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Here is a quick look at the most important aspects of the Rural Health Transformation Program (RHTP):
RHTP represents a landmark initiative designed to reshape the landscape of rural healthcare. Authorized by the One Big Beautiful Bill Act, this program empowers states to enhance health care services and improve outcomes for residents in rural communities. By investing in a stronger, more resilient health care delivery ecosystem, the RHTP aims to address long-standing challenges and create a healthier future for rural America. This initiative is more than just funding; it's a strategic effort to transform how care is delivered.
Rural communities have experienced rising challenges and decreased access to care in recent decades. RHTP is built on a vision of system-wide change and aims to provide crucial support to affected hospitals and providers, helping them adopt innovative models and become more sustainable access points for care. The goal is to move beyond temporary fixes and establish a foundation for long-term success.
This transformation involves a focus on preventative health, modern technology, and a stronger workforce.
The RHTP provides some of the tools necessary to transform care delivery and ensure sustainable, high-quality services for rural residents.
RHTP aims to address the root causes of health disparities in America, building a more robust care delivery system. The program seeks to spark meaningful and lasting improvements in community well-being.
Its primary goal is to support innovations and create new access points for care. This encourages evidence-based interventions to improve disease prevention, manage chronic conditions, and expand behavioral health services and maternal care. By focusing on preventative medicine, RHTP aims to shift the paradigm from reactive treatment to proactive wellness.
Examples of these transformative initiatives have already launched in states such as Louisiana, Georgia, and Connecticut, where targeted efforts focus on expanding resources, access, and quality of care. In states like Texas, examples of proposed initiatives for funding focus on reducing chronic disease through prevention, wellness, and nutrition services, using advanced technology such as AI, and protecting patient data by improving rural cybersecurity.
Ultimately, the program is designed to improve outcomes and coordinate care more effectively. This includes implementing new payment mechanisms that incentivize value and efficiency. Through these strategic goals, the RHTP provides some of the tools necessary to transform care delivery and ensure sustainable, high-quality services for rural residents.
A successful transformation requires collaboration among many different groups. The RHTP framework is designed to bring together key stakeholders at the national, state, and local levels. The Centers for Medicare & Medicaid Services (CMS) is at the helm, managing the program and its funding distribution.
State agencies play a pivotal role, as they were responsible for applying for the funds and developing a detailed transformation plan. These agencies needed to work closely with providers and local partners to identify needs and outline strategies for improvement. The formation of regional strategic partnerships is essential for sharing best practices and maximizing economies of scale.
Effective implementation relies on the active participation of various entities. Key stakeholders include:
This historic funding—$50 billion over five years—will mitigate the financial pressures on rural health care (RHC) providers and make the system more effective and sustainable, particularly as other changes to Medicaid services take effect. This financial commitment underscores a national priority to revitalize the country's rural health infrastructure.
The RHTP funding structure, established by Public Law 119-21, allocates $50 billion over five fiscal years. Beginning in fiscal year 2026, $10 billion in RHTP funds will be available each year through 2030. Half of this annual amount will be distributed equally among all approved states, while the other half will be allocated based on factors like a state's rural population and the number of rural facilities.
This significant investment is not intended to fully replace anticipated reductions in other federal funding. Providers must view these funds as one component of a broader strategy for long-term financial health. To promote comprehensive improvements in RHC services, states are required to use the funds for at least three approved activities.
| Approved uses of RHTP funds |
|---|
| Promoting interventions for prevention and chronic disease management |
| Providing payments to health care providers for items or services |
| Promoting consumer-facing, technology-driven health solutions |
| Providing training and technical assistance for adopting technologies like AI and remote monitoring |
| Recruiting and retaining clinical workforce talent for rural communities |
| Providing IT assistance, software, and hardware to enhance efficiency and cybersecurity capability development |
| Assisting rural communities in right-sizing their health care delivery systems |
| Supporting access to mental health and substance use disorder treatment services |
| Developing projects that support innovative models, including value-based care |
To access RHTP funds, states submitted a one-time application to CMS for approval. The window to apply was narrow, with all applications required to be approved or denied by by the end of 2025. CMS released a Notice of Funding Opportunity (NOFO) with detailed instructions for state agencies looking to apply.
Eligibility was explicitly defined at the state level. According to the authorizing law, only the 50 U.S. states are eligible to apply for and receive an RHTP award. The District of Columbia and U.S. Territories were not eligible to participate.
Each state that receives funding is responsible for distributing the funds within its borders to support rural providers and healthcare delivery systems. The goal is to channel this investment into initiatives that directly improve patient outcomes and strengthen the health of rural communities.
Therefore, while individual rural hospitals and clinics could not apply for funding, they are the intended beneficiaries. These providers should work closely with their state agencies to ensure their needs are represented in the state's transformation plan and to participate in the initiatives it supports.
For state agencies, the application process for RHTP funding was time-sensitive and required careful preparation. To support applications, CompuGroup Medical conducted outreach to states offering expertise and long-term support based on our strength and experience working with rural practices.
Other resources included:
Applications closed in early November 2025. CMS announced its final award decisions on December 29, 2025, and included a table of each state's award.
The National Rural Healthcare Association created this Rural Health Transformation Program State Application Summary to show exactly which initiatives are being pursued by each state.
RHTP takes a big step towards enhancing healthcare access and quality in rural communities. By prioritizing funding and support for innovative health solutions, RHTP will help improve access to care and reduce some of the disparities faced by these underserved populations. With the right collaboration and commitment, RHTP has the potential to create lasting improvements in rural health services.
The RHTP stands apart due to its scale and scope. It represents an unprecedented federal investment focused on system-wide transformation rather than isolated projects. Its emphasis on fostering innovative models for disease prevention, promoting new technologies, and ensuring long-term sustainability is designed to create lasting improvements in health outcomes.
RHTP is expected to deliver significant improvements to rural communities. These include better health outcomes through enhanced preventative care, greater access to a wider range of healthcare services, including mental health services, and an overall increase in the quality of care. The program aims to make healthcare more efficient and patient-centered.
