Chapter 3: Needs Assessment

Note: This chapter contains language that was revised based on the Bipartisan Budget Act of 2018. View the revisions (PDF - 582 KB).

In this chapter:

• Authority
• Requirements
• Demonstrating Compliance
• Related Considerations

Authority

Section 330(k)(2) and Section 330(k)(3)(J) of the PHS Act; and 42 CFR 51c.104(b)(2-3), 42 CFR 51c.303(k), 42 CFR 56.104(b)(2), 42 CFR 56.104(b)(4), and 42 CFR 56.303(k)

Requirements

• The health center must define and annually review the boundaries of the catchment area to be served [service area], including the identification of the medically underserved population or populations within the catchment area in order to ensure that the:
  • Size of this area is such that the services to be provided through the center (including any satellite service sites) are available and accessible to the residents of the area promptly and as appropriate;
  • Boundaries of such area conform, to the extent practicable, to relevant boundaries of political subdivisions, school districts, and areas served by Federal and State health and social service programs; and
  • Boundaries of such area eliminate, to the extent possible, barriers resulting from the area's physical characteristics, its residential patterns, its economic and social groupings, and available transportation.
• The health center must assess the unmet need for health services in the catchment or proposed catchment area of the center based on the population served, or proposed to be served, utilizing, but not limited to, the following factors:
  • Available health resources in relation to the size of the area and its population, including appropriate ratios of primary care physicians in general or family practice, internal medicine, pediatrics, or obstetrics and gynecology to its population;
  • Health indices for the population of the area, such as infant mortality rate;
  • Economic factors affecting the population's access to health services, such as percentage of the population with incomes below the poverty level; and
  • Demographic factors affecting the population's need and demand for health services, such as percentage of the population age 65 and over.

Demonstrating Compliance

A health center would demonstrate compliance with these requirements by fulfilling all of the following:

1. The health center identifies and annually reviews its service area¹ based on where current or proposed patient populations reside as documented by the ZIP codes reported on the health center’s Form 5B: Service Sites. In addition, these service area ZIP codes are consistent with patient origin data reported by ZIP code in its annual Uniform Data System (UDS) report (for example, the ZIP codes reported on the health center’s Form 5B: Service Sites would include the ZIP codes in which at least 75 percent of current health center patients reside, as identified in the most recent UDS report).
2. The health center completes or updates a needs assessment of the current or proposed population at least once every three years,² for the purposes of informing and improving the delivery of health center services. The needs assessment utilizes the most recently available data³ for the service area and, if applicable, special populations and addresses the following:
   • Factors associated with access to care and health care utilization (for example, geography, transportation, occupation, transience, unemployment, income level, educational attainment);
   • The most significant causes of morbidity and mortality (for example, diabetes, cardiovascular disease, cancer, low birth weight, behavioral health) as well as any associated health disparities; and
   • Any other unique health care needs or characteristics that impact health status or access to, or utilization of, primary care (for example, social factors, the physical environment, cultural/ethnic factors, language needs, housing status).

Related Considerations

The following points describe areas where health centers have discretion with respect to decision-making, or may be useful for health centers to consider when implementing these requirements:

• The health center determines the most appropriate methodologies, tools, and formats for conducting needs assessments (for example, quantitative or qualitative data sources, focus groups, patient surveys).
• The health center determines how to complete or update its needs assessments (for example, fulfilling the criteria of a Notice of Funding Opportunity (NOFO), participating in community-wide needs assessments, responding to changes within the community).
• The health center may choose to include additional indicators relevant to its service area and population within its needs assessments.
• The health center may choose to include an additional focus on a specific underserved subset of the service area population (for example, children; persons living with HIV/AIDS; elderly persons), as part of its overall assessment of need in its service area.

Footnotes

^1. Also referred to as “catchment area” in the Health Center Program implementing regulation in 42 CFR 51c.102.

^2. Compliance may be demonstrated based on the information included in a Service Area Competition (SAC) or a Renewal of Designation (RD) application. Note that in the case of a Notice of Funding Opportunity for a New Access Point or Expanded Services grant, HRSA may specify application-specific requirements for demonstrating an applicant has consulted with the appropriate agencies and providers consistent with Section 330(k)(2)(D) of the Public Health Service Act. Such application-specific requirements may require a completed or updated needs assessment more recent than that which was provided in an applicant’s SAC or RD application.

^3. In cases where data are not available for the specific service area or special population, health centers may use extrapolation techniques to make valid estimates using data available for related areas and population groups. Extrapolation is the process of using data that describes one population to estimate data for a comparable population, based on one or more common differentiating demographic characteristics. Where data are not directly available and extrapolation is not feasible, health centers should use the best available data describing the area or population to be served.