Exploring and Seeking Approval for the Rural Health Improvement Initiative
The Centers for Medicare & Medicaid Services (CMS) has announced the Rural Health Transformation Program, a new initiative aimed at improving access to healthcare and health outcomes in rural communities across the United States. The program, which is part of the One Big Beautiful Bill Act signed into law on July 4, 2025, comes with a $50 billion budget over five years.
The Rural Health Transformation Program is open to all 50 states, but territories, freely associated states, and Washington, D.C., are not eligible. To receive funding, states must submit one application by the expected deadline in November, detailing a rural health transformation plan and a certification.
CMS will distribute $25 billion equally among all states with approved applications based on alignment with five CMS strategic goals. The remaining $25 billion will be distributed to at least 25% of states based on ruralness, state policies and policy commitments, and the quality of the application.
States are required to commit to using funds for at least three health-related activities, including preventing and managing chronic diseases through evidence-based strategies. Some potential areas of focus include diabetes prevention programs, blood pressure self-monitoring programs, falls prevention programs, youth vaping cessation telehealth resources, interventions to prevent and detect cancer early, and more.
The program aims to expand the reach of specialty workforce via telehealth, fund training and certification programs for community health workers, peer support services in emergency departments, crisis response teams, and doulas, among others. It also seeks to advance interoperability with health care systems, electronic case reporting, syndromic surveillance, and immunization registry upgrades.
The Rural Health Transformation Program will be administered by CMS from 2026-2030. CMS expects to take six weeks for application review, and there is no requirement for states to match the awarded allotment of funds.
State health officials are encouraged to connect early with their Governor's office, identify all additional relevant partners, start conversations with partners early to align shared goals, opportunities, and expectations for funding, and explore opportunities to braid or layer resources from the fund with other funding sources. They are also advised to consider how the health agency can support the tracking of data and outcome measures of interest for rural state residents, engage rural community leaders and residents in developing transformation plans and implementing projects, and discuss sustainability early and often when considering opportunities.
However, it is important to note that according to the Congressional Budget Office, the One Big Beautiful Bill Act may cause over 10 million people to lose their health insurance coverage by 2034. The bill will impact Medicaid, insurance programs created by the Affordable Care Act, food nutrition programs, and other services.
As the application process for the Rural Health Transformation Program begins in mid-September, state health officials are encouraged to carefully consider their rural health needs and develop comprehensive plans to make the most of this significant funding opportunity.
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