Hawaii wins $188.9 million federal Rural Health Transformation award; state outlines six initiatives and CMS oversight

Hawaii has been awarded $188,892,439.75 for the first budget period of the federal Rural Health Transformation Program (RHTP), state officials told a joint informational briefing of the House Committee on Health on March 6.

Lauren Kim of the governor's office said the cooperative agreement requires substantial involvement by the Centers for Medicare & Medicaid Services (CMS), that every line item will need CMS approval, and that the state has begun preparing RFIs and contract modifications so work can begin quickly once approvals arrive. "This is a cooperative agreement, not a grant where you just give money," Kim said, adding that the state must demonstrate outcomes and comply with reporting requirements.

The briefing presented six priority initiatives the state proposed for budget period one: Home Run (workforce development), a Rural Health Information Network (health IT and interoperability), a rural value-based initiative preparing providers for AHEAD and alternative payment models, the Peleola telehealth initiative, a Rural Infrastructure for Care Access (RECA) package (EMS/trauma strengthening, mobile clinics, oral and behavioral health), and a rural respite network operated by the Department of Human Services.

JABSOM presenters described Home Run as a pipeline-to-practice effort that will fund at least one health-care certificate program in rural schools, support HOSA student travel, place island-based academic tutors, plan nurse residency and rural training tracks, and offer one-time provider incentive payments (up to $200,000) for clinicians who commit to five years of rural service. "We will also be supporting HOSA, and providing education awards to cover tuition for everyone who commits to working in rural areas for five years," a Home Run presenter said.

Jack Lewin, administrator of SHIFTN, said the Rural Health Information Network would invest in electronic health records, interfaces and a strengthened health information exchange. He estimated the hub work at roughly $45 million per year and described plans to connect clinical data with Hawaii's all-payer claims database to enable analytics and care coordination. The related rural value-based initiative was described as roughly $25 million per year to prepare hospitals and clinics for alternative payment models and the AHEAD budget model.

Christina Higa, director of the Pacific Basin Telehealth Resource Center at the University of Hawaii, outlined Peleola, the telehealth initiative, which will rebuild navigator programs in community settings (libraries, churches and shelters), place telehealth kiosks and workplace-based telehealth offerings, expand telehealth to the neighbor islands and charter schools, and develop a stakeholder engagement framework to guide technology, clinical and policy choices.

Kenny Thicke of the Department of Health discussed RECA measures to strengthen EMS and trauma capacity (including centralized patient-transfer tools and Pulsara software), upgrade ambulances with Starlink-capable communications, pilot mobile medical clinics, expand oral-health capacity at Federally Qualified Health Centers, and invest in mobile behavioral-health clinics and crisis outreach teams with peer specialists.

The Department of Human Services described a proposed five-site rural respite network (two sites on Hawaii Island, one on Maui, one on Kauai and one in Waianae on Oahu) to provide short-term residential care for people recovering from hospitalization who lack stable housing or supports; due to the shortened first budget period, the state plans to stand up two sites in the first year and add the others in subsequent years.

Officials emphasized the first budget period is shortened (about 10 months) and the state must obligate and expend these funds quickly; the first annual progress report to CMS is due Aug. 30 and future annual awards will be contingent on performance and compliance. Kim said an oversight team is being established to coordinate initiative leads and assure CMS reporting and program stewardship.

Committee members pressed presenters on several issues during a question-and-answer period. They asked which geographic areas qualify as "rural" under the program; officials said the state used the HRS statutory definition for rural (HRS section 1 b 1) and that the map includes neighbor islands and parts of Oahu such as the Waianae Coast and Waimanalo. Members also asked about long-term maintenance of assets after the five-year award and were told sustainability narratives were part of the application and that the oversight team will work with initiative leads to address subscriptions, upkeep and community capacity.

Several members raised access concerns for people losing insurance, noting that many residents may become uninsured. Officials responded that many proposed interventions could serve uninsured people, but that CMS capped provider payments for uninsured services at 15% of program funds; those funds will be distributed across initiatives rather than concentrated in a single uninsured-services program. Members requested written follow-ups on how the 15% is allocated across initiatives, the RFP timeline for equipment procurement, and the role and funding of external advisers mentioned during the briefing. The chairs said members' questions would be collected and answered in writing.

The briefing concluded with the chair adjourning the session and promising distribution of follow-up responses.

Sources: Remarks and Q&A at the March 6 joint informational briefing before the House Committee on Health, presenters from the governor's office, JABSOM, SHIFTN, the Pacific Basin Telehealth Resource Center, Department of Health and Department of Human Services.