The Spotify Student Discount is here

> They are using something called http://www.sheerid.com/ to verify student status. This strikes me as a little strange that such a service exists, does that not violate HIPPA laws?

HIPAA deals with health information, which doesn't seem to be at issue here. FERPA deals with education information, but specifically permits disclosure of "directory information" without prior consent. [1]

[1] https://www2.ed.gov/policy/gen/guid/fpco/ferpa/students.html