Is OneDrive HIPAA Compliant?

✨Is OneDrive HIPAA Compliant?

When it comes to managing protected health information within the digital realm, HIPAA compliance is a fundamental requirement for healthcare organizations. 

OneDrive is a popular cloud-based file hosting service owned by Microsoft. As standard, OneDrive does not meet HIPAA regulations for the safeguarding of PHI. 

However, OneDrive settings can be configured to be HIPAA compliant. Microsoft and OneDrive offer various features designed to protect sensitive data and ensure privacy, including access controls and cyber security auditing.

Will Microsoft Sign a BAA for OneDrive?

To comply with HIPAA, business associates must have a Business Associate Agreement in place with all organizations that are classified as HIPAA-covered entities.

Yes — Microsoft is willing to sign a BAA with healthcare organizations that covers the use of OneDrive.

However, simply signing the BAA does not ensure compliance. Healthcare organizations must also ensure their use of OneDrive remains compliant. 

To remain compliant with HIPAA standards, healthcare organizations must configure OneDrive’s settings, such as applying strict sharing permissions and access controls. Any employees or staff must also be properly trained on data security and handling sensitive data to prevent data leaks.

Can You Store PHI or Patient Data in OneDrive?

Yes —it is possible to store PHI in OneDrive, however it can still present certain risks. 

As mentioned, healthcare organizations planning on using OneDrive to handle and store PHI must configure OneDrives settings to do so compliantly. This includes enabling protections against unauthorized access and other data leaks. 

Furthermore, healthcare organizations must be on a OneDrive Enterprise plan and have signed a BAA with Microsoft. Without meeting these requirements and specific settings configurations, you risk non-compliance with HIPAA and open yourself up to significant regulatory and litigation risks.

✨Can PHI or Patient Data be Leaked from OneDrive?

Considering OneDrive’s use as a file storage service that also enables easy file sharing, there is always a risk of data leaks unless additional security mechanisms are implemented.

OneDrive is not immune to potential data breaches or leaks. Although Microsoft offers various security measures to ensure data security on One Drive, vulnerabilities remain. The risk of leaks of PHI can stem from various sources, including incorrectly configured access controls, accidental sharing and human error and even malicious internal threats.

Your employees and staff also play a daily role in ensuring data security and privacy when handling sensitive patient data —training staff on cybersecurity best practices adds to the complexity.

The persistent threat of data leaks leads many healthcare organizations to adopt additional security mechanisms that not only ensure compliance, but effectively prevent data leaks.

✨How Can Strac Prevent Data Leaks from OneDrive?

Strac OneDrive DLP is a comprehensive data leak prevention tool that adds an additional layer of security to OneDrive. 

Strac OneDrive DLP ensures your use of OneDrive remains compliant, efficient and secure at all times. Here's how:

• Customizable Detectors: Strac provides detection capabilities for sensitive data related to PCI, HIPAA, GDPR, and other sensitive information. Strac enables both detection and redaction of sensitive content in images and performs thorough content inspections in various document formats, spreadsheets and zip files.
• Seamless Integration: Customers can quickly integrate Strac and begin benefiting from DLP, real-time scanning, and redaction in their SaaS applications. See Strac’s full catalog of sensitive data elements.
• Accurate Detection & Redaction: Strac's custom machine learning models trained on sensitive PII, PHI, PCI, and confidential data provide high accuracy and low false positives and false negatives.
• Extensive SaaS Integrations: Strac has the widest and deepest number of SaaS and Cloud integrations. Visit our complete range of DLP integrations.
• AI Integration: Beyond standard SaaS, Cloud, and Endpoint protections, Strac seamlessly works with LLM APIs and AI platforms such as ChatGPT, Google Bard, and Microsoft Copilot, enhancing the security of AI or LLM applications and the data they process. Learn more through Strac's developer documentation.
• Endpoint DLP: Offering a unique solution, Strac provides accurate and comprehensive DLP protection not just for SaaS and Cloud environments but also across endpoint devices. Learn more about our Endpoint DLP.
• Adaptable Configurations: With ready-made Compliance templates and the ability to detect and redact sensitive data elements, Strac also offers customizable settings to address specific organizational requirements, ensuring data protection measures are tailored to your organization’s individual needs.

