Trump Administration Launches $ 50 Billion Rural Health Transformation Program

Michigan will receive $ 173 million:

https://www.michigan.gov/mdhhs/inside-mdhhs/newsroom/2025/12/30/rht-funding

Michigan awarded more than $173 million in federal funding to strengthen rural health
By Lynn Sutfin - December 30, 2025

Funding comes from Rural Health Transformation Program

LANSING, Mich. – This week, the Michigan Department of Health and Human Services (MDHHS) was awarded $173,128,201 for FY 2026 by the Centers for Medicare & Medicaid Services under the Rural Health Transformation Program.

“Today’s investment will support access to health care for rural communities across Michigan as we deal with funding shortfalls caused by federal Medicaid cuts,” said Gov. Gretchen Whitmer. “This $173 million grant will help us connect more Michiganders to the care they need and provide essential wraparound supports. In Michigan, we have successfully worked together to protect quality, affordable health care, and we will continue finding ways to secure more federal funds, expand coverage and lower costs.”

The Rural Health Transformation Program is a $50 billion national commitment to improve the health and well-being of rural communities across the country. With this funding, states will implement comprehensive strategies to improve care delivery, support providers and advance new approaches to coordinating health care services across rural communities. Funding will be allocated over five years, with $10 billion available each year from 2026 through 2030.

“Michigan continues to support a resilient and innovative rural health system where every resident has access to high-quality care close to home,” said Elizabeth Hertel, Michigan Department of Health and Human Services director. “Our approved proposal for these federal funds focuses on enhancing the long-term sustainability of rural providers while supporting their growth and continued service to their communities.”

Before submitting its application, MDHHS hosted an online survey and two listening sessions to gather input on how the funding could help increase and improve sustainability for rural providers.

Based on this feedback, MDHHS requested funding to:

• Support the development and strengthening of regional partnerships among rural hospitals, clinics and community organizations to improve care coordination, align service delivery, expand access points and promote financially sustainable care models.
• Recruit and retain rural health professionals, behavioral health providers and community health workers. Funds will also promote prevention and chronic disease management training and integrated behavioral health care access.
• Implement technology tools and advance rural interoperability, including establishing a rural technology catalyst fund to support expanding data exchange and increasing adoption of telehealth, remote patient monitoring and technology-driven care coordination tools.
• Establish digital referral networks that connect residents to local care, prevention and wellness resources needed to live healthy lives.

For more information about Michigan’s plan for the funding, visit the MDHHS Rural Health Transformation Program website. Additional information about the federal Rural Health Transformation Program is available at Rural Health Transformation Program | CMS.

MDHHS is now seeking Rural Health Transformation Advisory Council (RHTAC) members.  The MDHHS Rural Health Transformation Program is part of the federal One Big Beautiful Bill Act which was signed into law last year. The $ 50 billion grant program distributes $ 10 billion per year to the states through FY 2030.  The RHTAC will play some role in distributing the $ 173 million Michigan will receive this year:

https://www.michigan.gov/mdhhs/inside-mdhhs/newsroom/2026/01/13/rht-advisory-council

MDHHS seeks applicants to serve on Rural Health Transformation Advisory Council
By Laina Stebbins - January 13, 2026

LANSING, Mich. – The Michigan Department of Health and Human Services (MDHHS) is seeking members to serve on the Rural Health Transformation (RHT) Advisory Council. The advisory council will play a key role in supporting the successful implementation of Michigan’s RHT Program, which aims to strengthen rural health systems, improve access to services and support sustainable care for rural communities across the state.

MDHHS is looking for individuals and organizations with experience, insight and a strong commitment to improving rural health. Ideal candidates include leaders from community-based organizations, rural health providers, hospitals and clinics, behavioral health organizations, social service agencies, local public health departments, tribal partners and residents of rural communities.

Interested applicants can now apply online.

The RHT Advisory Council will:

• Support development of an engagement strategy to strengthen partner and community input throughout implementation and evaluation.
• Provide actionable guidance to MDHHS to inform decision-making and ensure the program remains responsive to rural communities.

MDHHS invites applications from individuals who:

• Represent or work closely with rural populations.
• Bring knowledge of rural health challenges, community needs or service delivery gaps.
• Demonstrate a commitment to collaborative problem-solving and inclusive partnership.
• Can participate in scheduled meetings and contribute to ongoing implementation activities.

Applicants will be selected to ensure balanced representation across Michigan’s rural counties and key stakeholder groups, including health care providers, public health and behavioral health organizations, community-based agencies, tribal health partners, academic institutions, and policy, payer and workforce development entities. Selection will prioritize individuals who demonstrate a clear understanding of rural health challenges and a strong commitment to advancing the mission and objectives of the RHT Program.

The council will convene on a quarterly basis, with additional sessions scheduled as needed. Each quarterly meeting will last approximately 60 to 90 minutes.

Questions during the application process should be directed to MDHHS-RHTP@michigan.gov.

