Rural Transformation Program State Legislative Resources

State Health & Value Strategies is tracking state preparation for the Rural Health Transformation Program. As of early October, 48 states are requesting public input into the state's application. Mississippi and New Mexico also solicited consultant bids for application preparation. While most requests for public input contain limited or no information about state priorities, some requests have more information.

Below are examples of state requests for input that contain more information about the provider types, services and activities that will be prioritized in states if their applications are approved.

• The Colorado Department of Health Care Policy and Financing released a document outlining the state's progress on the Rural Health Transformation Program, including engagement with internal and external partners, existing state programs and priorities and financial and economic impact information. The state Medicaid agency will be responsible for distributing funds. Allowed providers include rural hospitals, community health centers and behavioral health providers and permitted activities that align with existing rural work are included.
• The Wisconsin Department of Health Services is seeking respondents to inform the state's application for the new Rural Health Transformation Program (RHTP). Respondents were encouraged to consider how input may align with local or regional collaborative efforts, including behavioral health, community-based organizations, educational institutions, health workforce programs, emergency medical services, federally qualified health centers, rural health centers, local governments, hospitals and health systems, tribal health organizations, rural residents and potential vendors.

States were encouraged (but not required) to submit a Letter of Intent to CMS by Sept. 30, 2025. Arkansas, Montana and Washington posted their letters of intent publicly. While state governors' offices are responsible for completing and submitting applications to CMS, several states have sought public input from stakeholders across public and private sectors. For example, Alabama formed an advisory group, Indiana formed a working group and North Dakota formed an interim committee on RHTP, both of which include state legislators.

According to the Centers for Medicare and Medicaid Services, states RHTP applications must include three or more approved uses:

• Promoting evidence-based, measurable interventions to improve prevention and chronic disease management.
• Providing payments to health care providers for the provision of health care items or services.
• Promoting consumer-facing, technology-driven solutions to prevent and manage chronic diseases.
• Providing training and technical assistance for the development and adoption of technology-enabled solutions that improve care delivery in rural hospitals, including remote monitoring, robotics, artificial intelligence and other advanced technologies.
• Recruiting and retaining clinical workforce talent to rural areas, with commitments to serve rural communities for a minimum of five years.
• Providing technical assistance, software and hardware for significant information technology advances designed to improve efficiency, enhance cybersecurity capability development and improve patient health outcomes.
• Assisting rural communities to right-size their health care delivery systems by identifying needed preventative, ambulatory, pre-hospital, emergency, acute inpatient care, outpatient care and post-acute care service lines.
• Supporting access to opioid use disorder treatment services, other substance use disorder treatment services and mental health services.
• Developing projects that support innovative models of care that include value-based care arrangements and alternative payment models.
• Additional uses designed to promote sustainable access to high quality rural health care services.

NCSL staff have compiled examples of how states have addressed several of these topics below. Please note, these topics and examples are not exhaustive. For specific provisions on allowable expenditures under RHTP, please see Public Law 119-21, Section 71401 and the CMS Notice of Funding Opportunity.

One of the approved uses of RHTP funding is "promoting evidence-based, measurable interventions to improve prevention and chronic disease management." Rural communities face higher rates of chronic diseases and related mortality, such as heart attack, stroke, diabetes, respiratory illnesses, HIV/AIDS and arthritis. Many states have enacted legislation leveraging community pharmacists, setting nutrition education requirements, increasing access to diabetes care and supporting maternal and child health services to improve chronic disease health outcomes in rural communities.

Community Pharmacists

Rural residents are more likely to visit pharmacists for a variety of health care services, like dispensing medications for acute and chronic illness, routine vaccinations, opioid and addiction management therapy, contraception and patient counseling on medications. To ensure residents can access care through pharmacy settings, states define the scope of practice for pharmacists, including prescription adaptation, vaccine administration, prescription of hormonal contraceptives and prescription of tobacco cessation aids. For example:

• Vermont (Vt. Stat. Ann. tit. §26-2023) allows a pharmacist to prescribe and dispense tobacco cessation products, approved by the FDA, consistent with a valid state protocol and approved by the Commissioner of Health.
• West Virginia SB 526 (225) allows pharmacists to prescribe certain drugs for up to a 30-day supply in a six-month timeframe in accordance with FDA labeling and requires the pharmacist to notify the patient's primary care physician of prescriptions.

