Rural Health Transformation Money Starts Flowing to Hospitals

The $50 billion Rural Health Transformation Program is no longer a line in a spending bill. Over the past four days the Centers for Medicare & Medicaid Services has announced the first wave of project-level awards in four states, and the money is going to rural hospitals, ambulance services, training programs and maternal care networks.

On Monday CMS announced $16.4 million for Maryland to train and keep rural healthcare workers. That followed Friday’s announcements of $92 million for Ohio, more than $11 million for New Hampshire and $3.63 million for Montana. Each award is drawn from the first-year allocation every state received in late December, when CMS approved all 50 state applications with first-year awards averaging $200 million, in a range of $147 million to $281 million.

“President Trump gave states the resources to transform rural healthcare, and now we’re seeing those dollars move from plans into action,” CMS Administrator Dr. Mehmet Oz said in the Ohio announcement.

For rural hospitals, EMS agencies, home care providers, nursing programs and equipment vendors, this week is the signal that the program has shifted from planning to purchasing. Here is where the money is going and how to position for it.

Where is Rural Health Transformation money going first?

Ohio, $92 million. The largest award so far splits three ways: $31.4 million to build coordinated rural care networks, including clinically integrated networks and what the state calls Rural Health Innovation Hubs linking physicians, hospitals, clinics, EMS, behavioral health providers, pharmacists and colleges; $30.3 million to hospital networks and health centers for maternal care; and $30.3 million for one-time equipment and facility upgrades at 22 rural hospitals, including a new behavioral health unit, on-site MRI services and expanded diagnostic capacity, according to the CMS announcement.

Maryland, $16.4 million. This one is about people, not buildings. The money funds training for healthcare jobs, registered apprenticeships, help with tuition and certification costs, and recruitment and retention of nurses, physician assistants, physicians and dentists in rural counties. It also pays for dental assistant training with support for tuition, transportation and uniforms, and for programs that steer middle and high school students toward healthcare careers.

New Hampshire, more than $11 million. The state is building out Mobile Integrated Health, in which EMS crews deliver care in homes and communities rather than only transporting patients, and funding partnerships between municipalities, EMS agencies and rural hospitals.

Montana, $3.63 million. Awards go to 17 rural EMS agencies to add staff, cover transportation and equipment, and integrate with clinics through training and electronic health records. Paramedics will carry out care plans under a medical director, including post-discharge follow-up, fall risk assessments, wound care, lab draws and point-of-care testing, with a focus on patients managing chronic conditions like diabetes and asthma who have trouble getting to a clinic.

How does the Rural Health Transformation Program work?

Congress created the program in the 2025 budget reconciliation law, Public Law 119-21, which the administration calls the Working Families Tax Cuts Act. It provides $10 billion a year for five fiscal years, 2026 through 2030. Half of each year’s money is split equally among the states with approved plans; the other half is weighted by factors including each state’s rural population and the strength of its application. Rural hospitals and providers do not apply to CMS directly. States receive the money and run their own sub-award processes, which is why the announcements this week came state by state with very different priorities.

The Kaiser Family Foundation’s analysis of the program notes that the fund was added to the same law that cut federal Medicaid spending, and that it is meant in part to offset the effect of those cuts on rural providers, who rely heavily on Medicaid. Whether $10 billion a year does that is a live argument. What is not in dispute is that the money is real, it is obligated through 2030, and this week it started landing.

Who should be paying attention

• Rural hospitals and critical access hospitals: equipment and facility upgrades are an approved use. Ohio’s $30.3 million for 22 hospitals is the template. If your state has not yet opened its equipment solicitation, ask your state office of rural health when it will.
• EMS and ambulance services: three of this week’s four awards fund EMS, specifically community paramedicine and mobile integrated health. Agencies that can show a plan to treat patients in place and reduce avoidable ER visits are the ones getting funded.
• Home care and senior care providers: the Montana model pays paramedics to do post-discharge follow-up, fall risk assessments and wound care in patients’ homes. Home health agencies should expect both competition and partnership opportunities with EMS under these programs.
• Nursing schools, community colleges and training companies: Maryland’s award is almost entirely workforce. Apprenticeship sponsors and certification programs are direct beneficiaries.
• Medical equipment and health IT vendors: hospital equipment upgrades, EMS equipment, EHR integration and telehealth tools are explicitly funded. Sales cycles will run through state contracts and hospital procurement, not CMS.

The practical first step for any provider is the same: find the agency running your state’s program, read the state’s approved plan, and get on the distribution list for sub-award solicitations. CMS lists state contacts on its Rural Health Transformation page. HNC’s earlier reporting on the hidden costs of outdated patient care equipment and the healthcare workforce crisis lays out the problems this money is meant to fix.

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