North Carolina has been awarded $213 million by the Centers for Medicare & Medicaid Services (CMS) through the Rural Health Transformation Program (RHTP). The funding, designated for 2026, aims to improve health care access in rural areas across the state. North Carolina may qualify for additional funds annually over the next five years.
Governor Josh Stein commented on the award: “North Carolina has long been a leader in advancing rural health care solutions, and we are excited about how this new program can support innovations to help make rural communities healthier. Our state’s rural communities are wonderful places to live and raise a family but face unique health care challenges. This grant will connect more people to more high-quality health care.”
The North Carolina Department of Health and Human Services (NCDHHS) developed its application with input from over 420 stakeholders, including rural hospitals, community organizations, Tribal communities, and faith-based groups.
NC Health and Human Services Secretary Dev Sangvai said, “We look forward to continuing the collaborative effort needed to make sure everyone has access to affordable, high-quality, patient-centered health care while reducing the burden on rural health providers. The North Carolina Rural Health Transformation Program is one part of our efforts to support the more than 3 million people in North Carolina who live in rural communities.”
North Carolina holds the second-largest rural population among U.S. states, accounting for more than 5 percent of all Americans living in rural areas. The RHTP outlines six main strategies intended to transform rural healthcare systems over five years.
The initiatives will involve cooperation between state agencies, academic institutions, private partners, and local organizations. A proposed Rural Health Innovation Fund will assist providers in accessing new technologies. Once federal funds are received, NCDHHS plans to establish a statewide governing structure and begin developing regional hubs called NC ROOTS.
A steering committee composed of representatives from NCDHHS divisions—including Medicaid and Public Health—as well as universities and community clinics will oversee implementation.
NCDHHS leaders have scheduled a virtual event on January 16, 2026, to discuss RHTP goals and upcoming steps. More details about this event will be released soon.
Over five years, RHTP is expected to enhance healthcare delivery for over three million residents in rural areas and provide financial support for more than 400 facilities statewide. Additional information about the program is available at www.ncdhhs.gov/rhtp.
Despite this new investment from CMS through RHTP, North Carolina faces significant funding losses due to federal reconciliation law H.R. 1. Over ten years, nearly $50 billion in federal Medicaid funding could be lost along with other critical hospital resources. NCDHHS intends to use available RHTP funds while continuing advocacy efforts for increased future support.