Nutrition Continuing Education Requirements

Access to nutritious and affordable food may impact several chronic health conditions like diabetes, obesity and smoking. States may set the education and training requirements to be licensed to practice within the state's borders for health care professionals to provide counseling for patients on choosing healthy, affordable, delicious and easy to prepare foods. For example,

• California AB 2270 (2024) requires the medical board to encourage physicians and surgeons to take nutrition continuing education.
• Louisiana SB 14 (2025) requires physicians and physician assistants practicing to complete at least one hour of continuing education on nutrition and metabolic health every four years.
• Texas SB 25 (2025) physician continuing medical education on nutrition and metabolic health.

Diabetes Care

The majority of rural counties do not have diabetes self-management education and support programs. To bolster diabetes care, states may require health insurance plans, Medicaid or the state employee health plan to cover diabetes screening, equipment, supplies, services, medication or education. States may also address insulin access and affordability, establish insulin urgent need programs, establish public-private partnerships to mitigate drug shortages, or address access to Glucagon-Like Peptide-1 Receptor Agonists or GLP-1s. For example:

• New Jersey (New. Jersey Rev. Stat. § 26:2J-4.11) requires every contract for health care services to provide diabetes self-management education to ensure access for individuals with diabetes.
• Montana (Mont. Code Ann. §2-18-704) requires state employee group benefit plans and the university system to provide coverage for medically necessary and prescribed outpatient self-management training and education for the treatment of diabetes.

Maternal and Child Health Services

Proximity to hospitals, clinics and other health care facilities may influence a woman's ability to receive timely and suitable pre-and postnatal care. States have leveraged a variety of strategies, including enhancing access to prenatal care, bolstering the maternal health workforce, addressing non-medical drivers of health such as safe and affordable housing and concrete supports and leveraging telehealth and remote patient monitoring. For example:

• Colorado SB 175 (2024) requires health benefit plans to cover doula services in the same scope and duration as the state Medicaid agency.
• Georgia HB 19 (2023) appropriates funding for a pilot to provide home visiting in at-risk and underserved rural communities during pregnancy and early childhood to improve birth outcomes, reduce preterm deliveries, and decrease infant and maternal mortality.

Additional Resources

• State Actions to Improve Cardiovascular Health
• Keys to Better Health May Lie in Safe, Stable Housing
• Feeding Growth: The Economic Impact of SNAP on States and Rural Communities
• Maternal and Child Health Legislative Database - Enacted only; 2017-present.
• The First Year Matters: State Strategies to Prevent Infant Deaths
• Ways to Ensure Newborns and Their Moms Have Bright Futures
• State Actions Addressing the Non-Medical Drivers of Maternal Mortality
• Youth Mental Health: States Pursue Prevention, Treatment and Crisis Response
• Tackling Childhood Asthma with a Kid- and Family-Centered Approach
• Accessing Diabetes Care and Management
• Improving Access and Affordability of Insulin and Diabetic Supplies
• Insulin Affordability: Where Do States Go From Here?
• Growth, Volume, Price: The Skinny on GLP-1 Medications
• NCSL Prescription Drug Policy Resource Center

One of the approved uses of RHTP funding includes "providing payments to health care providers" and "recruiting and training clinical workforce talent to rural areas." Rural communities often face unique workforce challenges, including shortages of specialty and primary care providers, fewer younger providers entering the workforce and more professionals at or nearing retirement age. States are addressing rural health workforce challenges in many ways, including bolstering allied health occupations, establishing rural medical residencies and establishing financial incentives.

