Governor Abbott announces historic $1.4 billion investment for rural Texas hospitals
AUSTIN - Texas is receiving a historic investment of $1.4 billion in federal funding over five years to help rural health care throughout the state, according to an announcement by Governor Greg Abbott.
Federal funding for the "Rural Texas Strong" plan
What we know:
The Centers for Medicare & Medicaid Services (CMS) notified the Texas Health and Human Services Commission (HHSC) that it is receiving funding through the Rural Health Transformation Program.
As part of the One Big Beautiful Bill Act, the program is allocating $50 billion to states over five years to help transform rural health care. Texas will receive $281 million each year for five years, the most of any state in the program.
Texas submitted its application, "Rural Texas Strong: Supporting Health and Wellness," to CMS in early November.
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The Texas Health and Human Services Commission is pursuing $50 billion in federal funding to save and expand rural healthcare services as 76 rural hospitals face closure across the state.
RHT Program funding usage
Dig deeper:
The CMS website states that the funds from the RHT program must be used for three or more of the following approved uses of funds.
- Promoting evidence-based, measurable interventions to improve prevention and chronic disease management.
- Providing payments to health care providers for the provision of health care items or services, as specified by the Administrator.
- Promoting consumer-facing, technology-driven solutions for the prevention and management of chronic diseases.
- Providing training and technical assistance for the development and adoption of technology-enabled solutions that improve care delivery in rural hospitals, including remote monitoring, robotics, artificial intelligence, and other advanced technologies.
- Recruiting and retaining clinical workforce talent to rural areas, with commitments to serve rural communities for a minimum of 5 years.
- Providing technical assistance, software, and hardware for significant information technology advances designed to improve efficiency, enhance cybersecurity capability development, and improve patient health outcomes.
- Assisting rural communities to right size their health care delivery systems by identifying needed preventative, ambulatory, pre-hospital, emergency, acute inpatient care, outpatient care, and post-acute care service lines.
- Supporting access to opioid use disorder treatment services, other substance use disorder treatment services, and mental health services.
- Developing projects that support innovative models of care that include value-based care arrangements and alternative payment models, as appropriate.
- Additional uses designed to promote sustainable access to high quality rural health care services, as determined by the Administrator.
Texas healthcare fund usage
What they're saying:
Governor Abbott's office states that the HHSC will use the Texas funds for a competitive process to allocate funds for the following:
- Offer grants to reduce chronic disease through prevention, wellness and nutrition services.
- Invest in consumer-facing technology to engage with patients on improving their health.
- Deploy artificial intelligence and telehealth services to bridge service gaps.
- Recruit and retain rural health care workers through career development, scholarships, relocation payments, and training programs.
- Improve cybersecurity defenses to protect patient data.
- Upgrade equipment in rural hospitals and clinics.
"Rural Texans across the state will benefit from this historic federal investment. We will strengthen our rural hospitals, expand access to critical mental and physical health care, and help reduce chronic disease through wellness and nutrition initiatives," said Governor Abbott. "I thank President Trump, Secretary Kennedy, and Administrator Oz for their efforts to improve rural health care for Texans and all Americans."
Cecile Erwin Young, executive commissioner of Texas Health and Human Services, spoke on the federal funding that should be received in 2026, shortly after Young's retirement on Jan 2, 2026.
"We are grateful for the federal government’s investment in increasing access to preventive and lifesaving care for people who live in rural communities across the state," said Young.
"Thanks to the input and partnership of our rural healthcare stakeholders, Texas now has the opportunity for innovative and tailored solutions that will improve health care for current and future generations of Texans."
Eligibility and Application Timeline
What's next:
Local governments, rural hospitals, rural federally qualified health centers, rural behavioral health providers, and other qualified applicants will be eligible to apply for funding in the spring. More information will be available on the HHSC Grants website.
For more on how HHSC is supporting rural hospitals, visit the HHSC website.
The Source: Information in this article was provided by Governor Greg Abbott's Press Office and cms.gov.