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History
Health Care Districts had their origins in the aftermath of World Word II. American soldiers returned from the war in need of
extensive medical treatment and often hospitalization. California was in the grip of an acute hospital bed shortage. Significant
portions of the state had no access to necessary healthcare services.
The Legislature responded to this hospital shortage by enacting the Local Hospital District Act, which later became the Health Care
District Act. This body of law authorized communities to form Special Districts to construct and operate hospitals and other
health care facilities to meet local needs. Communities were authorized to impose property tax assessments, with voter approval, to
help subsidize community hospital and health care services. The first Healthcare Districts were formed in 1946 and 1947. The
Association of California Healthcare Districts was originally organized in 1951 to foster the success of the Healthcare Districts
by providing Trustee education and being an effective legislative advocate.
Today, there are 77 Healthcare Districts. 44 of those 77 Districts operate 47 hospitals within their District boundaries. Fifteen
Healthcare Districts have either leased or sold their Hospital facilities to for-profit or not-for-profit Health Systems but still
provide health related services to the people within their District boundaries. The remaining 18 Districts provide health related
services to those living within their Districts.
31 of the 47 Hospitals owned and operated by the Healthcare Districts are considered rural by the State of California. This
represents almost 50% of the rural hospitals in the State. They are the chief source of inpatient, outpatient and emergency
care to California’s rural residents and employees in the agriculture, fishing, mining and timber industries. They provide
a substantial portion of healthcare related services to the underserved regions of the state, which includes minority populations,
the under-insured and the uninsured.
In fiscal year 2000 a significant majority of the 48 District hospitals experienced financial losses ranging from a $100,000 to
over $10,000,000.00. During the past six years, five Healthcare Districts have filed for public entity bankruptcy reorganization
("Chapter 9") and two hospitals have actually ceased to operate.
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ACHD.org
