SAP S/4HANA Cloud: Keeping your Data Safe and your HLS Business Compliant

Published: March 18, 2022

Over 40 million patient records were compromised in 20211, states a Healthcare IT News report. These were the sum of the impact of the 10 largest breaches reported to the Office of Civil Rights during the year. The targeted institutions ranged from children’s hospitals, eye care clinics to grocery chains that held pharmacy records.

Sensitive information such as patient health records, SSNs, prescriptions, personally identifiable information (PII), addresses, and other confidential information when placed in the wrong hands, can put both the Healthcare provider and the patient at great risk.

The breaches reported were hacking incidents by unauthorized users who gained access to Electronic Health Records (EHR) by breaking existing security protocols. This brought to the fore the overarching importance of adequate data security in the Healthcare sector given its criticality and the sensitivity of the information it generates.

The Healthcare sector is one of the most regulated sectors in the US, covering both, information security and the entire lifecycle of operations, from procurement to distribution. While storage and administration of EHRs and data are governed by HIPAA (Health Insurance Portability and Accountability Act), the entire healthcare industry operations are subject to compliance with FDA regulations.

The SAP S/4HANA landscape supports the healthcare sector in ensuring compliance and abiding by the rules and regulations set by regulatory bodies.

Healthcare and HIPAA

The HIPAA Security Rule is a specific part of HIPAA and provides the below regulations for the security of electronically stored patient information.

  • Ensure Data integrity, accessibility, and confidentiality of all electronic health records
  • Identify and mitigate threats to the stored information
  • Protect against unauthorized usages and disclosures
  • Ensure complete compliance to security norms by the workforce

Healthcare regulatory compliance is critical, as the stakes involved are high. Even a small deviation can lead to fatal consequences, which is the reason for the focus on regulatory compliance. The major challenge that the Healthcare sector faces is to ensure the security and confidentiality of its data, whether stored on-premise or on the cloud.

The healthcare sector also needs a comprehensive ERP system that can cover the entire gamut of operations, enabling optimized systems and workflows compliant with regulatory norms and leading to better productivity and profitability.

The role of cloud-based solutions in the healthcare sector

The healthcare sector has seen a steady rise in the adoption of cloud-based storage and application environments as they seek greater digitization. This accords the opportunity to benefit from greater data security, as cloud solution providers offer a wide range of features to ensure data security and protection from unauthorized usage and malicious hacking attempts. Cloud-based solutions also offer remote access to data and applications, increasing productivity and connectivity. The security features offered by cloud-hosted solutions are outlined below.

  • Access restrictions
  • Password management
  • Firewalls
  • Data encryption
  • Virus protection
  • Retention and destruction of data
  • Faster incidence response and management
  • Risk identification and mitigation


SAP S/4HANA is a widely used cloud-based ERP solution and offers a range of constituent applications that cover major business functions, along with extensible modules for specific needs of diverse business verticals. For the healthcare sector, SAP offers products such as SAP Patient Management, Marketing Cloud, Qualtrics CE, Advanced Track and Trace for Pharmaceuticals, BO Enterprise, Analytics Cloud and many more, giving end-to-end solutions for the complete needs of the Healthcare sector.

The S/4HANA Cloud is the core of the entire SAP environment and stores the critical data used for the operational processes and analytics. It uses hyperscalar providers to offer it as an Infrastructure-as-a-service (IaaS). Outlined below are the major security aspects of S/4HANA Cloud and the distinct advantage they provide to the healthcare sector to ensure HIPAA compliance.

Data Security

Data Security is provided by customer data isolation with a virtual ABAP Server and database for each tenant. The “Security Group” provides the application isolation, which allows communication between different application instances belonging to the same tenant. This ensures that cross-tenant communication is prevented at the network level, which mitigates the risk of unauthorized tenant data access.

Data Encryption

SAP S/4HANA Cloud provides encryption for both data-at-rest and in-transit. Data-at-rest includes local and central file systems, backups, and database, whereas data-at-transit includes movement of data between applications and has end-to-end encryption. The key management system (KMS) manages the cryptographic keys with a ‘segregation of duties’ guideline. This gives complete encryption of data-both in the storage level and while being shared and prevents encrypted data from unauthorized access.

Application Security

Applications developed on the SAP S/4HANA cloud follow the secure software development lifecycle (SSDLC), with an extensive focus on data security, privacy, and protection. They undergo in-depth risk analysis, testing processes, and assessment of security controls to ensure complete security. All traffic to the applications is accessed through HTTPS, ensuring the secure movement of data.

Network Security

Network security in SAP S/4HANA Cloud is enabled by dividing the network into zones and segments, with security controls for each zone. These controls are based on the type of data and its interaction with a virtual backup cloud for data backups, admin, and internal systems.

Operational Security

The operational security team performs 24/7 monitoring of the database and infrastructure, securing administration access, taking backups, checking for vulnerabilities, simulating hackings, and mitigating risks. They also work on incident management and remediation, data breach notifications, and provide security patches and complete support to ensure that the data is secure for business continuity.

The above features of SAP S/4HANA Cloud make it a preferred choice for having a cloud-based ERP system for the healthcare sector, as it ensures that all the regulatory requirements of HIPAA are completely met. Having HIPAA compliance ensures that your healthcare business builds trust and value among your customers and gives you a competitive edge.

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