RFK Jr. Misses Mark in Touting Rural Health Transformation Fund as Historic Infusion of Cash

“It’s going to be the largest infusion of federal {dollars} into rural well being care in American historical past.”

Robert F. Kennedy Jr. on Sept. 4, 2025, in a Senate listening to

At a September Senate listening to, Well being and Human Providers Secretary Robert F. Kennedy Jr. boasted a couple of rural well being initiative inside  President Donald Trump’s “One Large Stunning Invoice Act.”

“It’s going to be the largest infusion of federal {dollars} into rural well being care in American historical past,” Kennedy stated, responding to criticism from Sen. Bernie Sanders (I-Vt.). Sanders stated the legislation would hurt sufferers and rural hospitals.

Kennedy was referring to the legislation’s five-year, $50 billion Rural Well being Transformation Program, HHS spokesperson Emily Hilliard stated. GOP lawmakers have made related claims about this system.

The fund was added to the invoice on the final minute to safe help from Republican lawmakers who characterize rural states. Some had been involved about how the invoice’s Medicaid cuts would hurt rural America, the place greater than 150 hospitals have stopped providing inpatient companies or been shuttered fully since 2010, in keeping with the Cecil G. Sheps Heart for Well being Providers Analysis on the College of North Carolina.

“The transformation fund was actually talked about within the context of saving rural hospitals that may be dealing with these vital Medicaid cuts,” stated Carrie Cochran-McClain, chief coverage officer on the Nationwide Rural Well being Affiliation. Medicaid is the joint state-federal medical health insurance program that primarily covers low-income folks and people with disabilities.

So is Kennedy proper in his description of the agricultural well being fund as a historic money infusion, or does it fail to acknowledge crucial context?

The Rural Well being Transformation Program

Trump’s tax and spending legislation is anticipated to cut back federal Medicaid spending in rural areas by not less than $137 billion by 2034, in keeping with an evaluation by KFF, a well being info nonprofit that features KFF Well being Information. The Congressional Finances Workplace predicts the legislation will enhance the general variety of uninsured sufferers by 10 million by 2034.

Rural well being services disproportionately depend on Medicaid reimbursement to remain afloat. In 2023, 40.6% of kids and 18.3% of adults below age 65 from rural areas and small cities had been enrolled in Medicaid, in keeping with the Heart for Kids and Households at Georgetown College. In metro areas, the charges had been 38.2% and 16.3%, respectively.

The Trump administration argues that rural hospitals can not depend on “legacy” funding sources like Medicaid and Medicare because of the applications’ reimbursement construction, which ties funds to the variety of companies offered, a mannequin that’s not financially sustainable for rural services with sometimes low affected person volumes.

“Distinct from these different applications, the Rural Well being Transformation Program is designed to offer a versatile supply of funding” to advertise innovation, effectivity, and sustainability, the White Home wrote in a memo.

Right here’s the way it works. States can suggest initiatives spearheaded by state companies, well being care suppliers, consultants, and distributors geared toward numerous functions, comparable to bettering know-how, entry to care, and workforce recruitment.

States can use solely 15% of their transformation program funding for supplier funds and might direct cash to non-rural areas, in keeping with KFF.

Half of the $50 billion shall be evenly divided amongst states whose functions are permitted — no matter their rural and total populations — in keeping with the “Discover of Funding Alternative” for this system.

The opposite half shall be awarded primarily based on “the transformative potentialities” of states’ grant proposals; how a lot they’ve dedicated to aligning their well being insurance policies with the Trump administration’s; and information on their rural inhabitants, rural well being services, uncompensated care, and different measurements.

The applying deadline is Nov. 5.

The Large Image

Michael Meit, director of the Heart for Rural Well being and Analysis at East Tennessee State College, stated the agricultural well being neighborhood is happy concerning the improvements the brand new program may foster, however he’d “love for it to occur within the absence of those cuts which are going to devastate our rural well being system.”

“It’s not going to fill the outlet,” Meit stated.

KFF estimates that the agricultural well being fund’s five-year, $50 billion funding is a bit of over a 3rd of the anticipated lack of federal funding in rural areas that shall be unfold over 10 years. In accordance with that evaluation, Medicaid cuts over that interval would tally not less than $137 billion in rural areas.

That quantity doesn’t account for different reductions stemming from the identical legislation, comparable to cuts to the ACA Marketplaces or the well being system income loss anticipated from a rise within the variety of folks with out insurance coverage. 

These components are essential to notice as a result of the agricultural well being program is a brief initiative, whereas reductions in federal spending are long-term.  

One other problem is the distinction in this system’s spirit. The agricultural well being fund is concentrated on reworking the agricultural well being care system — not offering continued funding to maintain services open or making up for misplaced Medicaid funds. Even when the cash triggers profitable improvements, there are doubts that these will occur in time to stop rural well being services from closing.

“There’s an actual misperception that in some way these funds are going to have the ability to save rural America or save rural hospitals,” Cochran-McClain stated.

Joseph Antos, a well being coverage skilled and senior fellow emeritus on the conservative-leaning American Enterprise Institute, stated Kennedy’s remark is one thing “politicians say after they need to ignore the remainder of the insurance policies.”

