HIPAA-Compliant File Transfer: SFTP/FTPS, Encryption, BAAs, and Audit Logs — A Practical Guide

SFTP and FTPS Protocols

What they are and how they differ

SFTP (SSH File Transfer Protocol) runs over the SSH transport and secures a single, firewall-friendly port. FTPS adds TLS to the traditional FTP protocol and can operate in explicit or implicit modes. Both encrypt data in transit and can help you protect electronic Protected Health Information (ePHI) when implemented correctly.

Strengths and trade-offs

• SFTP: Simple port management, mature key-based authentication, and broad automation support. Some legacy clients may not support it by default.
• FTPS: Familiar to teams that already use FTP; integrates with existing TLS PKI. Passive mode can complicate firewall rules due to dynamic data ports.

Security features to enable

• Strong identity: SSH keys (Ed25519 or RSA-3072+) for SFTP; TLS certificates with modern curves/keys for FTPS.
• Modern crypto: Prefer AES-GCM or ChaCha20-Poly1305; disable legacy ciphers and MACs.
• Access control policies: Enforce least privilege using chroot/jails, role-based permissions, and restricted command sets.
• Multi-factor authentication: Combine public keys or passwords with a second factor for administrative and high-risk workflows.

Choosing the right protocol

Select SFTP for simpler firewalling and Linux-native automation. Choose FTPS when enterprise PKI and legacy tooling are requirements. You can support both, but apply identical technical safeguards and monitoring across them.

Encryption Standards for ePHI

Data in transit

Use TLS 1.2+ (ideally TLS 1.3) for FTPS and hardened SSH for SFTP. Enable forward secrecy (ECDHE/curve25519), authenticate servers and clients, and pin or validate certificates to prevent man-in-the-middle attacks.

Data at rest

Encrypt ePHI on servers and storage with AES-256 or another NIST-recommended algorithm. Manage keys in a dedicated KMS or HSM, enforce rotation, and separate duties so administrators cannot unilaterally decrypt data.

End-to-end encryption considerations

Transport encryption protects data in motion. If you need end-to-end encryption, add client-side file encryption before upload so only intended recipients with the decryption keys can open the files, even if storage is compromised.

Integrity and authenticity

Use AEAD ciphers (GCM/Poly1305) or HMACs to verify file integrity. For high assurance, sign packages or manifests and validate signatures on receipt to detect tampering.

Business Associate Agreements (BAAs)

When a BAA is required

If a vendor, service, or managed file transfer provider creates, receives, maintains, or transmits ePHI on your behalf, you need a Business Associate Agreement. This formalizes each party’s responsibilities for protecting ePHI.

Key BAA elements for file transfer

• Permitted uses and disclosures of ePHI specific to file exchange.
• Security obligations: technical safeguards, administrative safeguards, and physical safeguards expected of the vendor.
• Breach and incident handling: notification triggers, timelines, and cooperation duties.
• Subcontractors: flow-down requirements to any downstream providers.
• Termination: return or secure destruction of ePHI and proof of completion.

Shared responsibility in practice

A BAA does not replace your own security program. You still define access control policies, classify data, train users, and validate the vendor’s controls through due diligence and ongoing monitoring.

Audit Log Management

What to log

• Authentication events: successes, failures, MFA status.
• File operations: uploads, downloads, renames, deletions, permissions changes.
• Administrative actions: user provisioning, key/certificate updates, policy changes.
• Network and system events: configuration edits, service restarts, and anomalies.

Retention, integrity, and review

Store logs centrally, protect them with write-once or tamper-evident controls, and time-sync systems via NTP. Retain logs per policy and legal requirements; many organizations choose six years to align with documentation retention. Review routinely and integrate alerts with a SIEM for real-time detection.

Privacy-aware logging

Avoid logging ePHI content itself. Capture metadata (who, what, when, where) while masking identifiers when not necessary for security or compliance investigations.

HIPAA-Compliant File Transfer Solutions

Solution types

• Managed File Transfer (MFT) platforms with SFTP/FTPS, centralized policy, and orchestration.
• SFTP/FTPS gateways or jump hosts that isolate internal storage from the internet.
• Cloud-hosted services that provide encryption, MFA, and BAAs for ePHI workflows.

