Another $10 billion is on its way to support rural healthcare!
On November 9, 2026, the Centers for Medicare & Medicaid Services (CMS) announced the second round of Rural Health Transformation Program (RHTP) awards, with all 50 states receiving funding. That brings the total awarded so far to $20 billion through the five-year program.
It’s exciting to see this investment in rural communities continue. With the program now entering its second year, there’s plenty to pay attention to. States are moving forward with their transformation plans, and the latest awards offer a closer look at how funding is being distributed as that work progresses.
So, how much did each state receive, and what does this next round of funding mean for rural hospitals? Let’s take a look.
How Much RHTP Funding Did Each State Receive for Year 2?
All 50 states received funding for the second year of the Rural Health Transformation Program, with awards ranging from approximately $142 million to $282 million.
Texas received the largest Year 2 award at nearly $282 million, slightly more than its $281.3 million award last year. Alaska followed at $272.7 million, also seeing a small increase. Montana and Oklahoma received larger increases of approximately $6.2 million and $3.6 million, respectively, while California’s award decreased by about $2.5 million.
Each state is guaranteed $100 million in annual baseline funding. The remaining $5 billion is distributed based on several factors, including each state’s rural healthcare needs and its transformation plans. For Year 2, CMS also considered states’ progress in putting those plans into action.
RHTP Year 1 vs. Year 2 Awards by State
All amounts in millions of dollars (USD)
State | Year 1 (FY 2026) | Year 2 (FY 2027) |
Alabama | $203.4M | $199.3M |
Alaska | $272.2M | $272.7M |
Arizona | $167.0M | $165.0M |
Arkansas | $208.8M | $207.8M |
California | $233.6M | $231.1M |
Colorado | $200.1M | $197.2M |
Connecticut | $154.2M | $153.7M |
Delaware | $157.4M | $160.3M |
Florida | $209.9M | $203.8M |
Georgia | $218.9M | $221.7M |
Hawaii | $188.9M | $189.6M |
Idaho | $186.0M | $182.7M |
Illinois | $193.4M | $190.5M |
Indiana | $206.9M | $208.9M |
Iowa | $209.0M | $216.0M |
Kansas | $221.9M | $225.9M |
Kentucky | $212.9M | $211.3M |
Louisiana | $208.4M | $211.9M |
Maine | $190.0M | $190.4M |
Maryland | $168.2M | $168.4M |
Massachusetts | $162.0M | $158.4M |
Michigan | $173.1M | $170.6M |
Minnesota | $193.1M | $190.8M |
Mississippi | $205.9M | $204.7M |
Missouri | $216.3M | $218.5M |
Montana | $233.5M | $239.7M |
Nebraska | $218.5M | $219.2M |
Nevada | $179.9M | $182.4M |
New Hampshire | $204.0M | $204.3M |
New Jersey | $147.3M | $142.3M |
New Mexico | $211.5M | $211.0M |
New York | $212.1M | $207.8M |
North Carolina | $213.0M | $216.8M |
North Dakota | $198.9M | $206.4M |
Ohio | $202.0M | $201.9M |
Oklahoma | $223.5M | $227.1M |
Oregon | $197.3M | $197.3M |
Pennsylvania | $193.3M | $190.7M |
Rhode Island | $156.2M | $158.2M |
South Carolina | $200.0M | $196.0M |
South Dakota | $189.5M | $187.7M |
Tennessee | $206.9M | $210.3M |
Texas | $281.3M | $282.0M |
Utah | $195.7M | $191.9M |
Vermont | $195.1M | $190.0M |
Virginia | $189.5M | $195.7M |
Washington | $181.3M | $177.1M |
West Virginia | $199.5M | $202.1M |
Wisconsin | $203.7M | $203.7M |
Wyoming | $205.0M | $207.2M |
Total | $10 billion | $10 billion |
Sources: CMS Year 2 announcement and RHTP state-by-state comparison. Figures are rounded, so apparent differences may vary slightly from changes calculated using exact awards.
One thing to keep in mind is that this funding goes to the states first, not directly to rural hospitals. Each state has its own plan for how the money will be used, so hospitals will need to look at what’s available in their state to see where they might be able to get involved.
What Changed Between RHTP Year 1 and Year 2?
One of the biggest differences in this year’s awards is how CMS is taking states’ progress into account.
During Year 1, states focused on getting their transformation plans off the ground. That meant building partnerships, developing projects, and preparing to put funding to work in rural communities.
Now, CMS is looking more closely at how those plans are coming along.
Year 2 Awards Reflect States' Progress
All 50 states submitted annual reports documenting their first year of work, which CMS reviewed when determining the second round of awards.
But progress doesn’t necessarily mean a project is already producing measurable results. CMS also considers important steps along the way, such as getting project plans approved, launching initiatives, and establishing ways to measure their impact.
That’s encouraging for rural communities! Meaningful improvements take time, especially when hospitals are working with limited staff and resources. The program recognizes that laying the groundwork is an important part of making those improvements possible.
Why Did Some States Receive More or Less Funding?
Although every state received another award, the amounts weren’t the same as Year 1.
The changes were relatively small. North Dakota saw the largest increase, receiving about $7.4 million more than last year, while Florida saw the largest decrease, at about $6.1 million.
Several factors go into how much funding each state receives, so a smaller award doesn’t necessarily mean a state isn’t making good progress.
