The Centers for Medicare & Medicaid Services announced that all 50 states will receive funding under the Rural Health Transformation Program, a $50 billion initiative aimed at strengthening and modernizing healthcare in rural communities nationwide.
The program, established under President Donald Trump's Working Families Tax Cut legislation, will distribute funding over five years, with $10 billion available annually from 2026 to 2030.
States will receive first-year awards in 2026, averaging about $200 million, with individual allocations ranging from $147 million to $281 million.
CMS said the funding is intended to expand access to care in rural areas, strengthen the rural health workforce, modernize facilities and technology, and support new care delivery models designed to bring services closer to patients.
Texas received the largest single allocation, at $281 million, reflecting its size and rural health needs.
Alaska, while receiving a smaller total amount than Texas, ranked highest on a per-person basis because of its comparatively small population, resulting in the largest per-capita share among the states.
Health and Human Services Secretary Robert F. Kennedy, Jr. said the program is designed to ensure that Americans living in rural areas have access to quality healthcare close to home.
The CMS administrator, Dr. Mehmet Oz, described the funding as a major investment intended to support state-led plans to expand access, modernize care delivery, and strengthen local health systems.
According to CMS, states will use the funding to expand preventive, primary, maternal, behavioral, and emergency health services, strengthen emergency medical response, and address chronic disease.
Additional investments will support workforce training, recruitment, and retention, as well as modernization of rural facilities, cybersecurity, telehealth, and digital health tools.
The program's funding formula allocates half the funds evenly among participating states, while the remaining half is distributed based on factors such as rural population levels, the condition of rural health systems, state policy actions, and the projected impact of proposed initiatives.
CMS said it will work closely with states through dedicated project officers, regular reporting, and annual meetings to track progress and share best practices as the program moves into implementation.
The Working Families Tax Cut legislation includes significant eligibility and financing reforms affecting Medicaid and the Children's Health Insurance Program, with an emphasis on ensuring that individuals enrolled in the programs meet eligibility requirements.
The law also highlights a connection between health coverage and work through community engagement provisions.
CMS said the eligibility changes are designed to strengthen verification standards and promote lawful enrollment in Medicaid and CHIP.
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