Learn more about how Strac adds an extra layer of security and helps organizations comply with HIPAA and other data security regulations with our guide to HIPAA Compliance. 

Book a free 30-minute demo to learn more.

Bottom Line: Is OneDrive HIPAA Compliant?

When determining whether OneDrive is HIPAA compliant, it’s crucial to know that compliance is not guaranteed out of the box. Microsoft OneDrive is HIPAA compliant only when configured with the right security controls, backed by a signed Business Associate Agreement, and monitored continuously. Many healthcare teams assume OneDrive is HIPAA compliant by default, but the reality is that it requires intentional configuration, visibility, and data protection to stay within regulatory limits.

Here’s how organizations can ensure compliance and avoid HIPAA violations:

• Enable encryption at rest and in transit to protect PHI from unauthorized access.
• Configure granular access controls and limit sharing outside the organization.
• Apply DLP and monitoring policies to detect and remediate sensitive data exposure.
• Regularly audit settings to maintain compliance posture across users and files.

With these safeguards in place, and with Strac’s OneDrive DLP integration automating PHI discovery, redaction, and policy enforcement, organizations can confidently maintain HIPAA compliance while enabling secure collaboration across teams.

🌶️Spicy FAQs on OneDrive HIPAA Compliance

Is Microsoft OneDrive fully HIPAA compliant in 2025?

OneDrive is HIPAA compliant only when used under a signed Business Associate Agreement and configured with HIPAA-aligned security policies. Healthcare organizations must enable encryption in transit and at rest, use identity access management (IAM), and ensure proper data retention rules.

Key HIPAA-aligned measures include:

• Enabling MFA and conditional access policies
• Configuring audit logs for data access
• Using DLP policies to monitor and restrict PHI sharing

With these safeguards and a BAA, OneDrive meets HIPAA standards for secure PHI storage and sharing.

Does Microsoft sign a Business Associate Agreement (BAA) for OneDrive?

Yes. Microsoft offers a BAA for all covered entities using OneDrive under Microsoft 365. However, signing a BAA does not automatically make an organization compliant — it simply allows Microsoft to process PHI on your behalf under HIPAA terms.

To maintain compliance:

• Review Microsoft’s standard BAA carefully
• Limit PHI storage to HIPAA-covered OneDrive environments
• Implement DLP and access control for continuous protection

A signed BAA + proper data governance = true OneDrive HIPAA compliance.

Can healthcare organizations store PHI or patient data in OneDrive safely?

Healthcare organizations can safely store PHI in OneDrive if they have signed a BAA and configured HIPAA-compliant security settings. Encryption, access control, and DLP policies are essential to prevent unauthorized access.

Strac strengthens OneDrive security by automatically detecting, classifying, and redacting PHI in shared folders or files. This ensures HIPAA compliance even in real-time collaboration environments.

What are the risks of storing PHI in OneDrive without a BAA?

Storing PHI in OneDrive without a BAA violates HIPAA regulations and exposes organizations to compliance fines and potential breaches. Unauthorized access or misconfigured permissions can easily expose sensitive medical records.

Common risks include:

• PHI exposure through public or external file sharing
• Lack of breach notification protocols
• Non-compliant data backups

Without a BAA, your organization remains fully liable for any HIPAA violation that occurs in OneDrive.

How can misconfigured OneDrive settings lead to HIPAA violations?

Even with a BAA, OneDrive HIPAA compliance can fail due to misconfiguration. Improperly shared folders, public links, or lack of data monitoring can all result in unintentional PHI exposure.

To prevent violations:

• Regularly audit OneDrive sharing settings
• Use Strac’s OneDrive DLP integration to detect and remediate exposed PHI automatically
• Apply least-privilege access and continuous monitoring

A well-configured OneDrive with Strac’s automated safeguards ensures compliance stays intact from upload to sharing.