RAPIDS CITY, S.D. — Echo Kopplin wants South Dakota leaders to know money from the new $50 billion federal rural health fund is meant to help residents with limited mobility.
Kopplin, a physician assistant who works with the elderly, low-income and mentally ill in the rural Black Hills, shared her thoughts at a meeting organized by state officials.
South Dakota leaders “did a good job” and asked questions to “get to the root of the problem,” she said.
Kopplin later told KFF Health News how one of her rural patients recently missed two appointments due to a broken car and lack of access to public transportation.
Across the country, health care professionals like Kopplin and thousands of others — from patient advocates to technology executives — flocked to town halls or online portals during the seven weeks that state leaders were required to prepare and submit their Rural Health Transformation Program applications to the federal Centers for Medicare and Medicaid Services. This deadline was November 5th.
“We will have committed $50 billion by the end of the year,” CMS Administrator Mehmet Oz said Nov. 6 at a Milken Institute event in Washington. He said all 50 states have applied.
The program “will allow us to right-size the health care system,” Oz said, adding that innovations from rural areas “will spill over into suburban and urban America as well.”
Among the applications and summaries publicly distributed by states, topics include workforce development, telehealth and access to healthy food. In Kansas, leaders want to create a Food is Medicine program. Wyoming officials are proposing a new program called BearCare, a state-sponsored health insurance plan that patients can use only after a medical emergency.
But many health policy experts and Democrats are sounding the alarm that the Republican-backed program will become a slush fund. Critics are concerned that the program will fail to reach small-town patients who they say need it most, especially as states face nearly a trillion-dollar cuts to Medicaid over the next decade. Medicaid, a joint federal-state program, covers nearly 1 of 4 rural Americans.
“The status quo is causing enormous anxiety in rural communities,” said Heather Howard, a professor of practice at Princeton University and director of the university's Public Health Strategies and Values program, which monitors the Rural Health Foundation. The new funding won't be enough to offset Medicaid losses, she said.
Congressional Republicans added the five-year, $50 billion Rural Health Transformation Program as a last-minute sweetener to President Donald Trump's sweeping tax and spending legislation. The move helped win support for the One Big Beautiful Bill Act from conservative opponents who worried that cuts to the Medicaid bill would harm rural hospitals in their states.
In Montana, where an online public forum was held prior to the application, the director of a nonprofit organization presented peer support for youth as a way to combat high suicide rates. A registered nurse asked state leaders to “think maybe even bigger” and consider universal health care statewide.
And in Georgia, a high-tech network of primary care clinics serving older adults proposed expanding its operations to the state in an online public comment. The rural grant writer asked for “safe and stable housing.”
The law states that half of the $50 billion will be divided equally among all states that submit an approved application. The rest will be distributed according to a point system. From second half$12.5 billion will be allocated based on rural areas in each state. The remaining $12.5 billion will go to states that good score about initiatives and policies that partially reflect the policies of the Trump administration.Make America Healthy Againgoals.
Top Senate Democrats have expressed alarm about the rural health care program. Among them are Ron Wyden from Oregon and Tina Smith from Minnesota, who called a federal watchdog agency to investigate the fairness and use of the fund. Taylor Harvey, an aide to Wyden, said the Government Accountability Office has confirmed it will investigate.
According to federal lawAt least a quarter of states that submit an approved application can share the second half of the funding each fiscal year, according to CMS spokeswoman Katherine Howden. The agency plans to publish brief descriptions of approved government projects. according to CMS manual.
Several conservative states, including Texas, Arkansas, Louisiana and Oklahoma, have already taken regulatory and legislative initiatives, such as banning “non-nutritive” food items in benefit programs that score extra points while using the program.
Michael Chamades, a county executive in rural New York, said he fears the money could be “used in a way that will harm certain states or reward certain states.” Chamides is also the director of communications and policy for the Rural Democracy Initiative, a national advocacy organization that has published rural action report last month.
Edwin Park, a research professor at Georgetown University's Center for Children and Families, said federal lawmakers gave Oz and his agency “truly excessive discretion” in awarding the money.
Federal administrators have added rules that are not part of the law that created the program, Park said. For example, the application rules say states cannot use more than 15% of their funding to pay patient care providers — payments that are expected to suffer due to Medicaid cuts.
Georgetown health policy experts and Democrats aren't the only ones concerned. Some Republicans And small hospitals In Ohio, there is concern that the money will go to large health systems rather than smaller independent hospitals that serve people in rural communities.
CMS's Oz repeated the idea of ”big hospitals taking over smaller facilities” at a meeting in Washington after the applications were submitted. He used similar language at a rural health summit hosted by Sanford Health in South Dakota. “How do we get larger hospitals to take over smaller hospitals? Not to take control of them, but to keep them viable by giving them good telemedicine services, specialized support, radiology support,” he said at the October event.
Sanford owns or operates dozens of hospitals and hundreds of clinics and long-term care centers, as well as a health insurance company. The system reported operating income of approximately $81 million for the first six months of fiscal 2025, according to the company. recent bond rating report.
Last year, Sanford opened a “command center” for its system-wide telehealth initiative. The company began expanding telemedicine in 2021 and offers virtual care in 78 medical specialties, according to Sanford President and CEO Bill Gassen.
“We tried to imagine what if that number doubled?” – said Gassen. The upfront costs of telehealth are high, he said, and the rural fund could be a unique opportunity “for us to make virtual care available to more patients, more communities, more hospitals and health systems across the country.”
Gassen, who will become chairman of the American Hospital Association in 2027, said Sanford leaders met with state and federal government officials, including Oz, whom he has known for years, and Chris Klomp, CMS chief deputy and senior adviser to Health and Human Services Secretary Robert F. Kennedy Jr.
The word “telehealth” appears 36 times in the 124-page rural health program application guide. But Don Robbins Jr., who runs a small hospital on the Illinois-Kentucky border, scoffed at the idea of using the funding for that purpose.
Robbins, whose 25-bed Massac Memorial Hospital sees an average of five to seven patients daily, said his hospital does not regularly offer telemedicine. Even if it were, patients living more than a mile outside the city wouldn't be able to use it because they don't have a good internet connection, he said.
In September, the small hospital reported a loss of $31,314, Robbins said. “I think if we get anything out of this,” Robbins said of the rural health program, “we’ll be lucky.”
Kopplin, a physician assistant who attended the South Dakota meeting, is cautiously optimistic about the rural health fund. She sees this as a great chance for states to test ideas and learn from what works and what doesn't.
But, she said, “in many ways, this bill will only be a stopgap” for rural health care. “It’s not really going to solve the problem.”
