Alabama submitted its application to the federal government to receive hundreds of millions of dollars as part of the Rural Health Transformation Program, Gov. Kay Ivey announced recently.
The state’s plan estimates that about $900 million would be required to meet its 11 outlined initiatives tailored to support rural health care, Alabama Daily News found after reviewing the project narrative.
The $50 billion rural health fund is part of the One Big Beautiful Bill Act, which President Donald Trump signed into law in July, to offset the Medicaid cuts included in the sweeping legislation.
Under the program, Alabama is expected to receive at least $500 million over the next five years. The state could receive additional funding, but that will be at the discretion of the Centers for Medicare and Medicaid Services after the agency reviews all 50 states’ applications.
“As someone from Wilcox County, making meaningful improvements in how we deliver health care in rural Alabama is critically important to me,” Ivey said in a statement. “Thanks to President Trump’s One Big Beautiful Bill, states have an opportunity to make transformational change that will benefit citizens and communities for generations.”
Alabama’s plan for the funds includes 11 initiatives and the estimated required funding over five years for each part of the proposal.
- Collaborative Electronic Health Record, IT and Cybersecurity Initiative, $125 million
- Rural Health Initiative, $275 million
- Maternal and Fetal Health Initiative, $24 million
- Rural Workforce Initiative, $309.75 million
- Cancer Digital Regionalization Initiative, $25 million
- Simulation Training Initiative, $15.5 million
- Statewide EMS Trauma and Stroke Initiative, $20 million
- EMS Treat-In-Place Initiative, $25 million
- Mental Health Initiative, $45.75 million
- Community Medicine Initiative, $5 million
- Rural Health Practice Initiative, $30 million
Improving access to healthcare statewide, using technology to collaborate and share resources and building out the rural provider workforce are some of the goals for the state’s approach to utilizing the money.
Strengthening and incentivizing healthcare providers to serve in rural communities is a key component of helping to combat the state’s workforce shortage. In Alabama last year, there were about 24 primary care providers per 100,000 people, which is significantly lower than the national average of about 283 providers per 100,000 people.
The Rural Workforce Initiative could use the most money out of the 11, at more than $309 million. It could go towards developing curriculum at the Alabama School of Healthcare Sciences and implementing remote training opportunities for EMTs. It could also establish a workforce partnership pipeline between education institutions and rural providers to accelerate training, according to Alabama’s plan.
Many of the initiatives include establishing “regional hubs” to provide IT and cybersecurity support, telehealth services, maternal and fetal health care and cancer detection screenings, among other services.
Some of the other proposed uses of the funds include creating a pilot program for EMS providers to initiate a “treat-in-place” practice to avoid clogging up the few ambulances available in rural areas. The money could also be utilized to expand labor and delivery carts to more rural hospitals to provide life-saving care for mothers and babies before transporting them to more advanced care centers.
The plan highlights how vital this funding will be to Alabama. For the state’s rural hospitals, 60 percent are at risk of closing and 48 percent are at an immediate risk of closing. That’s the second-highest rate in the nation. Nearly 90% of women in rural areas of Alabama live more than 30 minutes from a birthing hospital.
“Alabama’s rural healthcare safety net is, therefore, in jeopardy—not only threatening public health but also undermining rural economic vitality,” the plan reads.
Funding for the Rural Health Transformation Program will last for five years beginning next year. So, making these initiatives sustainable beyond that time period is a critical component of ensuring the improvements can be made permanent.
“If we move a needle a little bit, I fear we’ll see setbacks as soon as the funding has gone away,” Danne Howard, president of Alabama Hospital Association, told ADN in September. “So that is a challenge to implement initiatives that will be sustainable over the long term.”
Alabama’s proposal highlights that sustainability will be achieved through initiatives that will only require startup funding, others that will continue with targeted state policy changes and some that would need public or private funding beyond the end of the program.
Ivey’s office, the Alabama Department of Economic and Community Affairs, the Alabama Department of Finance, the Alabama Medicaid Agency and the Alabama State Health Planning and Development Agency all helped develop the proposal. A working group and stakeholders also contributed their input to the plan.
Awards will be distributed to states by the end of the year. Once Alabama is awarded money, entities in the state will then be able to “apply” for funding under the program to meet the rural health care needs. Funding is expected to be distributed to entities starting at the end of fiscal year 2026.
Under the program, Ivey will also issue an executive order in early 2026 creating an advisory group of legislators and stakeholders tasked with developing legislation and regulations to fully implement the plan.