Many Texas residents pay taxes into special districts designed to support local healthcare efforts. These hospital districts have their origins enshrined in the Texas Constitution as a means for individual communities to fund their local hospital operations by electing to tax themselves. This report outlines the history of the hospital district in Texas with a review of historical newspaper articles and public records. The report then outlines the legal authorities and responsibilities of these districts through a statutory and legal case review. Hospital districts have a few different means of governing their hospital operations and this report explores those structures with several examples. As these districts are primarily funding mechanisms, a chapter is devoted to cataloging the tax rates, taxing methods, and other funding methods used within the districts. The report concludes with a case study of a prominent hospital district, the Travis County Healthcare District now known as Central Health