$50B Rural Health Transformation Program Needs More Transparency, Groups Say

This story was originally published by KFF Health News. One year into its creation, a $50 billion federal program aimed at improving rural healthcare lacks transparency, which could make it difficult to protect against fraud, identify successful projects, and ensure the program delivers on its promise to transform the system. Transparency “is really important to help protect the integrity of the program, ensure funds are reaching the communities they’re meant to serve,” said Maya Sandalow, director of health policy for the Bipartisan Policy Center, a nonprofit think tank. The federal government and states are compelled by public records laws to share documents when requested. But those requests can take months to fulfill, making their release too late for meaningful oversight as states rush to spend their allotments under tight federal deadlines. In the meantime, the Centers for Medicare & Medicaid Services — which oversees the Rural Health Transformation Program — and some states aren’t proactively sharing information about where the funding is going and how it will be used. CMS spokesperson Timothy Foster said the agency “will publish an annual report on state progress.” States’ individual reports to CMS are “intended to be” shared upon request, but the agency won’t be proactively publishing the individual state reports, according to a CMS document. Foster didn’t respond to questions about whether the agency will share examples of projects that are and aren’t working or create a tracker of funding recipients, award amounts, and what organizations plan to do with their funding — ideas that health and government transparency advocates have requested. Instead, much of the program’s transparency thus far has been up to state governments, and “the level of details that states have publicized really varies,” said Sandalow, who co-wrote a recent paper on how the federal government can strengthen the rural health program, including through transparency. Some states are sharing information with lawmakers, holding public meetings, and explaining where organizations plan to invest their money. Others are more secretive, with multiple states declining to release public records in response to KFF Health News’ requests. Mississippi’s governor vetoed a transparency-related bill, West Virginia holds closed-door advisory meetings, and a South Dakota official wrote that he hoped CMS would keep its application from public view. “I just don’t believe in all this secrecy,” said Mississippi state Sen. Hob Bryan, who chairs his chamber’s public health committee. “If they’re not up to something nefarious, why do they have to do it all in secret?” Bryan, a Democrat, said there’s bipartisan concern about the lack of transparency in his state. Reaching Rural Patients Congressional Republicans created the five-year Rural Health Transformation Program last summer as an eleventh-hour sweetener to President Donald Trump’s signature One Big Beautiful Bill Act. The money was intended to offset concerns about the outsize fallout anticipated in rural communities from the law, which is expected to reduce overall Medicaid spending by more than $900 billion over a decade. Sandalow said some states may be struggling to share information since they’re busy rushing to hire staff and meet the program’s tight deadlines, including an annual report due Aug. 31. In the meantime, a slew of media outlets, nonprofits, and businesses are stepping in to make it easier for the public to track the rural health program. KFF Health News is collecting states’ applications and approved plans and budgets, not all of which have been posted on state websites. And several health nonprofits and companies have created trackers that describe states’ rural health initiatives, post funding opportunities, or list award recipients. But some resources are available only through paid services, aimed at helping businesses interested in applying for money. Sandalow said previous federal programs “tend to draw attention for gaps in transparency and oversight rather than for doing it well.” As an example, she pointed to the lack of oversight and transparency with the CARES Act and other covid relief programs, which saw fraud and improper payments. In March, CMS published proposed quarterly and annual state reporting requirements for the rural health program, and a notice seeking comments. At least three groups replied with letters expressing concerns about transparency. CMS should share states’ progress reports, funding recipients, and what organizations plan to do with their awards, wrote Zachary Gaumer, the Bipartisan Policy Center’s vice president for health policy. Sharing this information would make it easier to track progress, identify successful programs that other states may want to replicate, and “ensure funds reach the rural communities they are intended to serve,” he wrote. Molly Smith, group vice president for public policy at the American Hospital Association, asked CMS “to be as detailed as possible” about the “final destinations of these funds, given the complexity of the grant funding process.” In her letter, Charlene MacDonald, who leads the Federation of American Hospitals, noted that some funding recipients, such as large health systems and academic medical centers, will be distributing their awards to other entities. CMS should collect those “downstream subrecipients,” wrote MacDonald, whose group represents for-profit hospitals and healthcare systems. Without this information, she said, it will be difficult to know if “funding is reaching the rural hospitals, providers, and communities primarily intended to benefit from the program.” It can also be difficult to know which for-profit companies are being paid with rural health money. For example, Nevada and Kansas have listed hospitals and other health facilities that received funding to purchase telehealth, scanning devices, and other health technology. But the states list only some of the companies from which recipients will buy those products. DIY Dashboards As groups ask CMS to share more information, some states have created their own rural health spending dashboards or recipient lists, with varying levels of detail. Alaska, Kansas, Oklahoma, and other states list which organizations receive funding, their award amounts, and detailed descriptions of how recipients will spend the money. Florida and Nebraska, however, are among the states that don’t share what awardees plan to do with their funding. New Hampshire is posting recipient contracts that detail projects and their budgets on its Rural Health Transformation Program website. Some other states have uploaded contracts and grants on general procurement or award databases, which can be difficult to navigate. Ohio, Virginia, and New Jersey have used press releases to announce awards. But the announcements aren’t posted on their Rural Health Transformation Program websites, which could make it difficult to find this information. Many states created advisory groups to provide transparency and accountability for their programs. Most committees host public meetings and upload minutes, recordings, or other materials from the discussions. But the West Virginia Department of Health won’t share what’s discussed in its rural health advisory panel’s closed-door meetings, according to spokesperson Gailyn Markham. “The panel is intended to serve as an informal forum for discussion and feedback among invited participants and program staff,” Markham said. South Dakota, North Dakota, and Mississippi are among the states without advisory committees. In response to public records requests, South Dakota released a nearly completely redacted version of its budget for the rural health program while Mississippi declined to release its budget. Mississippi’s governor said he vetoed a transparency-related bill because it would “create an unnecessary layer of bureaucracy” that would have slowed the award process, which could cause the state to lose out on future funds. Mississippi is “an incredible outlier in all this secrecy,” Bryan, the state lawmaker, told KFF Health News. Sandalow said it’s important for states to publish the impact of their rural health projects, adding that CMS should share which rural health projects are and aren’t working. She said national and state health organizations are creating networks and holding conferences to help spread this information. States should “be able to learn from each other, get a sense of lessons learned and best practices, and then be able to pivot their initiatives accordingly,” Sandalow said. Michael Cannon, who oversees health policy studies at the libertarian CATO Institute, said people should know how their $50 billion in taxes is being spent on the rural health program, and whether state projects are making rural patients healthier. If investors put that much money into a project, there is “no way” they “would let the recipients of those funds get away with the shoddy approach to transparency and accountability that the states are taking,” he said. KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.