The Long View
On December 29, 2025, The Centers for Medicare & Medicaid Services (CMS) announced the highly anticipated funding awards to states for the Rural Health Transformation Program (RHTP)—a five-year, $50 billion federal initiative designed to stabilize and transform rural health systems across the country. This new federal investment marks a pivotal moment for states and their partners to address long-standing challenges in rural healthcare while laying the foundation for broader transformation. It provides an opportunity to reimagine care delivery, strengthen infrastructure, and build sustainable models that address entrenched gaps in rural health.
Directing Resources to Rural Communities
RHTP is designed with a focus on rural communities, where residents face persistent challenges such as provider shortages, hospital closures, and limited access to care. RHTP investments will support infrastructure development, IT system implementations and trainings, workforce recruitment and retention, and innovative care models tailored to rural community needs. The long-term goal is to create lasting capacity and resilience in rural health systems and promote better health outcomes for residents.
But the vision doesn’t stop there.
Catalyzing Statewide Transformation
While rural communities are the primary beneficiaries, we believe the impact of the RHTP will extend beyond rural borders. The program’s design encourages states to develop initiatives that can serve as pilots and start-ups, creating scalable solutions that can be adopted statewide. Workforce development programs, for example, may begin by focusing on rural providers and community health workers (CHWs) and training these individuals but, over time, strengthen the healthcare workforce across entire states and regions.
Much of the federal funding will enable states and their partners to invest in technology modernization, telehealth expansion, and integrated care models. These improvements assuredly will enhance access and quality for rural residents. And these same technologies can be deployed to enhance efficiency and coordination across entire health systems, laying the groundwork for broader system transformation and health improvement. The focus on chronic care management and innovative care arrangements has the potential to improve outcomes for all populations.
Collaborative Pathways for States and Partners
States and their partners—including health systems, community-based organizations, and technology innovators—have a valuable opportunity to collaborate on initiatives. In our review of state applications and the initial wave of state driven funding solicitations, we identified efforts to tackle long-standing system challenges, including:
- Data Sharing and Interoperability. States responded to the federal application with extensive technology and data interoperability related investments that have statewide benefits. Several states include information system initiatives that can scale care coordination statewide, including initiatives to build dedicated teams for analytics, data integration, and evaluation and tracking outcomes across initiatives. They have an opportunity to create the statewide backbone—starting with rural hubs and then expanding interfaces systemwide. States also will be advancing consumer-facing technology for preventive and chronic care, grounded in statewide health information exchange (HIE) and data strategy, again testing first in rural settings and accelerating statewide adoption of effective approaches.
- Maternal Health & Perinatal Care. Several states proposed embedding family medicine with obstetrics fellowships, expanding doula/midwife pathways, and deploying remote prenatal monitoring with support from nursing teams. These rural pilots could help standardize practice, improve outcomes, and scale across the state. Many other state proposals explicitly include initiatives to strengthen access to maternity care, linked to broader workforce and technology investments that can be adopted in urban settings.
- EMS Modernization. States also plan to develop and strengthen emergency medical services (EMS)-led preventive and complex care support in rural areas. One application, for example, formalizes such EMS-led support in rural areas, with protocols and training designed to scale broadly. Another state references mobile health and EMS integration, creating rural pilots to improve response, navigation, and handoffs that can be standardized across the emergency care system.
Looking Ahead
RHTP is more than a funding stream. It is a catalyst for innovation and collaboration, providing an important avenue to address the chronic inequities in quality, access, and outcomes that people living in our nation’s rural communities often experience. But it also could foster improvement statewide. Program evaluation and performance monitoring of the small, community-based programs and the large-scale, multi-site, multi-year initiatives will provide insights that inform strategic decision-making at the local, state and federal levels. By scaling effective rural health-focused initiatives and investing in new and feasible tools, strategies, and programs, states can create models that improve care delivery for all their residents in the future. This is a moment for states, providers, and partners to think big and design programs that deliver lasting impact.
Health Management Associates (HMA) offers support to state agencies, health systems, and community partners shaping rural-first pilots that are designed for scalability—from maternal and perinatal care networks, EMS community care models, caregiver and CHW pipelines, to telehealth modernization and behavioral health integration. Our rural expertise and our unique ability to combine expertise in clinical, operational, policy, and data reforms for care improvement are well-suited to the goals of RHTP.
With the RHTP funding advancing to state partners early in 2026 and annual recalculations of state awards tied to performance, the time to design rural pilots that become statewide programs is now.
For questions about the RHTP opportunities for your organization and the solutions HMA can tailor to meet the needs of your state, contact Kathleen Nolan and Andrea Maresca.
Connecting the Dots: A new blog series for 2026
Connecting the Dots is a monthly HMA blog series that brings together insights from our experts to examine the major policy, program, and market forces shaping healthcare coverage, delivery systems, and financing in 2026. The posts look beyond individual changes, instead connect emerging developments across programs and markets to help leaders understand what’s changing, why it matters, and how their decisions shape the path ahead.
