Hot spots,food allergies,or mange??

but he doesn't have but one or two fleas only,

Dogs that  are allergic to fleas is not just the flea itself but the saliva of the flea which can cause irritation for days.
 
"Besides the skin problem he has worms" Which is caused by ingesting flea's and larvae. Get him some Strongid-T liquid wormer. It is 1cc per 10lb for an adult dog and 1cc per 5lbs for a puppy and de worm him yet again. The worms you described sound like Hook worms and can cause more health problems for the little guy if not taken care of.

Please do NOT use Vinegar on the little guy's skin. It will irritate it more than it is now.
And yes, it sounds like a flea dermatitis reaction going on here. Depending on how bad the skin looks, he may also need an oral and topical antibiotic to help clear up the infection.
Hope this helped you in some way. The little guy sounds like he is miserable.

This sounds like multiple problems and I'd start with a visit to the vet and take a fecal sample with you.  It will help to treat the worms if you find out exactly what kind they are.  The vet should be able to advise you on what to use for the itching too.  You might try using Benadryl (generic is fine) until you can get into the vet though.  The dosage is 1 mg per lb. 

Thanks you guys! []

Hi -- the very FIRST place you must go is the vet.  The excessive scratching you are talking about doesn't sound like demodex -- it sounds like sarcoptic mange.  That IS contagious, but it is also extremely immune-related (both kinds of mange are -- demodectic mange is a genetic-linked poor immune system that allows the demodex mites -- which are totally normal and common to all mammals -- to proliferate, sarcoptic mites are not 'normal' but will flock to an animal with low immunity).  It's not unheard of for a dog to have BOTH types of mange at once.  Demodectic mange IS a puppy thing --if a mature dog has demodex and it's the first time IT IS A PROBLEM.  Demodex that happens in a mature dog is literally a "symptom" of something far more serious like Cushings or Lupus.
 
I can send you information on mange (I have a lot of experience with this) but you have to get it diagnosed.  You also have to have the dog treated if the skin is infection (which it sounds like it is).  Infected skin won't heal.
 
Flea allergy dermatitis is an entirely different thing -- it "patterns" (the sore spots start at the base of the tail and work forward on the back and down the backlegs). 
 
But flea allergy dermatitis isn't caused by a "lot" of fleas.  All it takes is ONE flea who bites the dog and dies immediately -- literally, in flea allergy dermatitis the dog is allergic TO the flea 'spit'.  The flea spit is a severe toxin to them and just one bite can make them miserable for weeks. 
 
So a dog diagnosed with flea allergy dermatits HAS to be kept 100% totally flea free ALL the time.
 
It's hard to know what sort of parasites those are -- but in total honestly, have a heart -- get them to get this dog to the vet NOW.  There are too many multi-layers and you can't just treat this stuff with over-the counter wormers safely.  You may wind up treating something that is far more serious than you know.
 
If this is a puppy, roundworms left unchecked can kill.  Tapeworm WILL kill eventually if the dog is left untreated.  And you can *NOT* treat tapeworm with anything over the counter.  Even with the right med it can be tough to kill.
 
The fact that there is blood in the feces makes me think there is likely other parasites at work like hook worm or whip worm.  Those can be fatal fast. 
 
Chi's are prone to a lot of breed-related problems and they historically have poor immune systems.  Once you get some of these problems handled THEN you can perhaps work on controlling future outbreaks in a different way.  But all these things rolled together could easily kill.  I hate to sound like an alarmist but this is far too much for that little constitution to handle.

I agree that she really needs to take him to the vet instead of waiting 2 more weeks when she gets a pay check. I told her that my regular vet,Ginger, would take monthly payments,we have done that before. This morning he threw up twice.It was just yellow liquid,looked more like urine but it was thicker than urine.
    He first started chewing and scratching at the base of his tail and now he scratches behind his ears and behind his front legs and on his sides. There's not a lot of hair loss,only in those places where he really gnaws on himself and by his tail is worst.
 
I'll keep you updated.
Thanks!!

Oh,I just saw something else in your post that I need to clear up: There is not blood OR worms in his feces. The worms pass through the rectum on their own and my cousin said one worm that he passed looked bloody. I am positive there are no worms in his feces and no blood either.The worms are alive also. And he is either a little under a year old or just over 1 year old.

Fortunately, I don't have much experience with worms except for tapeworms.  These do pass thru still alive and look like broken pieces of white rice, but they wiggle.  Honestly though, get her to take the dog and a fecal sample into the vet. If nothing else, tell her it could be a health issue for her and the entire family, including the poor dog. 

The skin stuff DOES sound like flea allergy dermatis -- the placment of the sores is so "text book". 
 
Parasites can be fatal REALLY fast.  She may not have 2 weeks.  It all depends on what it is.
 
And just FYI -- things like hooks and whips ARE "zoonotic" -- that means that humans can catch them from the dogs and children are particularly at risk.  They go into the soil from the dog's feces and a child barefoot or who gets 'ground in dirt' is horribly at risk.
 
Tapes will 'crawl out' of the anus -- if you see a whole string it looks like a little flat piece of fetticine except it's made up of little segments.  These break off sometimes alone - you can actually see the segments move -- pretty gross.  But when they dry near the anus they look almost exactly like dry pieces of rice.  These TOO can be transmitted to humans (and they are carried by fleas). 
 
This gal needs to NOT wait -- she puts everyone at risk with this and hooks and whips are horrible to stay in the soil.  This is one of those times you need to either make payments or borrow money from someone to take the dog to the vet.