"The program will distribute $50 billion to states between fiscal year 2026 and fiscal year 2030, with $10 billion released each year. That represents roughly a 50% increase in federal spending on rural healthcare, which currently totals about $19 billion per year through Medicaid. To qualify for funding, states must submit a detailed plan outlining how they intend to use the money to improve rural healthcare."
"Just how dire is the state of rural healthcare? About a third of rural hospitals are currently at risk of closure. Most rural providers struggle with low patient volumes, high fixed costs, heightened workforce shortages and heavy reliance on Medicaid and Medicare reimbursement. CMS wants to "right-size" the rural healthcare system CMS Administrator Dr. Mehmet Oz framed the fund as a "grand experiment" during a talk last week at Sanford Health's Annual Summit on the Future of Rural Health Care."
The Rural Health Transformation Program will distribute $50 billion to states from fiscal year 2026 through 2030, releasing $10 billion each year. The funding represents roughly a 50% increase in federal spending on rural healthcare relative to current Medicaid-funded totals. States must submit detailed plans to qualify, with all 50 states filing intent to apply, grant applications due November 5, and funding allocated by year-end. About a third of rural hospitals face closure risk, and providers contend with low patient volumes, high fixed costs, workforce shortages and heavy reliance on Medicaid and Medicare. CMS frames the fund as a bid to right-size the system and prioritize sustainability and quality, but experts say the program will likely fall short of addressing long-standing structural vulnerabilities.
Read at MedCity News
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