Compliance-Driven Hiring in US Health Tech: How to Build a Global Team Without Breaking the Rules
In healthcare, sensitive data is abundant—and so are the regulations governing its use. These regulations impose restrictions on where companies can locate their staff. To avoid legal risks, many organizations default to fully US-based hiring, as maintaining compliance with key requirements can feel overwhelming when managing a global team. The real challenge often lies not in drafting the necessary policies, but in ensuring they are consistently implemented and enforced.
Yet this approach is more limiting than it needs to be. Building a compliant, blended team takes effort, but the benefits are substantial. Hiring outside the US opens opportunities for 24/7 support coverage, access to global talent, and cost efficiencies. For example, at Kepler Team—which is a fractional digital product team in healthcare—we’ve seen how a globally distributed model can deliver these advantages without compromising on compliance. By carefully structuring our operations and controls, we’ve been able to offer geographically distributed team benefits while maintaining full regulatory alignment.
In this article, I’ll unpack the key regulations and highlight practical nuances in their application. The goal is to equip you with the knowledge needed to make informed hiring decisions and to confidently justify your team structure when clients have concerns about offshore operations.
Geography as a Compliance Factor in Healthcare IT
In healthcare IT operations, geography is far more than a logistical detail. Ensuring that team members are located in compliant jurisdictions and that appropriate protections are in place can be the difference between a successful healthcare project and one derailed by compliance failures, project delays, and legal problems.
The primary policies governing team member locations in healthcare stem from federal-level legislation, federal insurance policies and requirements for intellectual property protection, especially those concerning integrated third-party products.
These policies primarily guide you in establishing the correct protection measures and preventing incidents. The more diligently you adhere to them, the lower the risk of an incident. However, what also matters is your documented compliance should an incident occur.
When a sensitive data security incident happens, how much your company is held responsible by regulators or others largely depends on whether you had the required security practices in place before the incident. If you can prove your company followed the relevant rules, your liability will be much lower than if you can't. That's why it's so important to always keep your compliance records updated.
In this light, achieving geographical compliance takes the following steps:
Outline all relevant legislation that regulates your team's geographic location.
Design location-related policies and processes your company needs to maintain compliance.
Implement and operationalize these policies and procedures, consistently maintaining and updating proof of your compliance.
Now let's start with the legislation.
Federal Level Legislation
At the federal level, HIPAA remains the foundational framework, setting strict standards for protecting individually identifiable health information. HIPAA doesn't explicitly prohibit hiring personnel from abroad, but it demands stringent protections on Protected Health Information (PHI) and Personally Identifiable Information (PII), which is the core concern of healthcare data security and compliance. Having an employee outside the US means that some of the data crosses the national border, and you need to be sure that this is done in a compliant way.
Your company’s HIPAA compliance is important for your partners and clients, and their security relies on it. To demonstrate your HIPAA compliance, you can self-attest. To strengthen this claim, you can seek third-party validation or related certifications. As a lot of the HIPAA and SOC 2 attestation requirements coincide, a lot of the companies in the healthtech domain choose to demonstrate their security stance by obtaining both these attestations through a trusted vendor and/or auditor.
Kepler Essentials – Compliance Check-In
For early-stage teams in healthcare handling PHI or building HIPAA-sensitive tools
- • Review data flow and storage setup
- • Identify compliance needs (HIPAA, SOC 2, ONC)
- • Recommend simple compliance improvements
- • Clarify certification timing and resource planning
Being compliant with HIPAA means meeting its three main rules: the Privacy Rule, the Security Rule, and the Breach Notification Rule. Each of these outlines mandatory policies and procedures for protecting health information. These requirements extend across every dimension of operations, shaping internal processes, personnel training, and how technical infrastructure is secured and monitored.
Specifically, HIPAA rules:
Govern who is allowed to access PHI and under what circumstances.
Limit access to sensitive data based on an employee's role, necessity, and location.
Require administrative, technical, and physical safeguards to protect the confidentiality, integrity, and availability of electronic PHI (ePHI).
Define the procedures in case of a breach.
Returning to distributed teams, HIPAA doesn't ban international personnel. However, it does demand that PHI is protected under US standards, regardless of where an employee is based. An employee being overseas introduces additional risks and necessitates extra layers of protection and control beyond standard safeguards. Therefore, it is critical to ensure that all operations, regardless of location, are aligned with HIPAA’s data protection policies.
Federal Health Insurance Requirements Compliance
When engaging with federal health insurance programs like Medicaid and Medicare, you must adhere to their regulations for handling PHI and PII, both federal and state-specific.
Federal guidelines, such as those from the Centers for Medicare & Medicaid Services (CMS), permit offshore administrative or support functions under specific conditions. However, state laws introduce additional layers of complexity.
For example, Texas, New York, and Florida enforce rules that restrict or closely regulate the offshore processing and storage of Medicaid data, often requiring that all sensitive operations remain within U.S. borders (e.g., operations involving Medicaid MCO-related data or production environment data). Some states allow offshore operations but impose strict conditions. These typically include executing Business Associate Agreements (BAAs) with all vendors handling PHI and providing documented assurances of compliance with HIPAA security standards for encryption, access controls, audit logging, and workforce training.
