What states are prioritizing with their first year of Rural Health Transformation funding

In the first year of the Rural Health Transformation Program (RHTP), states have homed in on a few core themes designed to improve the nation’s rural health infrastructure.

The RHTP was established under the One Big Beautiful Bill in response to backlash over Medicaid cuts included in the legislation. It allocates a total of $50 billion across all states over five years, to be used on various initiatives tackling issues plaguing patients living in rural areas. States received between $147 million (New Jersey) and $281 million (Texas), with amounts depending on factors including rural population size and number of existing rural health facilities in the state.

Paula Chatterjee, an assistant professor of medicine at the Perelman School of Medicine and director of innovation at the Leonard Davis Institute of Health Economics at the University of Pennsylvania, told Healthcare Brew the main areas she’s seeing states prioritize include maternal health, substance use disorder treatment, and telehealth.

Let’s get into it.

Maternal health. In the US, more than half of rural areas (59%) are considered maternal health deserts, according to 2024 March of Dimes data. Maternal health deserts are areas with no hospitals offering obstetric care, no birth centers, and no ob-gyns or certified midwives.

“I’m seeing a lot of novel approaches to think about maternal health care delivery to remote settings,” Chatterjee said. “Can we use community health workers, can we use doulas in different ways to really reach folks in hard to reach places where access might otherwise be a challenge?”

New Mexico, for example, which received roughly $211 million in RHTP funds for 2026, launched Healthy Horizons, an initiative that will select six organizations to manage regional hubs around the state to bring maternity and other care closer to those living in rural areas, according to Elisa Wrede, acting rural health director of the New Mexico Health Care Authority. Applications to be one of these organizations closed on July 6.

“We have huge maternal health deserts in New Mexico,” she said.

Substance use treatment. According to a 2023 study from the East Tennessee State University/NORC Rural Health Equity Research Center, people living in rural areas are 4.5x more likely to be admitted, via a court order or law enforcement, to inpatient treatment programs, yet 9x less likely to have access to buprenorphine, a commonly used medication to treat substance use disorder (SUD).

Minnesota is one state planning to use part of its RHTP funds (it received $193 million for 2026) to set up a tele-buprenorphine access line. This would “allow Minnesota to build a centralized and sustainable statewide access system to address persistent access gaps in rural communities,” according to the state’s grant website.

Telehealth. Nearly all (92%) of rural counties faced primary care shortages, yet only 19% of rural residents accessed primary care via telehealth in 2023, compared to the national average of 29%, according to data from nonprofit healthcare research group the Commonwealth Fund.

Studies have shown that telehealth is an effective way to close access gaps, allowing people in rural areas to get care faster and reduce their travel burden.

“There’s some really interesting ways to try and embed telehealth into different places, again to sort of fix the access challenge and really provide patients with a point of care when they otherwise might not have one,” Chatterjee said.

For instance, Arkansas plans to spend roughly $28 million of its year-one funds (which total nearly $209 million) on a project called Lifeline, which would, among other things, set up emergency tele-triage platforms.

Funding for year two of the RHTP depends on whether states can prove they’re making progress in setting up their initiatives. They must also provide data that shows these programs are bettering rural care by August 30.