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A Business Associate Agreement (BAA) is a mandatory requirement under HIPAA legislation aimed at protecting patient health information. It establishes a formal relationship between a business associate and a covered entity, or between a covered entity's business associate and its subcontractor, creating shared responsibilities and liability. The BAA details how health information is used, maintained, or transmitted between parties. It serves as a binding contract between entities, such as a medical group and a third party, like an IT hosting partner. The agreement includes guarantees related to service level agreements, incident response times, disaster recovery expectations, and outlines permitted uses and disclosures of protected health information (PHI).