Rural health, already struggling, braces for further uncertainty

A coalition of technology stakeholders led by Lumeris has formed the Collaborative for Healthy Rural America to help states participate in the federal Rural Health Transformation program and bring greater scale to efforts to improve rural care delivery. The announcement comes at a pivotal time for rural health, as the application deadline for the federal program has passed but uncertainty remains about its true scope and legacy. 

In its statement, the collaborative spelled out its goal of building a Primary Care as a Service platform that can be tailored to the needs of rural communities. Lumeris intends to provide the underlying platform, with partners supporting virtual care (Teladoc Health), chronic disease management (Nuna), non-clinical care coordination (Unite Us), and data integration (Deloitte).  

The collaborative’s statement suggested three factors have motivated its formation. One is the ongoing financial uncertainty surrounding care delivery in rural areas, where close to 200 hospitals have closed in 20 years and another 600 face the risk of closure. The second is an expected shortage of close to 90,000 primary care physicians in the next decade, especially in communities with large populations of Medicaid and Medicare beneficiaries. 

The third is Rural Health Transformation. Announced as part of One Big Beautiful Bill Act, the program will distribute $50 billion in aid over five years, with half going to state applications that meet baseline requirements and half allocated based on “rigorous, data-driven merit review.” (Applications were due Nov. 5, though due to the government shutdown it may take a while for states to get answers from the Centers for Medicare & Medicaid Services.) 

Manatt Health’s Patricia Boozang indicated CMS will likely look favorably on technology-enabled innovation such as AI-powered technology platforms, telehealth services, or mobile units that can address unmet needs in maternity care or preventive health. She stressed, though, that the program will emphasize new initiatives; it’s not meant to supplement operating budgets. 

Here, alignment between the federal program and Collaborative for Healthy Rural America is clear. A platform expanding access to primary care, chronic care management, and community-based services certainly represents technology-enabled innovation. 

Less clear, though, is whether the collaboration – or the federal program, for that matter – will be enough to reverse rural health’s decline. The Trump administration has described the $50 billion allocation as “the biggest infusion of federal dollars into rural health care in American history.”  

On paper, a KFF Health News analysis found, the funding amount “does appear to be unrivaled,” particularly for a short-term program. The Hill-Burton Act of 1946, which provided funding for hospital construction, allocated $47 billion (in 2024 dollars) over a period of more than 50 years. 

However, Rural Health Transformation is tied to One Big Beautiful Bill Act, which a separate KFF analysis concluded could cut $137 billion to Medicaid alone over the next decade. Anticipated increases in the uninsurance rate will likely contribute to health system revenue loss as well, KFF said. 

One silver lining could be the program’s role in catalyzing initiatives that aren’t directly tied to federal aid but nonetheless aim to improve rural healthcare’s long-term resilience. For example, the recent Rural Health Transformation Planning Summit highlighted high-impact opportunities to better leverage pharmacy care, emergency medical services, and remote patient monitoring to “strengthen patient access, reinforce and build new infrastructure, and drive rural innovation through digitally enabled care.” 

Brian Eastwood is a Boston-based writer with more than 10 years of experience covering healthcare IT and healthcare delivery. He also writes about enterprise IT, consumer technology, and corporate leadership.