Florida will receive $203.8 million in the second year of a federal program intended to improve healthcare in rural communities, the Centers for Medicare & Medicaid Services announced Monday.
That's about $6.1 million less than Florida received in the program's first year, when it was awarded $209.9 million. The second-year allocation represents a decrease of about 2.9%, the largest dollar decline among the 50 states.
The Rural Health Transformation Program, established by Congress in 2025, provides $50 billion over five years to help states improve access to healthcare and strengthen rural health systems.
The federal government distributes $10 billion annually among all states, with half divided equally and the other half allocated based on factors that include rural populations, healthcare facilities, proposed initiatives and progress implementing state plans.
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The funding is not limited to rural hospitals. States can use it for workforce recruitment and retention, preventive care, behavioral health services, technology and new approaches to delivering care.
Texas received the largest second-year award, nearly $282 million, followed by Alaska with $272.7 million and Montana with $239.7 million. New Jersey received the smallest allocation, about $142.3 million. North Dakota had the largest year-over-year increase, gaining $7.4 million. Overall, 25 states received more than in the first year and 25 received less.
CMS records show Florida made no commitments to pursue any of the program's 19 state policy actions, which include changes involving healthcare licensing, providers' scope of practice, nutrition education and telehealth. Florida already had several of those policies in place when it applied for the funding.
CMS considers progress on those policy actions, along with implementation of states' proposed initiatives and other factors, when determining the awards. The agency has not disclosed how much weight it gave each factor.
The second-year grants follow the submission of annual reports by all 50 states documenting progress during the program's first year. The initiative is intended to support longer-term changes in rural healthcare rather than provide short-term operating assistance to individual providers.
"States have already put these resources to work bringing better care closer to home for their rural communities," CMS Administrator Dr. Mehmet Oz said in announcing the latest awards. "CMS looks forward to helping them build on that progress in the coming year."
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The funding comes as rural health providers face another challenge: reductions in federal Medicaid spending under the same law that created the rural health program. Those cuts are projected to reduce federal Medicaid spending by substantially more than the $50 billion allocated for rural healthcare over the next decade.
Federal officials missed an Oct. 31 deadline to notify states of their allocations. In an Oct. 30 email to state officials, CMS said an additional administrative requirement had delayed the competitive portion of the awards, although the $100 million baseline funding for each state was available.
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