Rural Hospitals (Flex Program)


Critical Access Hospitals' Community Benefit Activities: An Updated Review

Document Type

Briefing Paper

Publication Date



Critical Access Hospitals, Flex Program, Community Benefit, CHNA, CAH, FMT, rural, hospitals

Funding Organization or Grant

Federal Office of Rural Health Policy


This Briefing Paper, a companion to Briefing Paper #39, examines community benefit data from the IRS Form 990, Return of Organization Exempt from Income Tax filings for a sample of 50 tax-exempt CAHs to understand how these hospitals are fulfilling their community benefit obligations and to describe the composition of their community benefit spending patterns. This brief updates the Flex Monitoring Team’s (FMT) prior study of the community benefit activities of CAHs and identifies opportunities for CAHs to strengthen their portfolio and reporting of community benefit activities. It also discusses how state Flex programs can support CAHs in meeting their community benefit obligations and address potential gaps in their compliance with the ACA-mandated CHNA financial assistance and billing requirements.


  • Over 94 percent of community benefit expenditures for the study Critical Access Hospitals (CAHs) was for direct patient care activities, compared to less than 6 percent for community-focused (e.g., community education or health improvement) activities.
  • Total community benefit spending among the study CAHs represented 8.4 percent of total hospital expenses; this was slightly higher than in previous studies.
  • Although nearly two-thirds of the study CAHs reported spending for community building activities, the level of spending was less than 1 percent of total hospital expenses.
  • Despite written financial, billing, and collection policies and efforts to publicize the availability of financial assistance to low income and uninsured patients, CAHs indicated high levels of bad debt suggesting they are not reaching patients eligible for financial assistance under their Financial Assistance Policies.
  • Although the hospitals’ financial assistance, billing, and collection policies align with IRS requirements, CAHs appear to need technical assistance in areas related to how they set the maximum amounts charged to patients eligible for financial assistance and how they identify and qualify these individuals for financial support.
  • State Flex programs can be a valuable source of technical assistance to improve CAH community benefit performance and better align their policies with the Affordable Care Act-mandated changes to the IRS tax code for financial assistance, billing, and collection practices