7 IRS Requirements Every Nonprofit Hospital CHNA Must Meet
A Community Health Needs Assessment isn’t just good practice for a nonprofit hospital. It’s a legal requirement under IRC Section 501(r)(3), and the IRS is specific about what counts as meeting it. Here’s what the requirement actually covers.
1. Conduct a CHNA at least once every three years
Every hospital facility operated by a 501(c)(3) organization has to complete a CHNA in the taxable year or in either of the two immediately preceding taxable years. Missing this window puts the facility out of compliance, regardless of how strong the assessment itself is.
2. Define the community served, without excluding those who need it most
A hospital can define its community based on geography, target populations, or its principal function. What it can’t do is define that community in a way that excludes medically underserved, low-income, or minority populations who live in its service area or draw on its care. The definition has to reflect who the hospital actually serves, not a narrower version of it.
3. Assess and prioritize the community’s significant health needs
Beyond identifying health needs, the hospital has to prioritize them and identify what resources already exist to address them, whether those resources belong to the hospital or elsewhere in the community. There’s no single required method for prioritization. The IRS allows criteria like severity, feasibility of intervention, health disparities involved, and how much the community itself weighs the issue.
4. Solicit input from specific required sources
This is one of the most detailed parts of the requirement. A hospital must solicit and take into account input from:
- At least one state, local, tribal, or regional public health department with relevant expertise
- Members of medically underserved, low-income, and minority populations in its community, or organizations representing them
- Written comments received on the hospital’s most recently conducted CHNA and implementation strategy
Additional voices, like consumer advocates, academic experts, and community organizations, are welcome but not required in the same way these three are.
5. Document the CHNA in a formal written report
The report has to include a defined community, a description of the process and methods used, how community input was solicited and incorporated, a prioritized list of significant health needs, available resources to address them, and an evaluation of how the previous CHNA’s action items actually played out. A report missing any of these pieces doesn’t meet the standard, even if the underlying research was thorough.
6. Make the CHNA report widely available to the public
For every significant health need identified, the hospital’s authorized governing body has to adopt a plan that either describes how the hospital intends to address it or explains why it doesn’t intend to. This has to happen by the 15th day of the fifth month after the end of the tax year in which the CHNA was completed, the same deadline as the hospital’s Form 990.
7. Adopt a written implementation strategy
The report has to include a defined community, a description of the process and methods used, how community input was solicited and incorporated, a prioritized list of significant health needs, available resources to address them, and an evaluation of how the previous CHNA’s action items actually played out. A report missing any of these pieces doesn’t meet the standard, even if the underlying research was thorough.
Why this level of detail matters
None of these seven requirements are optional add-ons. A CHNA that skips the required input sources, or one whose implementation strategy doesn’t explain why a need went unaddressed, can put a hospital’s compliance at risk even if the research itself was solid. The requirement isn’t just “do a needs assessment.” It’s a specific process with specific documentation, and it rewards a partner who treats the compliance side with the same rigor as the research side.
