Grants management is now a strategic imperative for rural health leaders

The Centers for Medicare & Medicaid Services’ Rural Health Transformation (RHT) Program, which launched at the end of 2025, represents one of the most significant investments in rural healthcare in recent history. Designed to address longstanding disparities in access and care quality, the $50 billion, five-year program has the potential to support a vast array of state- and community-level initiatives to strengthen rural health systems.  

The challenge is making sure that these funds are managed effectively in compliance with complex federal requirements and in ways that deliver measurable outcomes for rural communities. Given the RHT Program’s short timelines and its requirement that states show progress each year to avoid funding reductions in future years, grants management has emerged as a linchpin of the program’s success. No longer simply an administrative task, it must become a strategic function that translates dollars into meaningful action—all while meeting federal compliance standards. 

Taming program complexity 

The RHT Program’s scale means that funding will flow to both rural health systems with more capacity and smaller providers alike. But without a strong grants management backbone at the state level, obligations can stall and audit findings can accrue. Plus, the clinical assets meant to stabilize rural care—including telehealth networks, maternal health access, and behavioral health capacity—risk remaining underpowered. 

The complexity of RHT Program funding can’t be overstated. States must administer multiple grant streams and subawards, each with distinct eligibility criteria, reporting requirements, and performance milestones. Subrecipients will range from university health systems to critical access hospitals and federally qualified health centers with limited administrative capacity.  

The sheer diversity of potential stakeholders and beneficiaries adds a layer of oversight complexity that only a disciplined grants function can manage. Effective grants management keeps funds aligned with authorized uses, mitigates risks before they materialize, and ensures that outcomes are tracked and verified rather than assumed. 
 

Core capabilities enabling success 

Given this complexity, states will need a clear action plan guided by a set of best practices and core capabilities. These fall into four broad categories. 

Governance. A strong governance structure is the foundation for success. States can benefit from a centralized office or project management function that oversees the portfolio, defines roles and responsibilities, standardizes processes, and serves as the single source of truth for reporting and compliance. Effective governance isn’t just about control. It’s about steering investments toward health outcomes. It requires clear escalation pathways to resolve issues, transparent decision logs, and conflict of interest policies that protect program integrity. 

It also benefits from clinical representation—including leaders from rural hospitals, emergency medical services, telehealth networks, and behavioral health providers—so that funding decisions reflect the realities of care delivery rather than abstract models. The governance structure should also drive a sustainability plan—identifying durable funding sources and self-sustaining approaches early on—so that successful programs endure beyond the five-year RHT Program window and continue delivering impact for rural communities. 

Compliance. Compliance with 2 CFR 200—the uniform guidance that serves as the government’s rulebook for managing federal grants—isn’t negotiable. These rules cover allowable costs, procurement integrity, subrecipient monitoring, audit readiness, and other critical aspects of program implementation. States should operationalize these requirements through clear policies, standardized templates, and capacity-building support for rural stakeholders.  

A compliance toolkit grounded in 2 CFR 200 provides templates and checklists for common tasks—procurement reviews, allowability assessments, and expenditure reconciliations—so that staff and subrecipients know exactly what “good” looks like. Risk-based monitoring is essential, too. Proactive measures such as fraud-risk assessments, eligibility verification workflows, and procurement pre-checks make compliance routine rather than crisis-driven. 

Technology. RHT Program funding and compliance complexity will exceed the capabilities of manual processes and legacy technologies. States that still rely on them should invest in digital platforms that support the full grant lifecycle—everything from application intake, scoring, and award issuance to subrecipient onboarding, invoice review, performance reporting, and closeout. 

Such systems should integrate with state accounting platforms to ensure transparency, accuracy, and reconciliation. The technology should also capture program metrics—such as telehealth utilization curves, behavioral health engagement rates, postpartum visit completions, and EMS response times—alongside fiscal data. This helps leaders see health impacts in real time and links them to each expenditure category. 

