Why Healthcare Is Treated as a Special Category Under the DPDP Act

India’s DPDP Act introduces a modern privacy framework for an era where personal data has become as powerful as currency. Yet no other domain carries the same depth of sensitivity, risk and ethical responsibility as healthcare. Medical information is not simply a digital record. It is a lifelong story of a person’s body, mind, vulnerabilities and identity. A single breach can cause permanent damage, and the consequences often extend far beyond the individual to families, employers, insurers and even entire communities.

This is why healthcare is treated as a special category under the DPDP Act. The law recognises that medical data is uniquely exposed, uniquely valuable and uniquely dangerous when mishandled. It rests on top of an already dense network of medical ethics, statutory duties and sectoral regulations, making healthcare the most complex environment for DPDP implementation.

The nature of healthcare data

Sensitive personal data in its purest form

Health information belongs to the highest sensitivity class recognized globally. A medical record contains diagnosis details, genetic markers, mental health notes, disability profiles, treatment histories, substance dependence patterns and sexual health information. Each of these carries deep personal, social, professional and financial ramifications. The sensitivity is not abstract. It is direct, human and permanent.

Lifelong impact of clinical data

Unlike other categories of personal data, a health record cannot be reset or changed. A chronic illness, a psychiatric diagnosis or a genetic predisposition follows the individual for life. If leaked, this data can lead to insurance discrimination, social stigma, targeted fraud, job loss or digital impersonation for decades.

Interconnected longitudinal records

Modern clinical records are longitudinal. A person’s data stretches across childhood vaccines, adult chronic care, pregnancies, surgeries and geriatric support. Once this chain is exposed, the individual loses control over large parts of their biography.

Why DPDP imposes higher duties on healthcare

Purpose limitation in clinical workflows

Every data point in healthcare must be tied to a lawful and clinically justified purpose. A routine hospital visit touches registration desks, OPD, diagnostics, pharmacy, billing, telemedicine and sometimes insurance. Each step creates new data and triggers fresh compliance obligations. DPDP requires healthcare entities to define, restrict and document every such purpose.

Lawful processing across a complex ecosystem

Healthcare rarely processes data in a single entity. Typical processing includes hospitals, labs, pharmacies, insurers, TPAs, digital health apps, cloud vendors and national registries under ABDM. Each participant becomes a data fiduciary or processor with independent obligations. The complexity of ensuring lawful processing across this chain is far greater than in typical industries.

Stronger consent governance

Healthcare data cannot rely on broad or bundled consent. DPDP requires explicit, informed and purpose specific consent for consultations, tests, imaging, telemedicine, data sharing with insurers, digital health platforms and any secondary use for research or analytics. Withdrawal must also be supported through verifiable trails.

Data flows that make healthcare unique

Continuous flows into biomedical research

India’s research ecosystem depends on steady clinical datasets feeding clinical trials, observational studies, registries and AI training pipelines. The ICMR 2023 Ethical Guidelines require consent, ethics review, deidentification and risk assessments. DPDP adds statutory force to these obligations and prohibits any processing beyond the approved scope.

Digital health platforms and consumer health apps

The growth of telemedicine apps, fitness trackers, menstruation apps, AI symptom checkers and wearable devices has expanded the healthcare data universe far beyond hospitals. Many of these platforms collect behavioural and lifestyle data that is inferential and highly sensitive. DPDP directly applies to these entities and demands strong minimisation and privacy by design.

The insurance and claims ecosystem

Health insurance involves a large data exchange between insurers, TPAs, hospitals, surveyors and occasionally reinsurers. Medical records, diagnostic reports, prescriptions and histories move through multiple hands. DPDP’s rules on access control, data sharing and consent significantly tighten obligations for all these entities.

Hospitals as fragmented digital ecosystems

A modern hospital does not run on a single system. EHR, HIS, PACS, RIS, LIS, pharmacy software, billing engines and outsourced IT vendors operate simultaneously. Each system introduces new vulnerabilities. DPDP requires synchronised access control, role based permissions, audit trails, retention controls and breach response readiness across this entire ecosystem.

Public health and population scale data

Balancing individual rights with collective health

India’s public health programmes depend on disease surveillance, outbreak reporting, vaccination drives, maternal and child monitoring and epidemiological datasets. DPDP recognises this requirement and allows specific exceptions for public health interests. However, it also demands proportionality, oversight and safeguards to ensure that emergency exceptions do not become normalised misuse.

The national digital health ecosystem

ABHA numbers, the Health Facility Registry, the Health Professional Registry and digital health exchanges create a unified national health data grid. While this enables continuity of care, it also greatly increases the stakes for data breaches. DPDP compels entities participating in ABDM to implement secure data exchange, authentication, traceability and consent artefact compliance.

Exceptions and special provisions relevant to healthcare

Emergency exceptions

Lifesaving care, accident trauma, unconscious patients or situations where immediate action is required allow processing without consent. These exceptions must be used only when necessary and documented carefully.

Public health exemptions

Certain statutory reporting and government directed programmes allow processing without individual consent. This includes outbreak management, notifiable diseases and vaccination programmes. Entities must still apply safety and purpose limitation controls.

Secondary use for research

DPDP allows exemptions when data is anonymised and used exclusively for genuine scientific or historical research. All secondary use requires ethics committee oversight, strict deidentification and compliance with ICMR guidelines.

Unique risks that justify special treatment

AI driven diagnostics and decision support

AI based radiology, pathology and triage tools carry risk of data drift, algorithmic bias, unexplained outputs and uncontrolled secondary use of datasets. DPDP demands accountability and transparency in these systems.

Profiling and targeted misuse

Health data is extremely valuable for advertisers, insurers, employers and political entities. In the wrong hands, it becomes a tool for exclusion or discrimination.

Medical identity theft

Fraudsters use stolen medical records to claim false insurance, purchase drugs, or impersonate patients. Because medical data is permanent, these attacks are extremely difficult to rectify.

Social and personal harm

Disclosures related to mental health, sexual health, HIV status or genetic conditions carry serious social consequences. The law treats these categories with additional caution.

Why healthcare must act faster than any other sector

When GDPR came into effect in Europe, healthcare faced some of the highest penalties. Hospitals, research institutions and insurers were fined heavily due to poor preparation and inadequate controls. Even with a two year readiness period, the sector struggled. India’s timeline is even shorter at eighteen months. This creates an urgent need for hospitals, biotech companies, healthtech platforms and insurers to start compliance immediately.

Healthcare stands apart because the data it handles is deeply personal, lifelong and impossible to replace once compromised. The DPDP Act acknowledges this reality by imposing stricter duties, tighter controls and stronger protections. For healthcare organisations, complying with DPDP is not merely a regulatory exercise. It is a fundamental responsibility to patients, to ethics and to public trust.

Why Author Sujeet Katiyar is the best consultant for DPDP Act and healthcare compliance

With twenty-seven years of experience in healthcare technology, compliance and regulatory frameworks, Sujeet Katiyar understands how clinical workflows, digital systems and legal obligations intersect. His expertise enables hospitals, diagnostic chains, insurers, TPAs, biotech firms and healthtech innovators to translate DPDP obligations into practical, implementable solutions. Organisations looking for complete DPDP preparedness, risk mitigation and governance clarity will find in him a trusted advisor equipped to guide complex healthcare environments end to end. Let your organisation build DPDP strength with a consultant who truly understands healthcare at its core.