Intellectual Property Protection
Intellectual property (IP) protection is another essential consideration when building distributed IT teams. If your project integrates with third-party components, you will also need to follow their requirements for IP protection. Many vendors are very serious about reducing the risks of misuse or exposure of their IP, and ignoring these requirements puts you at risk of losing access to their components.
In healthtech, a particularly challenging case involves the requirements of Electronic Health Record (EHR) platforms. Epic, for instance, sets an exceptionally high bar, while others, like Cerner or Athena, are also quite strict. They enforce rules for access to their proprietary tools, APIs, code, development environments, documentation, and integration layers. This includes restrictions on where your team members may be located to gain access to their systems; a wrong IP address from someone on your team could raise questions and suspend your access to the EHR.
However, protecting intellectual property extends beyond vendor obligations. Your own intellectual property, including architecture, codebase, and internal processes, should be carefully protected as well.
One factor influencing the security and defensibility of your intellectual assets is the strength of local IP laws. You may consult a target country’s Intellectual Property enforcement record to understand the risks. You may also use recognized international benchmarks, like the annual global rating published in the U.S. Chamber International IP Index. This index assesses legal protections for copyrights, trade secrets, effective systems for cross-border enforcement of intellectual property rights, and proven experience of collaboration with U.S. companies on IP enforcement and compliance. As of the 2025 rating, IP protection in countries scoring 68% or above is considered strong enough.
U.S. Chamber IP Index 2025, as of April 2025 (source)
Structuring Teams with a Compliance Map in Mind
As a rule of thumb, offshore teams can be compliantly leveraged for a wide range of non-sensitive functions. This includes development in sandbox environments, front-end engineering, UI/UX design, and QA testing—all areas where access to production data or real PHI is not required. Sensitive data and processes, however, should be reserved for domestic US-based teams.
Ensuring Compliance for an International Team
To ensure robust compliance, consider these detailed steps:
Establish Clear Data Access Controls: Implement role-based, minimal, and audited access to sensitive data and infrastructure. Utilize Identity and Access Management (IAM) tools to enforce these restrictions.
Execute Business Associate Agreements (BAAs): Any third-party vendors, contractors, or international employees who handle sensitive data must sign a BAA. This legally commits them to HIPAA and other relevant legislation, specifies their responsibilities to protect sensitive data, and provides you with legal protection in case of security incidents.
Train Staff on HIPAA and Other Location-Relevant Policies: Everyone who may handle sensitive data must understand applicable rules and the organization's privacy and security procedures.
Utilize Security Infrastructure Aligned with Requirements: This includes stored data encryption, VPNs, endpoint monitoring, breach detection tools, and similar measures.
Continuously Monitor and Document Compliance: For HIPAA compliance, platforms like SCRUT, Drata, or Vanta can automate monitoring, continuously collect audit-ready evidence, and ensure HIPAA policies are consistently enforced across teams. Compliance with other regulations should be maintained similarly.
Purchase Cyber Liability or Data Breach Insurance: This mitigates financial risk by covering breach response costs, legal fees, and regulatory penalties. Insurers often require strong security practices as a condition of coverage.
Blended Team Hiring vs. Blended Team Contractors
Beyond your in-house team, your compliance responsibilities extend to your contractors. It's crucial to understand the difference between directly hiring individual contractors and engaging with contracting companies.
When you hire a person as an independent contractor, it typically remains your responsibility to provide a security framework for them and to hold insurance that would protect your organization. In contrast, when you contract with a company, the market generally expects them to provide all necessary guarantees within the contract. This includes their own insurance, liability for their personnel that protects you in case of incidents, and, crucially, the implementation of required processes.
As a contractor company, we at Kepler Team specifically adapt our processes to compliantly extend our clients’ development teams. We sign all necessary Business Associate Agreements (BAAs) and tailor our team structure to each client project, depending on the specific regulations relevant in each case. All of this allows us to provide our clients with the benefits of a globally distributed team while remaining fully compliant with U.S. regulatory expectations.
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Learn moreConcluding Thoughts
Compliance misalignment can halt entire projects. However, by understanding staff location requirements in health tech, you can design a global team model that is secure, compliant, and cost-effective.
When building a global healthtech team with compliance in mind, keep these points in mind:
Blended team models balance compliance and flexibility. Assign PHI-handling or infrastructure-heavy roles to U.S.-based staff, while delegating non-sensitive functions like UI/UX, QA, or sandbox development to offshore teams in countries with strong Intellectual Property protections.
Main regulations in health tech affecting your hiring choices include federal laws like HIPAA, health insurance-related regulations, and third-party vendor policies (especially EHRs).
Intellectual property protection is as important as securing Protected Health Information and Personally Identifiable Information. When outsourcing, prioritize countries with strong intellectual property protection laws and use enforceable agreements to safeguard your own proprietary technology.
