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California outlines plan and timeline to apply for $50 billion Rural Health Transformation Program

September 09, 2025 | Department of Health Care Access and Information, Agencies under Office of the Governor, Executive, California


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California outlines plan and timeline to apply for $50 billion Rural Health Transformation Program
State health officials on the Health Care Access and Information (HCAI) webinar on Sept. 1 described how California will solicit stakeholder input and draft a state application for the federal Rural Health Transformation Program, a $50 billion federal initiative created by H.R. 1. Tiffany Frazier, program coordinator for the State Office of Rural Health, said the program's intent is to "provide support for hospitals, clinics, FQHCs, and other health care providers to make the investments necessary to better meet the needs of rural communities and become more sustainable over the long term."

HCAI Director Elizabeth Landsberg told attendees that stakeholder input will shape the state's proposal and asked participants for data, research and policy suggestions. "Your ideas are important to us and we really encourage you to think outside the box," Landsberg said. The agency said it will collect input via a short survey to be emailed to registrants and posted on HCAI's rural health webpage, and will host additional phone calls and public listening sessions as the application is drafted.

Tiffany Frazier and HCAI staff laid out an interim timeline and funding structure that they will use while they wait for formal federal guidance (a Notice of Funding Opportunity, or NOFO) from the Centers for Medicare & Medicaid Services (CMS). Frazier said the program totals $50,000,000,000 over five years; half of that amount ($25 billion) will be distributed equally to states with an approved application and the other half will be distributed competitively. HCAI senior policy advisor Hovit Khosrobian corrected an on-screen typo and explained the equal portion, if divided among 50 states, would amount to about $100 million per year or roughly $500 million per state across five years, subject to CMS approval.

Officials described near-term deadlines that will shape California's schedule: they expect CMS to release the NOFO in mid-September, plan to accept survey responses for a one-week window after the webinar, hold priority stakeholder phone calls Sept. 15'26, host public listening sessions the week of Sept. 29'Oct. 3, and submit the state application in November so CMS can approve it by Dec. 31, per the federal timeline stated during the webinar. Frazier said states will have two years to spend each year's allotment once funds are received.

HCAI staff outlined the program goals that states must address, including improving access to care, strengthening local partnerships, expanding the rural health workforce, promoting consumer-facing technology, advancing data and technological innovation, and supporting system sustainability. The presenters said the statute highlights workforce recruitment and retention (including a five-year service obligation tied to some workforce supports) and maternity care as priority areas the federal materials have emphasized.

Presenters also shared HCAI's preliminary data snapshot for California's rural health landscape, explicitly noting those figures may change after CMS defines "rural" in the NOFO. Using U.S. Census block definitions, HCAI staff said roughly 2.3 million people live in rural census blocks in California, that 95% of California's land area falls in rural census blocks, and that 57 of 58 counties include rural populations. The office reported 279 rural health clinics, an estimated 151 federally qualified health center (FQHC) sites, and about 76 rural hospitals, and said nearly half of rural communities are in primary care Health Professional Shortage Areas.

Officials asked participants to complete a survey (one response per organization recommended) and said the survey would include about 25 questions, could not be saved mid-completion, and would be distributed with a PDF of questions to help respondents prepare. HCAI staff said the survey and listening sessions will inform which of the authorized activities the state proposes to pursue; they emphasized the state cannot use the RHTP funds as a direct substitute for reductions in Medicaid or Medicare funding described in H.R. 1.

When asked about eligible applicants, presenters said the program is broad: hospitals, clinics, FQHCs, community-based organizations, emergency medical services, and other providers within the rural health system may qualify to participate in funded projects if proposals align with the RHTP goals. Staff also said capital and technology requests (for example, EHR implementation or cybersecurity) will be evaluated based on whether they demonstrably improve long-term access, outcomes or sustainability and that CMS guidance may provide further clarity.

Officials urged attendees to sign up for the rural health mailing list on HCAI's website to receive the survey, updates and invitations to listening sessions. They invited submitters to attach supporting data or research via the survey or email and said HCAI will post the webinar recording and presentation slides on its website within five business days.

The webinar concluded with a request that stakeholders place detailed, specific ideas and metrics in the survey responses, and with officials reiterating that while California aims to be expansive in its priorities, funding will be limited and HCAI will prioritize proposals that align with the statute and CMS criteria. "We will take [your] ideas all very seriously," Landsberg said.

(Reporting note: Quotes and program details in this story are drawn from remarks by HCAI staff during the webinar and from slides presented live. Times and quoted phrases reflect the webinar transcript.)

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