CMS Rolls Out $50B, 5‑Year Rural Health Transformation Fund

The Trump administration has begun implementing a $50 billion, five‑year Rural Health Transformation Program that will send at least $100 million a year to every state to remake how care is delivered in rural America. Created in last summer’s One Big Beautiful Bill tax‑and‑spending law and quietly doubled from $25 billion to $50 billion at the last minute, the fund is meant to address widening life‑expectancy gaps between rural and urban residents and the wave of rural hospital closures, but CMS will allow states to use only up to 15% of the money for direct operating subsidies. CMS Administrator Mehmet Oz says the goal is to "right‑size" rural systems and push states toward broader redesign, with additional dollars allocated based on how rural a state is, what it proposes to do with the funds, and how closely those plans align with the administration’s Make America Healthy Again priorities. States had just 52 days to design applications outlining workforce, innovation and outcome‑improvement plans, and first‑year awards range from about $147 million for New Jersey to $281 million for Texas, with large rural states like Alaska, California and Montana near the top. Health policy experts and Democrats welcome the attention but point out that the temporary $50 billion infusion sits next to roughly $1 trillion in Medicaid and ACA cuts passed in the same law, raising questions about whether the net effect on rural hospitals will be stabilizing or destabilizing over the long run.