Allied Health Occupations

Community health workers can increase access to health care, especially in rural and underserved areas, improve health outcomes and reduce disparities in a cost-effective way. Medicaid payment for community health worker services varies by state. States may pay for community health worker services through Medicaid state plan amendments, 1115 demonstration waivers, or managed care. For example:

• Arkansas SB 213 (2025) requires the Arkansas Medicaid Program to reimburse doulas and community health workers for home visitation related to prenatal and postpartum care and directs the department to apply for a Medicaid waiver, state plan amendment or other authority to reimburse for doula and community health worker home visits.
• Connecticut SB 989 (2023) required a study of Medicaid reimbursement rates and for the commissioner to design and implement Medicaid reimbursement for certified community health workers.

Rural Medical Residencies

Medical graduates are more likely to continue to practice in locations where they complete GME training, including rural areas, though rates vary by specialty and state. Several states target GME funding, particularly through Medicaid and state appropriations, to teaching hospitals and other community-based settings in rural and underserved communities. For example:

• New Mexico received approval from the CMS in 2020 to provide Medicaid GME funding to federally qualified health centers and rural health clinics as training sites to increase rural access to care. The program includes a rural track allowing residents to complete most of their clinical training in a rural area, with rotations in urban areas.
• Wisconsin (Wis. Act 190, 2010) led to the development of the Wisconsin Collaborative for Rural Graduate Medical Education, which provides technical assistance and support for establishing new and expanding existing rural residency slots across the state.

Financial Incentives

To encourage health care professionals to practice in rural communities, states may establish student loan repayment or forgiveness programs, tax credits and other financial incentives with a required practice period for eligibility. For example:

• Colorado HB 1142 (2016), HB 1088 (2019) and HB 1005 (2022) established and modified the state's Rural and Frontier Area Preceptor Tax Credit. A 2023 study found that the tax credit provided incentives for preceptors to offer instruction, training and supervision to trainees in rural and frontier areas.
• Kentucky (Ky. Rev. Stat. §211.165) has a loan repayment program for health professionals who serve in a health professional shortage area for two or three-year contracts. A sponsor source (such as practice site, private foundation, corporation, community organization or philanthropy, must provide a 50-50 match for the loan repayment amount.

Additional Resources

• Health Workforce Legislation Database - Enacted-only, 2024-Present.
• Scope of Practice Policy Resource Center
• Shortages in the Behavioral Health Workforce, Our American States Podcast
• Health Workforce Trends in State Legislatures
• Allied Health Professions: Considerations for State Legislatures
• Workforce Supports: Improving Maternal Health Outcomes
• Graduate Medical Education Funding
• Understanding Medicaid's Role in Graduate Medical Education
• Expanded Medical Training Could Help Hospitals in Rural, Underserved Areas
• Leveraging Career Pathway Programs: State Strategies to Combat Health Care Workforce Shortages

One of the approved uses of RHTP funding includes "assisting rural communities to right-size their health care delivery systems by identifying needed… ambulatory, pre-hospital, [and] emergency… service lines." Changes to provider taxes under the 2025 Federal Reconciliation Bill may decrease funding streams that support EMS and emergency transport services. This could place further strain on EMS systems that are already struggling to provide services, particularly in rural and remote communities that face geographic, weather and other challenges.

Community Paramedicine

Many states and localities have authorized EMS clinicians to provide non-traditional services to reduce emergency room overcrowding, improve patient outcomes and enhance access to care. Non-traditional services may include community paramedicine or mobile integrated healthcare, transportation to an alternative destination, inclusion in mobile crisis teams, telehealth within EMS and treatment in place protocols and services. For example:

• Mississippi HB 1489 (2024) requires health benefit plans to provide coverage for ambulance services to treat or assess an enrollee in place; triage or triage and transport an enrollee to an alternative destination; or an encounter that results without the transport of the enrollee. Coverage shall not be less than the minimum allowable reimbursement for advanced life support rate with mileage to the scene.
• Tennessee S 2319 (2022) requires TennCare to develop and implement a program similar to the federal Emergency Treat, Triage and Transport (ET3) model. The TN-T2 Program was developed as a payment model to provide reimbursement for treatment in place and transport to alternative destinations.

