe breaches, including violations of data subjects’ rights, unlawful data processing, and unauthorized international data transfers.
  

Company	Fine Amount	Date	Reason for Fine
Meta	€1.2 billion	May 2023	Transferred EU user data to the U.S. without adequate safeguards, violating Schrems II ruling.
TikTok	€530 million	May 2025	Illegally transferred European user data to China without ensuring equivalent data protection.
LinkedIn	€310 million	November 2024	Processed personal data for advertising without a lawful basis.
Uber	€290 million	August 2024	Improperly transferred EU driver data to U.S. servers without adequate safeguards.
TikTok	€345 million	September 2023	Mishandled children’s data, including inadequate age verification and default public profiles.
Meta	€390 million	January 2023	Changed legal basis for data processing without proper user consent, affecting Facebook and Instagram users.

Key differences: HIPAA vs GDPR

By now, it’s clear that when it comes to data protection, HIPAA and GDPR aren’t interchangeable. 

They’re built for different worlds.

One’s all about health data in the U.S., the other protects personal info across the EU. Here’s a quick rundown to help you see where they align and where they don’t. 

Aspect	Health Insurance Portability and Accountability Act (HIPAA)	General Data Protection Regulation (GDPR)
Region of applicability	United States	European Union (EU) + European Economic Area (EEA)
Primary objective	Protect individuals’ medical records and personal health information	Protect personal data and privacy of all individuals in the EU/EEA
Scope of data	Protected Health Information (PHI/ePHI) only	All personal data (name, email, IP address, biometric data, etc.)
Covered entities	Healthcare providers, insurers, clearinghouses, and business associates	Any organization processing EU citizens’ data (regardless of location)
Legal basis for processing	Focuses on permitted uses/disclosures of PHI without consent	Requires lawful grounds: consent, contract, legal obligation, etc.
Consent requirements	Implied or written consent for most uses; stricter for marketing	Explicit, informed, freely given, and easy to withdraw
Individual rights	Limited: access and amendment rights; no right to deletion	Extensive: access, rectify, erase, restrict, portability, objection
Data breach notification	Notification required within 60 days to affected individuals + HHS	Mandatory within 72 hours to supervisory authority
Enforcement body	U.S. Department of Health and Human Services (HHS), Office for Civil Rights (OCR)	Data Protection Authorities (DPAs) in each EU member state
Penalties for violation	Tiered civil penalties up to $1.5 million per year per violation type	Up to €20 million or 4% of annual global turnover
Data minimization	Not explicitly stated, but minimum necessary rule applies to disclosures	Required—only collect data necessary for purpose
Data transfer restrictions	No specific cross-border rules (U.S. only)	Restrictions on transfer outside EU/EEA unless adequate safeguards exist
Security requirements	Requires physical, technical, and administrative safeguards	Requires “appropriate” technical and organizational measures
Retention policy	No specific limits, but must retain records for 6 years (under Privacy Rule)	Must not retain personal data longer than necessary
Focus area	Health data privacy and security	General data privacy across industries

What are the similarities between HIPAA and GDPR?

Despite the difference between GDPR and HIPAA, they share some core principles:

• Data protection focus: Both aim to protect sensitive information.
• Security requirements: Encryption, access control, and auditing are expected.
• Breach reporting: Both require timely breach notifications.
• Accountability: Organizations must demonstrate compliance.
• Third-party oversight: Vendors and partners must also follow the rules.

Best practices for HIPAA and GDPR compliance

1. Understand the regulations: Start by knowing what applies to you. Assign compliance officers or consultants to map regulatory boundaries. Don’t guess. Get it right from the start.
2. Appoint a Data Protection Officer (DPO): GDPR mandates a DPO for most organizations. HIPAA doesn’t, but appointing a privacy officer helps streamline both.
3. Conduct risk assessments: Run regular risk assessments to identify vulnerabilities. Document findings. Patch weaknesses fast. Both regulations expect proactive risk management.
4. Data classification & mapping: Know what data you collect, where it flows, and who accesses it. Classify data into categories—personal, sensitive, financial, health, etc.
5. Privacy notices: Use clear, user-friendly privacy policies. GDPR requires detailed notices about how personal data is used. HIPAA also needs notices of privacy practices (NPPs).
6. Encryption & security measures: Encrypt all sensitive data, whether it’s at rest or in transit. Enforce MFA. Monitor access logs. The more layers you add, the better your defense.
7. Response plan: Prepare for breaches. Have a clear, documented response plan. Assign roles. Test it. Update it after each incident.
8. Documentation: Both laws demand evidence. Document policies, procedures, training, and breach logs. Store them securely and keep them updated.

How Scalefusion Veltar helps in HIPAA and GDPR compliance

Compliance management is all about building trust through disciplined data handling. It ensures strong data governance, restricted access, encryption, and more to meet regulations like HIPAA and GDPR. But keeping up with these requirements while managing day-to-day business operations can be overwhelming.

So, how do you solve this? Automation is the answer. Just like the internet revolutionized how we work and communicate, automation is transforming compliance management.

Scalefusion Veltar makes compliance automation effortless. It supports key frameworks with continuous monitoring, automated reports, and real-time alerts, ensuring policy adherence and audit readiness across your infrastructure.

Here’s how Veltar strengthens compliance:

• Device enforcement: Only secure, approved devices can access sensitive data.
• Compliance Monitoring & Remediation: Continuously track device posture and user behavior. Instantly flag violations and auto-remediate before they escalate.
• Access controls: Restrict access to authorized users and roles.
• Audit-ready logs: Track activity, device health, and access reports.

With centralized visibility and intelligent automation, Veltar empowers enterprises to stay compliant without slowing down operations.

Final takeaway

GDPR vs HIPAA isn’t about choosing one. But it’s about knowing how both impact your business. If you handle sensitive healthcare or personal data, you need to take both seriously. From risk assessments to secure access, aligning with best practices is no longer optional.

With solutions like Scalefusion Veltar, enterprises can simplify compliance and build trust, without losing efficiency or control.

FAQs

1. What is the HIPAA privacy rule? 

The HIPAA Privacy Rule sets national standards in the US to protect individuals’ medical records and personal health information. It controls how healthcare providers, insurers, and their business associates use and share patient data to ensure privacy and security.

2. Is HIPAA only in the US?

Yes, HIPAA is a US-specific law focused on healthcare data privacy and security within the United States. Unlike GDPR, which applies across the EU, HIPAA governs US healthcare entities and their handling of protected health information (PHI).

3. Is GDPR legal or regulatory? 

GDPR (General Data Protection Regulation) is a legal regulation enacted by the European Union. It governs data protection and privacy for all individuals within the EU and applies to organizations worldwide that process EU residents’ data.

4. What is the US equivalent of the GDPR? 

There isn’t a direct US equivalent to GDPR, but HIPAA is often compared to GDPR in terms of healthcare data protection. The key difference between GDPR and HIPAA is that GDPR covers all personal data, while HIPAA specifically protects health information in the US.

5. Does GDPR still exist?

GDPR is fully active and remains the main data privacy law in the European Union since its enforcement in May 2018. It sets a global standard for personal data protection and is regularly updated to address new technology. Organizations worldwide must comply if they handle EU residents’ data. Understanding the difference between GDPR compliance vs HIPAA is essential for any business working internationally or with healthcare information.