Get AI Briefings, Transcripts & Alerts on Local & National Government Meetings — Forever.
California outlines $233 million rural health transformation plan after CMS approval
Loading...
Summary
State HCAI officials presented the CalRHT/CalRite program, announcing CMS approval and an approximately $233 million award, a 5% tribal set-aside, a late-spring application release and an Oct. 30 obligation deadline for FY2026 funds.
California's Department of Health Care Access and Information on Jan. 30 described how it will spend an approximately $233 million federal rural health transformation award to build regional care collaboratives, expand workforce programs and modernize technology for rural communities.
"All activities, full 233,600,000, were approved by CMS and now are available for us to start implementing," Hovit Khosroevian, senior policy adviser for health workforce at the department, said during a statewide webinar. He said CalRHT will prioritize multi-year, structural changes over short-term operational backfill.
The department said the grant targets three intertwined initiatives: a transformative care model that links rural clinics and hospitals with larger hub centers; workforce-development efforts including mapping, education pathways and retention/relocation grants; and technology and tools such as EHR upgrades, eConsult and remote monitoring.
Officials described key guardrails: the program follows nine permissible uses outlined in HR 1 and the CMS notice of funding opportunity, with caps on some funding types (for example, provider payments that CMS treats as capped). Khosroevian said certain workforce awards that fund licensed or certified clinicians will carry a five-year service obligation tied to the funding; community health workers and other noncertified allied roles generally would not be subject to that obligation.
CalRHT staff said they plan to release the first grant applications in late spring or early summer 2026, select awardees in summer 2026, and complete contracting and CMS approval so funds are obligated by Oct. 30, 2026. Grantees, once awarded, would have through Sept. 2027 to expend FY2026 funds, department officials said.
The program sets a 5% budget floor for tribal partners and said applications that demonstrate collaboration with tribal health organizations will be prioritized. Department staff also said awards and subawards will include CMS reporting and oversight provisions and that further webinars will outline reporting requirements.
Dr. Lametta Tafara, the department's chief medical officer, described "transformative payments": time-limited, milestone-based investments for select rural hospitals that are intended to support measurable improvements and not to serve as ongoing operating subsidies. Tafara emphasized that payments would not duplicate or supplant other funding sources, consistent with CMS requirements.
The department encouraged prospective applicants to read its project and budget narratives and FAQs posted online and to send follow-up questions to the CalRHT email address. Officials said the state reached roughly 1,600 stakeholders during the application preparation phase and will establish a Rural Health Policy Council to advise implementation and policy decisions.
Next steps: watch for application releases in late spring/early summer 2026, and for award announcements and CMS review over the summer and fall leading into contracting before the Oct. 30 obligation deadline.