Additional Resources

• EMS Legislative Database - Enacted-only, 2021-Present.
• State Policies Defining EMS as Essential
• EMS Overdose and Prevention: Innovative Strategies to Save Lives
• Key Trends in Emergency Medical Services Policies for 2024
• Allied Health Professionals Series: Community Paramedics
• Emergency Medicine in Rural America, Our American States Podcast
• Community Paramedicine: Connecting Patients to Care and Reducing Costs

One of the approved uses of RHTP funding includes "promoting consumer-facing, technology-driven solutions to prevent and manage chronic diseases" and "providing technical assistance, software and hardware for significant information technology advances." States are increasingly leveraging technologies like telehealth and artificial intelligence to tackle rural health challenges. These tools help expand access to care, strengthen the health workforce and overcome geographic and resource barriers in rural communities.

Telehealth

Telehealth may build and supplement workforce capacity in rural areas, where recruiting and retaining health care workers is a challenge. To support telehealth and health information exchange, access to broadband services and technology is key. Some rural areas do not currently have access to high-speed internet connections, which allow data to be transmitted efficiently. For example:

• Alabama HB 1 (2023) appropriated up to $9,000,000 to facilitate the expansion and use of telemedicine. Eligible uses include the facilitation and expansion of healthcare specializations in rural and community hospitals through telemedicine affiliations with hospitals or health systems in the state and the utilization of telemedicine delivery systems in rural and educational settings.
• Illinois HB 3879 (2022) designates health care telemonitoring to connect community health care providers in urban and rural underserved areas with specialists in collaborative sessions to improve expertise and services in a variety of areas, including, but not limited to, adolescent health, Hepatitis C, complex diabetes, geriatrics, mental illness, opioid use disorders, substance use disorders, maternity care, childhood adversity and trauma, pediatric ADHD, and other priorities identified by the Department of Healthcare and Family Services.

Artificial Intelligence

A 2020 study in the Journal of Internal Medicine found that physicians spent approximately 29% of their time on administrative tasks and electronic health record input tasks. States, health care systems and professionals are exploring the potential use of artificial intelligence to reduce cognitive load and increase efficiency, potentially reducing burnout. According to NCSL, 38 states adopted or enacted more than 100 measures in 2025 related to AI. For example:

• Mississippi SB 2426 (2025)​ established a workgroup on AI implementation, including at least two representatives from the health care sector.
• New Mexico HB 178 (2025)​ directed their Board of Nursing to create rules and standards related to how AI can be used in the practice of nursing.

Additional Resources

• Health Costs, Coverage and Delivery State Legislation - Enacted-only, 2022-present. Includes telehealth legislation.
• State Public Health Legislation Database - Introduced, 2021-present. Includes data infrastructure legislation.
• Summary of Artificial Intelligence 2025 Legislation
• Telehealth Explainer Series: A Toolkit for State Legislatures
• Workforce and Data System Strategies to Improve Public Health Policy Decisions
• Artificial Intelligence & Health Care: A Primer

One of the approved uses of RHTP funding is "supporting access to opioid use disorder treatment services, other substance use disorder treatment services and mental health services." While behavioral health services may be hard to access in any area, rural areas may have even fewer options for care, so states may use a multi-pronged approach to increase access to treatment. States use a variety of policy options to increase access to behavioral health services for their residents.

Integrated Care

Medical and behavioral health services in the U.S. are often delivered in separate systems that do not coordinate with one another. States are leveraging integrated care, including through certified community behavioral health clinics, or CCBHCs, to provide around-the-clock crisis care, care coordination with social services and primary care providers, and integration with physical health care, among others. For example:

• Kansas HB 2208 (2021) directed its department to establish a process to certify and fund certified community behavioral health clinics, and the state certified up to 26 CCBHCs, starting with existing clinics in 2022.
• Nebraska LB 276 (2023) appropriated up to $4.5 million from the general fund beginning in fiscal year 2025-26 to streamline the licensing and set standards for behavioral health clinics.
• Washington SB 5536 (2023) Established Medicaid health engagement hubs for people with substance use disorders based on a patient-centered medical home model. The hubs provide all-in-one access to medical, harm reduction, treatment and social services, paid through a bundled payment.