“What they needed was to say that they had been creating a brand new program,” Antos stated. “Effectively, this can be a very inefficient approach to distribute a comparatively very small amount of cash to hospitals that can incur a lot bigger unhealthy debt over the approaching years, because of the cuts in Medicaid.”

One Caveat

Specialists stated that when considered exterior of obligatory applications like Medicare and Medicaid, the $50 billion rural well being fund does seem like unequalled, particularly for a restricted, five-year program.

A number of talked about the Hill-Burton Act as one other program that considerably boosted rural well being care. The legislation offered loans and grants that modernized or constructed 6,800 well being services, lots of which had been in rural areas, from 1946 to 1997, in keeping with the Well being Sources and Providers Administration.

Incomplete funding information makes it troublesome to account for inflation, stated Kelsey Moran, an assistant professor and well being economist on the College of Miami.

However she estimated that, throughout the lifetime of this system, it spent $47 billion in 2024 {dollars} when utilizing the Shopper Value Index, or $109 billion when utilizing the CPI’s medical care index. The medical index has a better inflation fee as a result of well being costs have risen greater than total costs.

Our Ruling 

Kennedy stated the agricultural well being fund is “going to be the largest infusion of federal {dollars} into rural well being care in American historical past.”

The assertion comprises a component of fact as a result of the brand new program might be essentially the most vital one-time funding in rural well being funding.

However it ignores crucial details and context that create a unique impression.

Federal contributions to rural areas from Medicaid and Medicare simply dwarf this program’s $50 billion mark. The brand new fund provides states flexibility in how they’ll allocate assets, that means there’s no assure that each one the brand new funding will go to rural Individuals’ well being care. This system comes on the identical time rural areas are anticipated to lose much more from Medicaid cuts and a rise in uninsured sufferers than what the agricultural well being fund infusion can backfill.

Specialists say the agricultural well being fund’s money infusion is canceled out by different components of Trump’s tax and spending legislation that decision for cuts and coverage modifications.

We fee this assertion Largely False.

Our Sources

“Watch: Sanders, RFK Jr. Get Into Testy Trade Over COVID Vaccine, CDC Director’s Firing,” CBS Information, Sept. 4, 2025.

“$50B Rural Well being ‘Slush Fund’ Faces Questions, Skepticism,” KFF Well being Information, July 21, 2025.

“Rural Hospital Closures,” Cecil G. Sheps Heart for Well being Providers Analysis on the College of North Carolina-Chapel Hill, accessed Sept. 15, 2025.

“Senate GOP Mulls Shielding Rural Hospitals From Medicaid Cuts,” Roll Name, June 20, 2025.

“Key Takeaways From CMS’s Rural Well being Funding Announcement,” KFF, Sept. 23, 2025.

“Estimated Budgetary Results of Public Legislation 119-21, To Present for Reconciliation Pursuant to Title II of H. Con. Res. 14, Relative to CBO’s January 2025 Baseline,” Congressional Finances Workplace, July 21, 2025.

“Medicaid’s Function in Small Cities and Rural Areas,” Georgetown College Heart for Kids and Households, Jan. 15, 2025.

“MEMORANDUM Re: The One Large Stunning Invoice is a Historic Funding in Rural Healthcare,” The White Home, undated.

Discover of Funding Alternative for the Rural Well being Transformation Program, authorities doc revealed on Sept. 15, 2025.

“The Federal Finances in Fiscal Yr 2023: An Infographic,” Congressional Finances Workplace, March 5, 2024.

“The Federal Finances in Fiscal Yr 2024: An Infographic,” Congressional Finances Workplace, March 20, 2025.

“Hill-Burton Services Compliance,” HRSA, accessed Sept. 16, 2025.

“Hospital Charity Care & The Hill-Burton Act,” working paper by Kelsey Moran up to date on Sept. 15, 2025.

Telephone interview with Matthew Fiedler, a senior fellow in financial research on the Heart on Well being Coverage at The Brookings Establishment, Sept. 24, 2025.

Telephone interview with Gbenga Ajilore, chief economist, and Allison Orris, director of Medicaid coverage on the Heart on Finances and Coverage Priorities, Sept. 24, 2025.

Telephone interview with Larry Levitt, govt vice chairman for well being coverage at KFF, Sept. 24, 2025.

Telephone interview with Joseph Antos, a well being coverage skilled and senior fellow emeritus on the American Enterprise Institute, Sept. 23, 2025.

Telephone interview with Carrie Cochran-McClain, chief coverage officer on the Nationwide Rural Well being Affiliation, Sept. 17, 2025.

Telephone interview with Kelsey Moran, assistant professor within the Division of Well being Administration and Coverage on the College of Miami, Sept. 15, 2025.

Telephone interview with Alana Knudson, director of the NORC Walsh Heart for Rural Well being Evaluation on the College of Chicago, Sept. 12, 2025.

Telephone interview with Michael Meit, director of the Heart for Rural Well being and Analysis at East Tennessee State College, Sept. 11, 2025.