Which of the following best defines "covered entities" under HIPAA?

The definition of "covered entities" under HIPAA primarily refers to organizations that transmit any health information in electronic form in connection with a HIPAA transaction. This includes health plans, health care clearinghouses, and health care providers who transmit health information electronically. Therefore, the option that defines covered entities most accurately highlights organizations that interact with personal health information. This encompasses hospitals, insurance companies, and medical billing firms, all of which are integral to the health care system's functioning.

The other options do not capture the regulatory scope of covered entities. Individuals providing health care services may be covered, but the term is broader and includes organizations. Service providers contracted with health facilities could also fall under this category, but only specific entities involved in certain transactions are included. Patients receiving health care, while central to the health care system, do not fit the definition of covered entities as they are not entities that handle health information in a transactional capacity according to HIPAA. Hence, the response focusing on organizations that access, create, or manage personal health information is the most precise.