The key point is that funding amounts can change each year. As states continue implementing their plans, demonstrating progress will remain part of how CMS determines future awards.
Related: Year 1 and Year 2 award comparison
What Does RHTP Year 2 Funding Mean for Rural Hospitals?
With another $10 billion awarded, there’s a lot to look forward to for rural healthcare. But what does this announcement actually mean for hospitals?
For many, the work is already underway. States have spent the first year developing their plans and putting projects into motion. Now, the second round of funding allows them to build on that progress.
Depending on the state, that could mean expanding access to specialty care, investing in new technology, or helping rural hospitals strengthen their financial footing.
Are There Still RHTP Funding Opportunities for Rural Hospitals?
For hospitals that haven’t been involved in an RHTP project yet, there may still be opportunities ahead!
Because the program is managed at the state level, each state determines how funding is distributed through its approved initiatives. Some may have additional grant opportunities or application periods, while others are focused on projects that have already been selected.
We encourage rural hospital leaders to stay connected with their state RHTP teams and watch for upcoming opportunities.
Whether your hospital is just getting started or already putting funding to work, these projects have strong potential to make a lasting difference in rural communities.
Related: CMS RHTP Fact Sheet
Why Reporting and Measuring Progress Matter More in RHTP Year 2
With the second year of funding underway, CMS is paying closer attention to how states are putting their RHTP investments to work.
States also have new reporting requirements this November. Along with their annual reports, they’ll now provide quarterly updates so CMS can see what’s been accomplished and what’s still in progress.
For rural hospitals participating in these projects, reliable data is especially valuable.
Start With a Clear Picture of Where You Stand
It’s hard to show improvement if you don’t know where you started.
Let’s say a rural hospital is using RHTP funding to improve its revenue cycle. Before making changes, the team could look at its current denial rate and how much revenue is tied up in denied claims.
As new processes are introduced, those same measurements can help the hospital see what’s improving and where more work may be needed.
And while every RHTP project will have different goals, the idea is the same. Establishing a baseline gives your team something meaningful to measure progress against.
Make Reporting Part of the Work, Not an Afterthought
We know rural hospital teams already have plenty on their plates. Adding another reporting requirement can feel like one more thing to manage.
That’s why it’s helpful to think about measurement early, rather than waiting until a report is due.
When hospitals understand what information their projects need to track, they can build those measurements into their regular workflows. It also helps to work with partners who understand federal reporting requirements and can make the process easier on hospital staff.
There is also value in tracking this information beyond meeting CMS requirements. Hospitals can use it to see what’s working and figure out where they may need to make changes along the way.
How Can Rural Hospitals Make RHTP Investments Last Beyond the Funding?
One of the most exciting things about RHTP is the opportunity to make improvements that rural communities will benefit from for years to come.
But with the program scheduled to end in 2030, hospitals also need to consider what happens when grant funding runs out.
The good news is that sustainability doesn’t have to wait until the final year. Hospitals can start planning for it while their projects are still taking shape.
Think About What It Will Take to Keep a Project Going
A new technology system might be covered by grant funding today, but what about the annual licensing fees? Or the staff time needed to maintain it?
These are important questions to ask early.
We’ve seen how helpful it can be when hospitals look beyond a project’s initial cost and consider what they’ll need to keep it running. In some cases, improvements may create efficiencies or financial benefits that help offset those ongoing expenses.
Understanding those costs and potential benefits gives hospital leaders a better idea of what’s realistic for the future. We explore this further in our blog, Will Your RHTP Projects Survive When the Grant Money Stops?, including ways hospitals can start planning for sustainability while funding is still available.
Give Your Team the Tools to Continue the Work
Some of the most valuable improvements aren’t tied to a piece of technology. They come from helping hospital employees understand their data and use it to make better decisions.
We’ve seen this firsthand in our work with rural hospitals. When leadership is engaged and frontline employees have a voice in the process, they’re often better equipped to sustain improvements.
Training is an important part of that, too. Clear processes that existing employees can use and new employees can learn help keep the work going, even as staffing changes.
Ultimately, the goal isn’t simply to complete an RHTP-funded project. It’s to leave the hospital in a stronger position to serve its community long after the funding ends.
What's Next for the Rural Health Transformation Program?
With Year 2 awards announced, states will continue putting their approved transformation plans into action. For some, that means moving existing projects forward. Others may be preparing to launch new initiatives or open additional funding opportunities for rural healthcare organizations.
And there’s still more funding to come!
The Rural Health Transformation Program will provide annual awards through fiscal year 2030, with $30 billion remaining to be awarded over the next three years. States will continue reporting on their progress, and CMS will use that information to help determine future funding amounts.
If your hospital is interested in getting involved, keep an eye on how your state is using its RHTP funding. Each state is moving at its own pace, and more opportunities to participate may arise as new projects get started.
We’re excited to see how these investments continue taking shape and what they’ll mean for the rural communities counting on them.
Looking Ahead to Another Year of Rural Health Transformation
It’s encouraging to see another $10 billion dedicated to strengthening rural healthcare. And as states continue putting their plans into action, we’re looking forward to seeing how these investments make a difference in communities across the country.
At REDi Health, we believe some of the best opportunities come from helping rural hospitals make the most of the resources they already have. Whether that means improving financial performance or measuring the impact of a new initiative, we’re always excited to help hospitals turn good ideas into lasting improvements.
If your hospital is exploring an RHTP project or looking for ways to measure its progress, we’d love to talk.
