On Monday, the Centers for Medicare & Medicaid Services (CMS) announced $50 billion in grants to all 50 U.S. states to be used for the sole goal of transforming health care in rural America. As the White House announced, the Rural Health Transformation Program was established through Trump’s Working Families Tax Cuts legislation in the One Big Beautiful Bill, which President Donald Trump signed into law in July. This first-of-its-kind initiative represents the largest federal investment in rural health care in U.S. history.
Today, @CMSGov announced that all 50 states will receive awards under the Rural Health Transformation Program, a $50 billion initiative established under the Working Families Tax Cuts legislation to strengthen and modernize health care in rural communities across the country.… pic.twitter.com/btt5fuCTn7
— DrOzCMS (@DrOzCMS) December 29, 2025
Today, @CMSGov announced that all 50 states will receive awards under the Rural Health Transformation Program, a $50 billion initiative established under the Working Families Tax Cuts legislation to strengthen and modernize health care in rural communities across the country. This unprecedented federal investment will help states expand healthcare access, support the communities that keep our nation running, and create lasting improvements for rural families.
From the CMS press release.
The Centers for Medicare & Medicaid Services (CMS) today announced that all 50 states will receive awards under the Rural Health Transformation Program, a $50 billion initiative established under President Trump’s Working Families Tax Cuts legislation (Public Law 119-21) to strengthen and modernize health care in rural communities across the country. In 2026, states will receive first-year awards from CMS averaging $200 million within a range of $147 million to $281 million. This unprecedented federal investment will help states expand access to care in rural communities, strengthen the rural health workforce, modernize rural facilities and technology, and support innovative models that bring high-quality, dependable care closer to home.
“More than 60 million Americans living in rural areas have the right to equal access to quality care,” said Health and Human Services Secretary Robert F. Kennedy, Jr. “This historic investment puts local hospitals, clinics, and health workers in control of their communities’ healthcare. Thanks to President Trump’s leadership, rural Americans will now have affordable healthcare close to home, free from bureaucratic obstacles.”
However, as CMS administrator Dr. Mehmet Oz explained to Scripps News’ Morning Rush program, the funding is not meant to pay bills or to solely create new rural hospitals. The goal is to give rural health care providers the power and opportunity to reimagine rural health care and rebuild infrastructure that works for the people in that geographic region; not just place a Band-Aid over a one-size-fits-all system that siphons away money while failing to deliver on effectiveness.
Dr. Oz said:
There was a grant process that was adjudicated, graded by outside experts. We just wanted to see how good the ideas were. And the good ideas and the bad ideas were quickly differentiated, and people with the bad ideas did not get funding for them.
One issue that I want to highlight, because it’s the core of your question, is this money is not there to pay bills. If you have a hospital that has only one person staying in there, and another hospital with only one person staying in there, there might be opportunities within your community to combine forces, join up with a third hospital, build different kinds of clinics, do more preventative care. So, we want the money to be used to change the way we envision health care in rural America, not just to pay bills on programs getting created 60-70 years ago that don’t seem to be working.
In early December, Republican Rep. Diane Harshbarger (TN-01) penned an op-ed on this concept of reinventing a system that works for citizens in rural communities rather than wasting more money on faulty systems, which tend to serve major cities rather than rural concerns.
Rural healthcare doesn’t need more Band-Aids. It needs structural reform. It needs Congress to admit a one-size-fits-all model doesn’t work the same for a town of 5,000 as it does for a city of 5 million.
The same philosophy is behind the new Rural Health Transformation Fund, created through President Trump’s Working Families Tax Cuts. At $50 billion, it is the single largest investment in rural healthcare in American history. It gives rural hospitals the resources to stabilize, modernize, expand services, and design long-term, community-based care systems that actually fit their needs.
Rural America isn’t asking for the impossible. They’re asking for a healthcare system that is accessible, affordable, and recognizes their challenges instead of penalizing them for living too far from big cities. Every community, big or small, deserves the chance to thrive. And that starts with dependable, local care.
If we’re willing to take an honest look at what isn’t working and modernize the outdated policies holding rural communities back, we can finally build a system that serves everyone. We can train more doctors where they’re needed, strengthen rural hospitals, and give families confidence that care will be there when they need it.
