Overview
- Initial fiscal 2026 allocations span roughly $147 million to $281 million per state, marking the first disbursements under the five-year initiative.
- Texas received the largest first-year award at $281.3 million, followed by Alaska ($272.2 million), California ($233.6 million), Montana ($233.5 million) and Oklahoma ($223.5 million), with New Jersey lowest at $147.2 million.
- State-specific totals highlighted in new notices include North Carolina at $213 million, Michigan at $173 million and Connecticut at about $154 million.
- The program splits funding so that half is distributed equally across states while the remainder is allocated based on rural metrics and state proposals, overseen by CMS’s new Office of Rural Health Transformation.
- CMS Administrator Dr. Mehmet Oz said annual audits could lead to additional funds for strong performers or clawbacks for underperformance, as independent analysts warn the program offsets only a little over one-third of an estimated $137 billion in rural Medicaid cuts over the next decade.