On Dec. 29, 2025, the Centers for Medicare and Medicaid Services (CMS) announced that all 50 states would receive funding under the Rural Health Transformation Program, which is mandated in the One Big Beautiful Bill Act.
Uses of Funds
States must use the funds for three or more approved expenditures:
- Promoting evidence-based, measurable interventions to improve prevention and chronic disease management.
- Providing payments to health care providers for the provision of health care items or services, as specified by the administrator.
- Promoting consumer-facing, technology-driven solutions for the prevention and management of chronic diseases.
- Providing training and technical assistance for the development and adoption of technology-enabled solutions that improve care delivery in rural hospitals, including remote monitoring, robotics, artificial intelligence and other advanced technologies.
- Recruiting and retaining clinical workforce talent to rural areas, with commitments to serve rural communities for a minimum of five years.
- Providing technical assistance, software and hardware for significant information technology advances designed to improve efficiency, enhance cybersecurity capability development and improve patient health outcomes.
- Assisting rural communities to right size their health care delivery systems by identifying needed preventative, ambulatory, pre-hospital, emergency, acute inpatient care, outpatient care and post-acute care service lines.
- Supporting access to opioid use and other substance use disorder treatment services, as well as mental health services.
- Developing projects that support innovative models of care that include value-based care arrangements and alternative payment models, as appropriate.
- Additional uses designed to promote sustainable access to high quality rural health care services, as determined by the administrator.
Awardees and Funding Amounts
The Rural Health Transformation (RHT) Program includes $50 billion, allocated in increments of $10 billion over five years beginning in 2026. Half of the funding is distributed equally among all approved states, and the remaining amount was allocated based on a formula.
Strategic Goals
The Notice of Funding Opportunity (NOFO) posted on Sept. 15, 2025, stated that the RHT Program would help state governments support rural communities by improving health care access quality and outcomes by transforming the health care delivery ecosystem. The program also seeks to promote innovation, strategic partnerships, infrastructure development and invest in the workforce. Further, the NOFO described these priorities:
- Support rural health innovations and new access points to promote preventative health and address root causes of diseases.
- Use evidence-based, outcomes-driven interventions to improve disease prevention, chronic disease management, behavioral health and prenatal care.
- Share or coordinate operations between rural and regional health care systems, technology, primary and specialty care and emergency services.
- Attract and retain a high-skilled health care workforce by strengthening recruitment and retention of health care providers in rural communities.
- Help rural providers practice at the top of their license and develop a broader set of providers to serve a rural community’s needs, such as community health workers, pharmacists and individuals trained to help patients navigate the health care system.
- Grow innovative care models to improve health outcomes, coordinate care and promote flexible care arrangements.
- Develop and implement payment mechanisms incentivizing providers or Accountable Care Organizations (ACOs) to reduce health care costs, improve quality of care and shift care to lower cost settings.
- Foster use of innovative technologies that promote efficient care delivery, data security and access to digital health tools by rural facilities, providers and patients.
- Projects support access to remote care, improve data sharing, strengthen cybersecurity and invest in emerging technologies.
