The millions of consolation dollars that Republicans are throwing at South Dakota in the guise of the Rural Health Transformation Program won’t make up for the millions more that the state will lose in Medicaid and Medicare cuts from last summer’s budget reconciliation bill.
Worse, the RHT Program itself may not help rural hospitals update their facilities and maintain basic inpatient services:
The emergency department at Big Sandy Medical Center in Montana is just one room, with a single curtain between two beds.
It’s one of the many parts of the 25-bed rural hospital that need updating, former CEO Ron Wiens said as he walked the halls.
He said the hospital, an essential service in its namesake town of nearly 800 residents in the state’s sprawling north-central high plains, needs at least $1 million for deferred maintenance, including a failing HVAC system. But the facility struggles to make payroll each month and can’t afford to make all the fixes, Wiens said.
Built by farmers and ranchers in 1965, Big Sandy Medical Center began with nine beds. Today, a similar community effort — donations and grants to plug financial holes each year — keeps it afloat.
Wiens wishes Big Sandy could get funding from Montana’s share of the $50 billion federal Rural Health Transformation Program to renovate the hospital and direct payments to help secure its future. The state received more than $233 million in its first-year award.
But the hospital may not get the kind of help he sought.
That’s because the five-year federal program focuses on new, creative ways to improve access to rural health care, not on directly funding services and renovations. And Montana is one of at least 10 states whose leaders say projects launched under the federal program could lead rural hospitals to cut services so they can continue to afford to offer emergency and other essential care.
…In Oklahoma, realigning clinical services could mean “shutting down service lines,” according to its application to the federal program. And in Wyoming, any facility that receives funding must agree to “reduce unprofitable, duplicative or nonessential service lines,” according to its rural health law.
Monique McBride, business operations administrator at the Wyoming Department of Health, said the department interprets right-sizing as helping rural hospitals provide essential services — such as emergency departments, ambulance services, and labor and delivery units — while maintaining long-term, financial stability.
“This might involve limiting some elective procedures that could be done at lower cost in higher-volume facilities. The main distinction here is time-sensitive emergencies vs. ‘shoppable’ services,” she said [Aaron Bolton and Arielle Zionts, “A $50 Billion Fund to Help Rural Hospitals Could Actually Lead to Service Cuts,” KFF Health News via NPR, 2026.03.26].
Hospital organizations in Michigan and Nebraska say these rural health dollars aren’t properly targeted to rural health:
Lauren LaPine-Ray, who oversees rural health policy at the Michigan Health & Hospital Association, predicted the state’s rural hospitals will compete with other organizations, such as academic centers and health clinics, for funding. She said about 65% of the group’s rural members have never applied for a state grant before.
“The rural hospitals, the ones that really need the funding the most, will not be well equipped to apply for and pull down these dollars,” LaPine-Ray said.
Jed Hansen, executive director of the Nebraska Rural Health Association, said the federal funding won’t go to “rural hospitals, rural clinics, and rural providers in a meaningful way.”
“Rural Health Transformation will not save a single hospital in our state,” he said. “I don’t think it will save a hospital nationally” [Arielle Zionts and Sarah Jane Tribble, “Lawmakers, Health Groups Resist Their States’ Rural Health Fund Plans,” KFF Health News, 2026.03.04].
Don’t be fooled: Trump’s budget isn’t making rural America greater. It’s just pulling more plugs.