health-care

HIPAA vs. HL7: Key Differences That Shape the Future of Healthcare App Development

Diksha Sharma

— 5 min read
HIPAA vs. HL7: Key Differences That Shape the Future of Healthcare App Development

The current environment of healthcare technology feels more dynamic and unpredictable than ever. Think of it as a big-picture view: regulations are shifting, patient expectations are rising, and developers face constant pressure to deliver apps that are both secure and seamless.  A recent Deloitte survey of healthcare finance leaders highlights just how high the stakes are: 84% reported concerns about business conditions from regulatory changes, macroeconomic shifts, and supply chain disruptions, while 73% cited worries over revenue growth and operating profitability. What once seemed like a clear roadmap now resembles a constantly shifting landscape, where every choice carries weight and uncertainty.

Amid this change, two names keep surfacing: HIPAA and HL7. At first glance, they may sound like just more industry jargon. But together, they set the boundaries and build the bridges of modern healthcare apps. HIPAA protects trust by safeguarding patient privacy, while HL7 enables connection by making sure data speaks the same language across systems.  And to better recognise the role of interoperability in digital health, the World Health Organisation (WHO) has signed a project collaboration with HL7  to promote the global adoption of interoperability standards, enabling the seamless flow of patient information across providers and care networks.

Think of this piece as your compass that breaks down the core differences between HIPAA and HL7, why they matter, and how understanding them can help developers not just meet today’s requirements, but anticipate tomorrow’s healthcare landscape.

HIPAA’s Role in Making Healthcare Secure and Reliable

Source: The HIPAA Journal 

Before HIPAA, securing and maintaining health insurance in the U.S. was complicated. Depending on your plan, you were at the mercy of a tangle of state and federal rules. Commercial group plans were subject to state laws, whereas employer-sponsored and individual coverage adhered to federal acts, including ERISA (1974) and COBRA (1985). For many, this meant coverage could disappear at the worst possible moment.

Enter HIPAA in 1996 as a way to protect people switching jobs or with pre-existing conditions quickly became much more. Beyond maintaining coverage, HIPAA aimed to clean up a messy system, curb fraud, and establish consistent safeguards for patient information.

In response, the Department of Health and Human Services created standards to safeguard patient information and make healthcare more reliable. These rules helped ensure that medical records stayed private and secure, giving people real confidence in the system. Moreover, HIPAA fixed gaps in insurance policies and brought order to a fragmented system that set the stage for the digital health innovations we see today.

Over time, HIPAA introduced two critical safeguards: the HIPAA Privacy Rule, which gives individuals greater control over their health information and sets boundaries for its use and disclosure, and the HIPAA Security Rule, which establishes technical safeguards to protect electronic health information. Together, these rules ensure that patient data remains secure, private, and in the right hands, while also enabling healthcare organisations to operate more efficiently.

HIPAA at a Glance

Source: The HIPAA Journal

HL7’s Role in Enabling Seamless Data Exchange

HL7 (Health Level Seven International) ensures healthcare systems can share information smoothly and reliably. By providing a standard framework for exchanging, integrating, and retrieving electronic health data, HL7 ensures interoperability, making sure that even different systems can communicate effectively. 

HL7 encompasses several key standards:

While HIPAA protects patient privacy, HL7 keeps the data flowing securely, helping digital health solutions stay ethical, safe, and dependable.

The reach of HL7 standards extends far beyond theory, and it’s shaping how healthcare operates on the ground. Globally, the World Health Organisation (WHO) has teamed up with HL7 to push open interoperability standards, ensuring that a patient’s record from a primary care clinic can follow them seamlessly to a specialist, strengthening continuity of care across the system.

In the U.S., adoption is even more visible. More than 80% of Health Information Organisations (HIOs) routinely exchange HL7 Version 2 messages, making it the backbone of clinical and administrative data sharing nationwide.

Benefits of HL7 in Healthcare App Development

Supporting Data on the Healthcare Data Integration Landscape

According to Grand View Research, the healthcare data integration market was valued at $1.05 billion in 2022 and is projected to reach $3.11 billion by 2030, growing at 14.5%in the forecast period of 2023 to 2030. These numbers highlight the push toward smoother and smarter patient data sharing.

The global market for interoperability solutions was estimated at USD 3,418.3 million in 2023 and expected to grow to USD 8,567.9 million by 2030, growing at a CAGR of 14% from 2024 to 2030. And that growth underscores the rising role of HL7 in powering real-time data exchange.

In July 2023, WHO and Health Level Seven International (HL7) signed a Project Collaboration Agreement to push the global adoption of FHIR standards, with a vision to make health data exchange seamless across the globe.

HIPAA vs. HL7: Why It Matters for App Development

Healthcare has made impressive strides, but achieving true interoperability is still a work in progress. EHRs (electronic health records) were designed as independent, siloed systems, and now they’re being asked to communicate seamlessly for the benefit of the patient. This gap between intention and reality makes understanding HIPAA and HL7 crucial for app developers.

HIPAA (Health Insurance Portability and Accountability Act) addresses one side of the equation: security and compliance. It sets national standards for protecting patient data, controlling access, and ensuring safe data exchange. Any healthcare app handling medical records, claims, or patient communications must comply with HIPAA to avoid legal risks and build user trust.

HL7 (Health Level Seven) tackles the other side: Interoperability. Standards like FHIR (Fast Healthcare Interoperability Resources) have created a shared language that enables hospitals, labs, insurers, and apps to exchange information efficiently. Without HL7, even HIPAA-compliant apps may struggle to integrate with other systems and leaving data trapped in silos. For developers, the takeaway is clear: HIPAA protects the patient, HL7 connects the systems, and successful healthcare apps require both. Ignoring one risks either legal trouble or poor usability, while embracing both ensures apps that are secure, integrated, and genuinely useful.

Conclusion

As we step into 2024, healthcare app development is being defined by how well systems can connect and communicate with providers and patients. HIPAA has laid the foundation by ensuring patient data is secure and trusted at every step. On the other hand, HL7 builds on a foundation that enables information to flow smoothly between hospitals, labs, insurers, and apps, breaking down the silos that often slow progress. Together, these standards are shaping a healthcare ecosystem that is both efficient and patient-centric. As a trusted leader in healthcare software development, we ensure strict adherence to HIPAA and HL7 standards, building scalable applications that turn interoperability into a real advantage for better patient care.

Read more