A sustainable path forward for rural healthcare

Earlier this year, the Centers for Medicare & Medicaid Services (CMS) announced the first round of funding through its Rural Health Transformation (RHT) program, which will deploy $50 billion to redesign rural healthcare delivery over the next five years.  

At Guidehouse’s 2026 Healthcare Innovation Summit, rural health leaders described the funding as an unprecedented opportunity—but emphasized that its success will depend on whether states and providers can turn short-term investment into sustainable, long-term change. 

That sentiment was persistent in a summit panel moderated by Guidehouse Director Kaajal Singh, who asked speakers about how they’re implementing RHT initiatives in their respective organizations and their thoughts about the program’s progress to date.  

Panelists included: 

• David Critchlow, Senior Vice President, Government Relations, Lifepoint Health 
• Elizabeth Kromm, PhD, Assistant Secretary for Population Health and Strategic Initiatives, Maryland Department of Health 
• Alan Morgan, CEO, National Rural Health Association 

Rural healthcare isn’t one-size-fits-all 

Created through the House Reconciliation 1 Act of 2025, or H.R. 1, the RHT program will deploy $10 billion per year to states over the next five years to improve rural healthcare delivery, with award amounts varying based on state proposals and need. This decentralized approach will result in variation in how funds are used, how grants are managed, and how much funding ultimately makes it way to provider organizations.  

While this allows for local innovation that meets each state’s unique needs, it may create challenges for critical access hospitals with service areas that cross state lines and for multi-state health systems like Lifepoint, the largest operator of rural hospitals across the U.S.  

“We're in 35 states, and every state is different in how they're running this program. It's very difficult to manage that,” Critchlow said, adding that slow implementation in some states could lead the federal government to reclaim funds.  

According to Critchlow, that variation has also meant that funding from the program isn’t consistently making its way directly to rural providers. He said Lifepoint hospitals have only received grant funding in four of the thirty-five states the company operates in. 

Maryland’s collaborative approach 

In Maryland, where 18 out of 24 counties qualify as rural, the approach is intently focused on each rural community’s unique needs, said Kromm. Her team used listening sessions and an informational request process to shape priorities that ultimately centered on workforce, mobile health, food systems, and healthcare access. The state has placed significant focus on access-related projects, including competitive grant opportunities to form clinically integrated networks, value-based care models, and other care delivery-focused initiatives. 

For mobile health and food programs, Maryland is giving rural communities flexibility to articulate how they’ll address their specific needs instead of solely implementing statewide initiatives. This will come through unified funding agreements that the state has with local health departments.  

“These are one-time infrastructure dollars, and we have to figure out a path to sustainability,” Kromm said. “We know we have a lot of need in our rural communities and must get these dollars out the door quickly.” 

Sustaining transformation 

Workforce remains one of the clearest constraints to rural healthcare transformation. Panelists noted that rural communities often struggle not only to recruit clinicians but also to train and retain people who understand rural care delivery. Morgan pointed to the mismatch between where clinicians are trained and where rural communities need them most, arguing that long-term workforce solutions must begin earlier in the education and residency pipeline. 

“Nothing is wrong with rural,” Morgan said. “We’re doing medical education wrong.” 

Panelists described technology as an important part of rural transformation while cautioning that AI, remote monitoring, and mobile health strategies still depend on workforce capacity, community trust, and reliable connectivity.  

“Connectivity is a huge issue,” Morgan said. “That's part and parcel for rural.”  

Partnerships will also shape whether the program delivers lasting value. Many rural providers have already established partnerships with neighboring health systems, community organizations, and technology partners to bring high-quality care to their communities.   

Lifepoint has partnered with academic health systems to bring tertiary center expertise to its rural hospitals across the country, including a joint venture with Duke Health formed in 2011. Critchlow said he is concerned that this may be at odds CMS’s vision for a hub and spoke model, which calls for rural hospitals to focus on ED and outpatient care and transfer patients to major urban facilities for inpatient care.  

“Our view of a hub and spoke has been partnering with large teaching hospitals, working together with partners and using technology to do our best to keep inpatient care in rural communities,” Critchlow said. 

Concerns about long-term viability have led Lifepoint leaders to avoid applying for funding tied to programs that they don’t believe can continue beyond the five-year funding window, Critchlow said. They worry that rural hospitals could be encouraged to launch new service lines or initiatives only to be faced with the difficult decision of closing them when the money runs out. Funding that looks attractive in year one may become a liability if it adds costs, complexity, or workforce needs that rural providers can’t maintain. 

As states continue implementing RHT dollars and prepare for the next round of funding proposals, early results will shape the program’s next phase. Implementation data will be critical to redirecting funding, refining grant processes, and determining which models should be carried forward over the remaining four years.