Republicans in the Michigan House are dissatisfied with MDHHS' plan to distribute the $ 173 million in federal rural health care support funds.  There may be little they can do.  The MDHHS plan to distribute this kind of federal cash bonanza is not covered by PA 306 of 1969, The Michigan Administrative Procedure Act:

https://michiganadvance.com/2026/01/22/michigan-republicans-blast-state-plan-letting-populous-counties-vie-for-rural-health-funds/

Michigan Republicans blast state plan letting populous counties vie for rural health funds
By Jon King - January 22, 2026

Michigan House Republicans on Wednesday criticized the state Department of Health and Human Services over its plan to distribute just over $173 million in federal rural health care funding, arguing that eligibility rules improperly allow the state’s most populous counties to compete with sparsely populated ones.

The House Appropriations Committee heard testimony on a proposal for allocating money from the federal Rural Health Transformation program, a $50 billion program created by Congress in response to concerns by rural health care providers about the Medicaid cuts included in 2025’s One Big Beautiful Bill Act.

However, Michigan House GOP lawmakers objected to the department’s definition of “partially rural,” which would allow counties such as Wayne and Oakland to qualify for grants alongside counties in Northern Michigan and the Upper Peninsula.

“When Lansing talks about being ‘inclusive,’ too often it means Northern communities get left behind,” Rep. Cam Cavitt (R-Cheboygan) said in a press release. “For DHHS to suggest that Wayne County deserves rural funding is an insult to everyone who lives north of Clare.”

State health department officials said they will weigh multiple factors when awarding grants, including population and geographic isolation, to ensure funding reaches areas with the greatest need.

“I fully recognize that there are major differences between what’s available in a fully rural county or a partially rural county,” Beth Nagel, senior deputy director at MDHHS, told the committee. “And so we do plan to prioritize, based on not only population, but some of those other factors as well, completely understanding that there are differences, and we do want this funding to reach who it needs to impact, but we also want it to be as inclusive as possible. So it’s kind of walking that fine line.”

Cavitt said that under the department’s criteria, any county deemed rural or partially rural qualifies for funding, allowing entities within those counties to apply as long as proposals claim to support rural health care.

Rep. John Roth (R-Interlochen) questioned how small northern counties could compete under that structure.

“Are we really saying that the 22,000 people of Leelanau County must compete with Detroit for rural healthcare funding?” Roth asked in a press release. “Leelanau and Grand Traverse County are lumped into the same ‘partial rural’ category as Wayne, Oakland, and 13 others. I’ve driven through Northern Michigan, and I’ve driven through Detroit – there is simply no comparison.”

Roth further noted that residents in Wayne and Oakland counties have relatively immediate access to top-tier hospitals, while those living in smaller, northern counties often must drive more than an hour to receive basic care. He said the proposal reflected a “fundamental misunderstanding of rural Michigan.”

In response to the criticism, Lynn Sutfin, spokesperson for the state health department, told Michigan Advance in an email that the rural classifications in the state’s proposal mirror the definitions of the Federal Office of Rural Health Policy within the U.S. Health Resources and Services Administration.

“This broad definition of the term rural is meant to provide as many opportunities as possible for Michigan’s rural residents to benefit from the funds whether they reside in a county that is fully rural or partially rural,” Sutfin said, adding that the department anticipated prioritizing counties with a high prevalence of chronic disease, limited access to health care facilities, high Medicaid dependence and significant rates of child poverty or aging populations.

The state Department of Health and Human Services serves as a pass-through agency for the federal grants, which must be awarded and distributed by December.

Yoopers react:

https://www.uppermichiganssource.com/2026/01/26/rural-hospitals-react-federal-funding-changes/

Rural hospitals react to federal funding changes
Rural hospitals react to federal funding changes
By Dan Groeneveld - January 26, 2026

UPPER MICHIGAN (WLUC) - Changes to how federal healthcare funding is distributed is causing concern among U.P. rural hospitals.

Under the Rural Health Transformation Program, Michigan ranks 43rd out of all U.S. states for funding over the next five years.

Munising Memorial Hospital CEO Wendy Frush says without rural hospitals, rural communities fail.

“Rural hospitals are usually the hub of the community,” Frush said. “In order for there to be industry within rural areas, we need to have rural hospitals where people feel safe and where they get good quality care.”

The Rural Health Transformation Program was passed as part of what is known as the “One Big Beautiful Bill Act.” It’s intended to disperse $10 billion each year to rural hospitals across all 50 states.

But Frush says the Michigan Department of Health and Human Services has allowed hospitals that would not traditionally be considered rural to apply.

“Unfortunately, it looks like there’s been a shift to open up the terminology of what truly rural is, allowing for other organizations to come in and kind of apply for those grant funds,” Frush said.

She says U.P. hospitals will now be up against those from bigger areas. She foresees more staffing challenges and patients experiencing limited access to services.

The MDHHS says it adjusted its application system to support the full spectrum of rural healthcare. The department said in a statement that reads in part, “the rural classifications in our proposal mirror the definitions of the Federal Office of Rural Health Policy within the U.S. Health Resources and Services Administration. This broad definition of the term rural is meant to provide as many opportunities as possible for Michigan’s rural residents to benefit from the funds whether they reside in a county that is fully rural or partially rural.”

But U.P. Health System-Marquette says rural communities are being left behind. The hospital said in a statement that reads in part, “it’s deeply concerning that rural patients and rural communities like ours were not prioritized in the state’s Rural Health Transformation Program. The program was created by Congress to help rural patients maintain access to services. We still plan to work with the state on the program and hope the U.P. will not be overlooked when funds are distributed.”

Frush says she wants legislators to advocate more for rural hospitals.