There is now an increasing demand for sharing images and image data for process integration among healthcare institutions. Web services technology has recently been widely proposed and gradually adopted as a platform for supporting integrations. The Health Insurance Portability and Accountability Act (HIPAA) imposes rules as national standards to protect individuals? health information in the U.S., highlighting security and privacy protection requirements. There are so far no holistic solutions to tackle the various protection issues in this area, especially in inter-institutional healthcare progress integration. We propose the exchange of medical images through a Medical Image Exchange Platform (MIEP), especially replacing ad-hoc and manual exchange practices. We show how contemporary technologies of Web services and watermarking can help archive images with layered implementation architecture. Through dedicated Web services technologies with watermarking mechanism, not only can the development, deployment, and maintenance of software be streamlined, the privacy protection in medical image exchanges as required by disparate processes can also be much facilitated.