Dr. Oz pinpointed that part of the use of these funds was meant to train and equip personnel who will serve rural areas, as well as maximize technology in order to reach more people, more efficiently.
Oz continued:
And by doing this the right way, and by allowing more practitioners to move to these areas, training nurses and doctors in these rural areas, we think they’ll stay put and provide high quality care.
But also, think about where technology is now. You know, we don’t watch videos the same way, we don’t order food the same way, certainly our banking has changed because of technology. Where is the telemedicine opportunity in rural America? How do we use AI to improve the quality of care that you might be getting for mental health services when you just can’t get to a psychiatrist’s office in the big city and there are no practitioners in rural America? So, no, we want states to brainstorm better solutions. Some states do need to help their hospitals more than others. But oftentimes, the bigger challenge is how do you make the system more efficient so that whatever services you’re offering are sustainable.
WATCH:
.@DrOzCMS on the $50B in CMS awards to strengthen rural healthcare in all 50 states: “This money is not there to pay bills… We want the money to be used to change the way we envision healthcare in rural America.” pic.twitter.com/lWFYlbwUo8
— Rapid Response 47 (@RapidResponse47) December 29, 2025
The state of Texas will receive the highest amount of $281,319,361, with Alaska receiving the second largest amount of $272,174,856. The usual suspects expressed rancor over this, looking toward undue political influence and population numbers rather than geographic and infrastructure challenges.
So Alaska, with a population of 780,000 gets more money for rural health than California, which has a population of over 39 million. Seems fair.
— Mark Concannon (@MarkConcannonSU) December 29, 2025
What is not being reported are the generous amounts being granted to all 50 United States, and not just a select few receiving the lion’s share. At least 27 states will receive over two hundred million in funding. In terms of monetary amount, California is among the states in the Top 10 of highest awards, to the tune of $233,639,308. Like all of these states, the major population centers are urban and therefore do not factor in the grantmaking decision. So, it has little to do with lack of fairness or political maneuvering, and much to do with the specific needs and health care access deficits for each state. With the gross mismanagement of federal funding toward health care in this state, the fact that they are getting such a sizeable amount is a testament to CMS’ fairness.
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Republican Rep. Nick Begich (AK-AL) spoke to some of the “WHY” behind Alaska receiving such a sizeable award.
Alaska’s geography demands innovation. And while distance will always be a reality of life in the Last Frontier, we can close the gap in care by investing in solutions designed for rural life.
To meet the needs of communities disconnected from the road system, we must continue expanding modern digital and telehealth infrastructure. Strengthening broadband and secure telemedicine tools will allow every village clinic to connect with specialists in Anchorage, Fairbanks, or anywhere in the country. That kind of access is transformative. It means fewer costly medevacs, faster diagnoses, and care that reaches people where they are.
Begich also discussed the shortage of qualified personnel, which appears to be an issue across the board for all rural locales. One of the goals of the rural grants outlined by CMS is to expand:
preventive, primary, maternal, and behavioral health services and creating new access points that bring care closer to home and help preserve strong local health systems. Many states are implementing evidence-based, outcomes-driven strategies—such as physical fitness and nutrition programs, food-as-medicine initiatives, and chronic disease prevention models—to address root causes of diseases and manage chronic conditions.
Health care activists and advocates pinpoint two areas that fly in the face of the above and could derail CMS’ intent that the funding be used to transform the rural health care landscape: the Affordable Care Act Rule 6001, which outlawed physician-owned hospitals, and the Certificate of Needs (CON) boards in certain states. Both of these bureaucratic roadblocks have only served to limit competition and opportunities rather than expand them. In the case of the CON boards, some even prevent holistic and alternative medical practices and practitioners — such as midwifery — from setting up practices alongside traditional medical models.
Fifty percent of the Rural Health Transformation Plan funding will be distributed equally among the states in order to foster its implementation. The other 50 percent will be allocated based on a variety of factors outlined in the Notice of Funding Opportunity distributed by CMS. Fifty billion of the funds will be allocated over five years, with $10 billion available each year from 2026 through 2030.
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