Each state’s $100 million base allocation is available, but its competitive award is delayed. States must submit budget revisions to the federal agency by 30 November.
The Centers for Medicare & Medicaid Services (CMS) has delayed the competitive portion of states’ 2027 Rural Health Transformation Program awards. In an October 30 email, Alina Czekai, director of the agency’s Office of Rural Health Transformation, told states that each state’s second-year base funding of $100 million was available but the competitive amounts were delayed.
States had expected their award amounts by October 31 under the original federal notice. Czekai gave no replacement announcement date and said officials had discovered an additional administrative process requirement and were working to resolve it quickly.
Kentucky confirmed the delay on 2 November, KFF Health News said. State health agency spokesperson Beth Fisher said Kentucky’s rural funding was intended to lessen the effects of expected reductions in federal Medicaid funding.
The program provides for $10 billion a year in state awards for five years. A federal scoring process, revisited annually, determines the allocations. Michael Baker, healthcare policy director at the center-right American Action Forum, said the criteria included expanding the rural health workforce and adopting the presidential fitness test for schoolchildren. He said he was not surprised that calculating second-year awards appeared more complicated than the office had anticipated.
First-year awards were announced in late 2025. States then had eight months to revise budgets, begin spending and document expenditures; their first annual progress reports were due by the end of August 2026.
KFF Health News obtained more than half the states’ first-year progress reports. First-year funds have gone to rural hospitals, clinics, ambulance services and other local organizations, as well as management and technology consultants. In Nevada, the Northern Nye County Hospital District received a $1.3 million grant to reopen a primary care clinic.
Berlin police and prosecutors have opened an investigation after Aiwanger was found dead in a hotel on 4 November. The cause of death was not immediately clear. Prosecutors said provisional autopsy findings showed no indication of a potential crime or external foul play, and further forensic investigations would continue.
Colorado’s deputy Medicaid director, Cristen Bates, warned in August that judging second-year awards on an incomplete implementation period would produce inaccurate evaluations of state and program performance.
Officials from five states estimated that annual reporting would take approximately 120 hours. CMS said it had worked to reduce the burden and estimated that each state’s initial annual report would take 80 hours.
Baker called on federal officials to publish explanations of states’ successes and areas for improvement, rather than award amounts alone. Under Czekai’s email, states’ budget revisions prompted by the new allocations remain due to CMS by 30 November.
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