Revitalizing Rural Healthcare: A New Era of Support
Published: November 6, 2025
The Rural Health Transformation Program (RHTP), initiated under the One Big Beautiful Bill Act (OBBA), is channeling $50 billion to bolster rural hospitals and healthcare providers. On September 15, the Centers for Medicare & Medicaid Services (CMS) outlined the process for states to apply for this substantial funding.
With the application window now closed, communities are eagerly awaiting the U.S. Department of Health and Human Services (HHS) to announce funding decisions. Here are some frequently asked questions to guide you through the process.
Key Dates and Monitoring
When Will Funding Decisions Be Made?
Expect announcements by December 31, 2025.
When Does Oversight Begin?
CMS will initiate ongoing monitoring and support starting in 2026.
Distribution of Funds
How Are Funds Allocated?
Half of the funds will be evenly distributed among states with approved applications. The remaining funds will be allocated based on:
- Rural population share
- Number and needs of rural health facilities
- State-specific hospital needs
- Other factors identified by CMS
Are All States Eligible?
Yes, all 50 states can receive funding. However, the District of Columbia and U.S. territories are not eligible.
Utilization and Deadlines
What Is the Timeline for Using Funds?
Funds must be utilized by the end of the fiscal year following each budget period.
- Budget Period 1: December 31, 2025 – September 30, 2026
- Subsequent periods start October 31 each year through FY2030
What Happens to Unused Funds?
Unspent funds will be redistributed in the next fiscal year and must be used by its end, except for FY2032 funds, which must be used by the end of FY2032.
Can Funds Cover Medicare or Medicaid?
No, funds cannot be used for services already covered by insurance or other reimbursement sources.
Administration of Awards
How Will States Be Informed of Selection?
Selected applicants will receive a Notice of Award (NoA) via the CMS Grant Solutions system, signed by the CMS Grants Management Officer.
What If an Application Is Rejected?
CMS will notify applicants electronically within 30 days of the award date.
How Long Is Eligibility Valid?
Approved states remain eligible for the five-year program, contingent on:
- Continued program authority and funding
- Satisfactory performance
- Compliance with award terms
Can Funding Be Revoked?
Yes, CMS may suspend or terminate funding if performance or reporting standards are not met.
- Tip: States must submit progress and post-award reports through the CMS online system.
Further Information
For additional details, CMS has provided presentation slides, a webinar recording, and a transcript from a recent informational session.
