Define a "covered entity" under HIPAA.

A "covered entity" under HIPAA is best described as any organization that transmits health information in electronic form in connection with a HIPAA transaction. This definition encompasses a variety of organizations within the healthcare industry, including healthcare providers who send electronic claims and billing information, as well as health plans and healthcare clearinghouses.

The significance of this definition lies in its focus on the electronic transmission of health information, which is a key component of HIPAA regulations aimed at safeguarding patient information while ensuring effective communication within healthcare systems. By identifying entities that handle sensitive health data electronically, HIPAA ensures that these organizations comply with specific privacy and security standards to protect patient information.