Substance Use Disorder Treatment in Carceral Settings

There are barriers to providing substance use disorder (SUD) treatment services for individuals both pre- and post-release. For rural residents, longer travel distances to access care may impact care following release. States are improving access to care in correctional facilities and following release. For example:

• Alabama HB 465 (2023) appropriated $1.5 million in opioid settlement funds for opioid and co-occurring substance abuse treatment, including FDA-approved medications and pre- and post-release services to justice-involved individuals.
• Maine HB 490 (2021) created a comprehensive SUD treatment pilot program that included screening, assessment, medically managed withdrawal, medication-assisted treatment and individual and group counseling for incarcerated individuals.

Recovery Support

Health care extenders, including peer support specialists, extend the reach of existing providers and create connections to care in areas that may face behavioral health workforce challenges. Policymakers can integrate peer support specialists into the health care system through certification, training, continuing education, financing and reimbursement of services. For example:

• Utah HB 491 (2025) appropriated $24,000 as an ongoing appropriation to increase Medicaid rates for peer support specialist services.
• Washington HB 1813 (2025) required the health authority to direct managed care organizations to establish, continue or expand delegation arrangements with behavioral health administrative service organizations for crisis services, including mobile crisis teams and peer support services.

Overdose Prevention

States continue to consider strategies that address drug threats and reduce overdose mortality. The NCSL State Overdose Policy Collaborative convened executive and legislative branch members in five states (Colorado, Tennessee, Utah, Vermont and West Virginia) to create state plans to address overdose. State teams discussed using data to quickly detect overdose spikes and coordinate response efforts; expanding access to naloxone and launching education campaigns; enhancing the role of emergency medical services and other community responders; engaging peer support specialists; and initiating buprenorphine in emergency departments. For example:

Additional Resources

• Behavioral Health Policy Series
• Allied Health Professions Series: Counselors and Therapists
• How to Adress the Shortage of Mental Health Workers? Create More Pathways to Certification
• Signs of Progress in the Fight Against Overdose Deaths
• Telehealth: Improving Behavioral Health from Afar

One of the approved uses of RHTP funding is "developing projects that support innovative models of care that include value-based care arrangements and alternative payment models." States may consider value-based care or alternative payment models as an alternative to traditional fee-for-service (FFS) payment models that pay providers according to the volume of services provided. Traditional FFS payment models pose challenges to rural providers who see fewer patients and provide a lower volume of services than non-rural facilities. Some states have explored alternative payment models specific to rural providers and communities. For example:

• Missouri Transformation of Rural Community Health: The Missouri Transformation of Rural Community Health, or ToRCH model brings together partnerships across rural hospitals, rural primary care and behavioral health clinics, and community-based organizations offering social services. The model includes shared savings incentives for enhancing population health within the community. The models leverage a shared information exchange to address nonmedical drivers of health and reduce preventable hospital admissions and emergency room visits.
• Pennsylvania Rural Health Model: The Pennsylvania Rural Health Model, part of a CMS Innovation Center program, established multipayer global budget payments for rural hospitals. Global budgets are a type of population-based payment in which predetermined payment amounts are made to a hospital to cover most or all of a patient's care during a specified time period. The Pennsylvania Rural Health Model ended in 2024. Despite the end of the payment model, Pennsylvania HB 1351 (2023) continues appropriating funds and re-authorized the Rural Health Redesign Center, including the Center's research into alternative payment models for rural providers.

Additional Resources

• The State Legislative Role in Value-Based Care: Results from a 15-State Survey
• Supporting Rural Health Facilities
• Value-Based Care in the States
• Understanding Value-Based Care: Key Terms, Tradeoffs and Examples
• Value-Based Care in State Medicaid Programs
• Value-Based Care in the Commercial Sector and With Multi-Payer Arrangements
• Addressing Social Needs in Value-Based Care Models
• Profiles of Value Based Care in Action