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A Business Associate Agreement (BAA) is a mandatory requirement under HIPAA legislation aimed at protecting protected health information (PHI). It establishes a relationship between a business associate and a covered entity, or between the covered entity's business associate and its subcontractor, forming a chain of shared responsibilities and liability among parties. The BAA details how health information is used, maintained, or transmitted, serving as a binding agreement between a covered entity, such as a medical group, and third parties, like IT hosting partners. It includes guarantees on service levels, incident response times, disaster recovery expectations, and explicitly outlines the permitted uses and disclosures of PHI.