Capability checklist

• Encryption in transit and at rest, with FIPS-validated modules where feasible.
• Strong identity: SSO, multi-factor authentication, and role-based authorization.
• Granular access control policies, IP allowlists, and just-in-time access.
• Detailed, immutable audit logs with easy export to your SIEM.
• Automated key and certificate management, rotation, and revocation.
• High availability, backups, data residency options, and tested disaster recovery.
• Vendor BAA, security documentation, and third-party assessments.

Operational fit

Match the tool to your workflows: interactive clinician access, batch integrations with EHRs, or partner file exchanges. Favor solutions that align with your existing identity provider and change-management processes.

Configuring Secure File Transfers

Server hardening

• Place servers in a dedicated network segment behind a firewall; expose only required ports.
• Disable legacy protocols and ciphers; enforce modern KEX, MACs, and ciphers.
• Use chroot/jails and per-user directories to prevent lateral movement.
• Require key-based auth for SFTP and strong TLS certificates for FTPS; add MFA for admins.
• Automate patching and configuration management; monitor file integrity.

Client and automation setup

• Validate host keys and certificates; pin when possible to prevent spoofing.
• Use non-interactive, rotated credentials for jobs; avoid hardcoding secrets.
• Employ checksum or signature verification after transfer; retry safely on failure.
• Encrypt sensitive files before transfer if you require end-to-end encryption.

Data handling and lifecycle

• Classify data and tag ePHI; apply least-privilege permissions and time-bound access.
• Set retention and secure deletion schedules; back up encrypted data with tested restores.
• Document procedures as administrative safeguards and train users on secure handling.

Validation and testing

• Run security baselines and protocol scans to confirm cipher and version posture.
• Conduct access reviews and role recertifications regularly.
• Test incident response with simulated credential loss, misdelivery, and malware events.

File Transfer Security Requirements

Baseline must-haves

• SFTP or FTPS with hardened configurations and current protocol versions.
• Encryption in transit and at rest; client-side encryption when end-to-end confidentiality is required.
• Strong identity, multi-factor authentication, and documented access control policies.
• Comprehensive, tamper-evident audit logs integrated with centralized monitoring.
• Key and certificate lifecycle management with rotation and revocation.
• Documented procedures, training, and vendor BAAs covering ePHI handling.
• Physical safeguards for hosting environments and secure device management.

Mapping to HIPAA safeguards

• Technical safeguards: encryption, authentication, authorization, integrity controls, and audit logging.
• Administrative safeguards: policies, risk analysis, workforce training, and vendor management with BAAs.
• Physical safeguards: secure facilities, device/media controls, and resilient infrastructure.

Conclusion

HIPAA-compliant file transfer combines secure protocols, strong encryption, enforceable BAAs, and rigorous audit logging, all governed by clear policies and ongoing oversight. By aligning technology with technical, administrative, and physical safeguards, you create a defensible, practical program for exchanging ePHI safely.

FAQs.

What protocols ensure HIPAA-compliant file transfer?

HIPAA does not mandate specific protocols, but SFTP and FTPS are widely used because they encrypt data in transit and support strong authentication and auditing. The protocol alone is not enough—pair it with hardened configurations, MFA, access controls, and monitoring.

How do Business Associate Agreements affect file transfer compliance?

A BAA defines how a vendor must protect ePHI during transfer and storage. It clarifies permitted uses, security expectations, subcontractor obligations, and breach notification duties, ensuring both parties share responsibility for safeguarding data.

What encryption standards are required for HIPAA file transfers?

HIPAA is risk-based and expects “reasonable and appropriate” protection. Use modern standards: TLS 1.2+ (preferably 1.3) for FTPS, hardened SSH for SFTP, and AES-256 or comparable algorithms for data at rest. When feasible, choose FIPS-validated cryptography and add client-side encryption for end-to-end confidentiality.

How important are audit logs in HIPAA file transfer compliance?

Audit logs are essential. They prove who accessed what, when, and from where; support incident response; and demonstrate adherence to policies. Protect logs from tampering, retain them per policy, and review them routinely with automated alerts for suspicious activity.