Board Composition

In this section:

Primary Reviewer: Governance/Administrative Expert

Secondary Reviewer: N/A

Authority: Section 330(k)(3)(H) of the Public Health Service (PHS) Act; and 42 CFR 51c.304 and 42 CFR 56.304

Health Center Program Compliance Manual Related Considerations

Documents the Health Center Provides

Compliance Assessment

  1. Is the health center operated by an Indian tribe, tribal group, or Indian organization under the Indian Self-Determination Act or an Urban Indian Organization under the Indian Health Care Improvement Act?1

    Response is either: Yes or No

    NOTE: If “Yes” was selected, NONE of the questions for ANY of the elements in the Board Composition section are applicable.

Select each element below for the corresponding text of the element, site visit team methodology, and site visit finding questions.

Footnotes

1. The governing board of a health center operated by Indian tribes, tribal groups, or Indian organizations under the Indian Self-Determination Act or Urban Indian Organizations under the Indian Health Care Improvement Act is exempt from the specific board composition requirements discussed in [the Health Center Program Compliance Manual (PDF - 1 MB)]. Section 330(k)(3)(H) of the PHS Act.

2. An outside entity may only remove a board member who has been selected by that entity as an organizational representative to the governing board.

3. For example, if the health center has an agreement with another organization, the agreement does not permit that organization to select either the chair or a majority of the health center board.

4. For public agencies that elect to have a co-applicant, these board composition requirements apply to the co-applicant board.

5. For the purposes of the Health Center Program, the term “board member” refers only to voting members of the board.

6. Per the regulations in 42 CFR 56.304, for health centers awarded/designated solely under section 330(g) of the PHS Act, no more than two-thirds of the non-patient board members may derive more than 10 percent of their annual income from the health care industry.

7. For the purposes of health center board composition, an employee of the health center would include an individual who would be considered a “common-law employee” or “statutory employee” according to the Internal Revenue Service (IRS) criteria, as well as an individual who would be considered an employee for state or local law purposes.

8. In the case of public agencies with co-applicant boards, this includes employees or immediate family members of either the co-applicant organization or the public agency component in which the Health Center Program project is located (for example, department, division, or sub-agency within the public agency).

9. While no board member may be an employee of the health center, 42 CFR 51c.107 permits the health center to use federal award funds to reimburse board members for these limited purposes: 1) reasonable expenses actually incurred by reason of their participation in board activities (for example, transportation to board meetings, childcare during board meetings); or 2) wages lost by reason of participation in the activities of such board members if the member is from a family with an annual family income less than $10,000 or if the member is a single person with an annual income less than $7,000. For section 330(g)-only awarded/designated health centers, 42 CFR 56.108 permits the use of grant funds for certain limited reimbursement of board members as follows: 1) for reasonable expenses actually incurred by reason of their participation in board activities (for example, transportation to board meetings, childcare during board meetings); 2) for wages lost by reason of participation in the activities of such board members. Health centers may wish to consult with their legal counsel and auditor on applicable state law regarding reimbursement restrictions for non-profit board members and implications for IRS tax-exempt status.

10. Per the regulations in 42 CFR 56.304, for health centers awarded/designated solely under section 330(g) of the PHS Act, no more than two-thirds of the non-patient board members may derive more than 10 percent of their annual income from the health care industry.

11. A legal guardian of a patient who is a dependent child or adult, a person who has legal authority to make health care decisions on behalf of a patient, or a legal sponsor of an immigrant patient may also be considered a patient of the health center for purposes of board representation. Students who are health center patients may participate as board members subject to state laws applicable to such non-profit board members.

12. For health centers that have not yet made a UDS report, this would be assessed based on demographic data included in the health center’s application.

13. Representation could include advocates for the health center’s section 330 (g), (h), or (i) patient population (for example, those who have personally experienced being a member of, have expertise about, or work closely with the current special population). Such advocate board members would count as “patient” board members only if they meet the patient definition set forth in the [Health Center Program Compliance Manual] Chapter 20: Board Composition.

14. For example, in a 9 member board with 5 patient board members, there could be 4 non-patient board members. In this case, no more than 2 non-patient board members could earn more than 10 percent of their income from the health care industry.

15. Per the regulations in 42 CFR 56.304, for health centers awarded/designated solely under section 330(g) of the PHS Act, no more than two-thirds of the non-patient board members may derive more than 10 percent of their annual income from the health care industry.

16. For the purposes of health center board composition, an employee of the health center would include an individual who would be considered a “common-law employee” or “statutory employee” according to the IRS criteria, as well as an individual who would be considered an employee for state or local law purposes.

17. In the case of public agencies with co-applicant boards, this includes employees or immediate family members of both the co-applicant organization and the public agency component (for example, department, division, or sub-agency) in which the Health Center Program project is located.

18. See [Health Center Program Compliance Manual] Chapter 4: Required and Additional Health Services for more information on providing services within the HRSA-approved scope of project.

19. See [Health Center Program Compliance Manual] Chapter 6: Accessible Locations and Hours of Operation for more information on health center service sites and hours of operation.

20. See [Health Center Program Compliance Manual] Chapter 17: Budget for more information on the Health Center Program project budget.

21. See [Health Center Program Compliance Manual] Chapter 19: Board Authority for more information on the health center board’s required authorities.

22. See [Health Center Program Compliance Manual] Chapter 9: Sliding Fee Discount Program for more information on requirements for health center SFDPs.

Date Last Reviewed: