Rural Health Transformation Program: Early Implementation Actions and Monitoring Plans

It can be hard for people living in rural areas to get the health care they need. In 2025, a federal law established the Rural Health Transformation Program to fund state activities—like recruiting clinicians to rural areas.

The Centers for Medicare & Medicaid Services administers the program, which will provide up to $50 billion to states over 5 years. In its first year, CMS gave $10 billion to 50 states.

This Q&A report looked at what CMS did to implement the program and its plans to monitor states’ activities. For example, CMS plans to communicate with states to discuss progress and conduct audits and site visits.

Person using a stethoscope on an elderly person

The Rural Health Transformation program provides funding for states to conduct rural health activities, such as recruiting clinicians to rural areas and providing training and technology to improve care delivery in rural hospitals. In the latter half of 2025, the Centers for Medicare & Medicaid Services (CMS) completed a number of early key actions to implement the Rural Health Transformation program. These actions included the release of the notice of funding opportunity—which provided details on program goals and requirements—and initial funding awards to all 50 states totaling $10 billion. The initial allotment of state funding ranged from $147 million for New Jersey to $281 million for Texas. CMS and merit reviewers assessed state applications based on a variety of factors—such as rural characteristics (e.g., total area in square miles and percent of population in rural areas) and the strength of states’ proposed initiatives. As a result, funding amounts variedacross states.

Rural Health Transformation Program Funding, by State, Budget Period 1 (December 29, 2025, Through October 30, 2026)