Rural Health Policy

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.

President Donald Trump is participating in a rural health roundtable Friday as the first money begins to flow from the Rural Health Transformation Program, a $50 billion, five‑year fund created by last year’s One Big Beautiful Bill Act to shore up rural care after deep federal cuts to rural hospitals. CMS Administrator Dr. Mehmet Oz said states will share $10 billion for 2026, with an average award of about $200 million, and that CMS has assigned project officers to oversee how each state spends its grant. Every state applied, but funding will not be distributed equally, and critics warn the administration could threaten to claw back money from states whose policies clash with Trump’s agenda. Oz framed the program as a way to "push states to be creative" in redesigning rural health systems, even as some analysts question whether the initiative backfills earlier cuts or uses federal leverage to enforce political litmus tests. The roundtable gives the White House a platform to claim credit for new rural spending at a time when many small hospitals remain on the brink financially.