Stakeholder engagement. Grants management succeeds when rural stakeholders are partners rather than just recipients. Engagement increases the likelihood that priorities will reflect local needs, not just statewide models. States should clearly communicate funding aims, publish transparent timelines, and offer technical assistance during application windows. Training, office hours, and help desk resources matter because many rural stakeholders don’t have grants staff. Ongoing engagement during monitoring—through site visits, virtual check-ins, and data-sharing touchpoints—builds trust, surfaces barriers early, and supports course corrections. 

The grants management lifecycle 

Those core capabilities will enable project success only if they’re integrated into the entirety of the RHT Program implementation process. That process consists of four distinct phases, each requiring its own rigorous risk-management plan. 

1. Preparation 
   Before a single grant dollar is spent, states should finalize governance charters, adopt compliance policies tied to 2 CFR 200, and deploy the technology required to accept applications and track performance. Preparation also includes defining outcome metrics and eligibility rules that connect funding to rural health priorities. These can include increasing access to maternal care, expanding behavioral health services, stabilizing emergency and inpatient coverage at critical access hospitals, and strengthening community-based preventive care. 
   
   Recommended risk management actions: Conduct fraud-risk assessments that consider program type, applicant capacity, and historical audit findings. 
   
   
2. Execution 
   Execution begins with launching competitive application cycles, managing reviews, and issuing awards. Data-driven scoring improves fairness and transparency while helping reviewers consistently weigh grantee readiness, health impact, and long-term viability. Award letters should set explicit expectations for reporting, documentation, and performance milestones. 
   
   Recommended risk management actions: Reinforce controls through well-defined award terms and grantee compliance training. 
    
3. Monitoring 
   Monitoring should be continuous and risk-balanced. Financial reviews validate allowability and proper coding. Program reviews show whether outcomes are on track. Dashboards should connect fiscal and program data so that leaders can see emerging trends and adjust strategies—reprogramming funds toward telehealth adoption in counties where uptake lags, for example, or bolstering recruitment where staffing shortfalls threaten service continuity. 
   
   Recommended risk management actions: Deploy anomaly detection, risk-based monitoring, and targeted reviews. 
   
   
4. Closeout 
   In this final phase, states validate outcomes, reconcile funds, and prepare audit files in accordance with 2 CFR 200. They also synthesize lessons learned so that they can apply them to subsequent funding cycles. A well-structured closeout includes final performance reports, expenditure summaries, procurement records, and program impact documentation. 
   
   Recommended risk management actions: Validate end-to-end integrity; document final program spending and outcomes. 

Capacity building is vital across all lifecycle phases, especially since many rural providers and community organizations have limited administrative infrastructure. States can reduce burdens on these stakeholders in a few concrete ways, including: 

• Offering standardized invoicing tools, procurement templates, and documentation guides  
• Creating a shared resource library with model policies, reporting calendars, and compliance checklists 
• Hosting cohort-based learning sessions where peers troubleshoot issues 
• Funding technical assistance that supports grant administration as part of program delivery 

A clear path forward

States that consistently succeed with complex health funding share a set of habits that are practical, repeatable, and adaptable. They begin with governance that is both disciplined and inclusive, operationalize compliance through clear routines and risk-based monitoring, treat technology as a core enabler of health impact, and invest in stakeholder engagement as an ongoing partnership. They also design the program lifecycle so that preparation locks in success and closeout tells a complete story. And they plan for the long term by embedding reimbursement pathways and workforce strategies into every investment to support enduring positive outcomes. 

The RHT Program is a once-in-a-generation opportunity to improve healthcare in rural communities. The work will succeed when states treat grants management as a strategic imperative that’s underpinned by clinical insight and lasting partnerships with rural stakeholders. When dollars are tied to documented results and managed through systems that are transparent, practical, and inclusive, rural communities reap the benefits through better access, quality, and continuity of care.