diff --git a/docs/operator-manual/health.md b/docs/operator-manual/health.md
index ad37e06437e17..5cc80de6538c5 100644
--- a/docs/operator-manual/health.md
+++ b/docs/operator-manual/health.md
@@ -173,3 +173,36 @@ To test the implemented custom health checks, run `go test -v ./util/lua/`.
 The [PR#1139](https://github.com/argoproj/argo-cd/pull/1139) is an example of Cert Manager CRDs custom health check.
 
 Please note that bundled health checks with wildcards are not supported.
+
+## Health Checks
+
+An Argo CD App's health is inferred from the health of its immediate child resources (the resources represented in 
+source control). 
+
+But the health of a resource is not inherited from child resources - it is calculated using only information about the 
+resource itself. A resource's status field may or may not contain information about the health of a child resource, and 
+the resource's health check may or may not take that information into account.
+
+The lack of inheritance is by design. A resource's health can't be inferred from its children because the health of a
+child resource may not be relevant to the health of the parent resource. For example, a Deployment's health is not
+necessarily affected by the health of its Pods. 
+
+```
+App (healthy)
+└── Deployment (healthy)
+    └── ReplicaSet (healthy)
+        └── Pod (healthy)
+    └── ReplicaSet (unhealthy)
+        └── Pod (unhealthy)
+```
+
+If you want the health of a child resource to affect the health of its parent, you need to configure the parent's health
+check to take the child's health into account. Since only the parent resource's state is available to the health check,
+the parent resource's controller needs to make the child resource's health available in the parent resource's status 
+field.
+
+```
+App (healthy)
+└── CustomResource (healthy) <- This resource's health check needs to be fixed to mark the App as unhealthy
+    └── CustomChildResource (unhealthy)
+```