Kansas seeks share of federal government’s $50 billion rural health transformation program

Janet Stanek, Kansas Department of Health and Environment secretary, led discussions with the state's Rural Health Innovation Alliance to apply for a share of $50 billion in federal monies set aside to transform rural health. (Photo by Rachel Mipro/Kansas Reflector)

TOPEKA — Kansas turned in a 60-page application last week in hopes of receiving a share of  $50 billion in federal money designed to transform rural health. 

Nearly one-third of Kansans live in rural communities, and the state’s Rural Health Transformation Plan aims to improve health in those areas. 

Federal government officials originally touted the $50 billion as support for rural hospitals that are set to lose billions of dollars after the One Big Beautiful Bill Act cut Medicaid and other federal health spending. But the program evolved into a more general focus on rural health.

The Kansas plan was developed in two months after the federal government set a tight timeline for submissions to receive a portion of $50 billion Rural Health Transformation Program. 

Of that amount, $25 billion will be distributed evenly among the states selected and the remaining $25 billion will be allocated based on submitted plans, said Kate Sapra, deputy secretary at the Centers for Medicare and Medicaid Services Office of Rural Health Transformation. The money will be paid out over five budget periods, from federal fiscal year 2026 through federal fiscal year 2030. 

Sapra spoke at a September meeting to the team Gov. Laura Kelly appointed to develop the Kansas application, called the Kansas Rural Health Innovation Alliance. The coalition of government, nonprofit and private organizations, including the Kansas Hospital Association, the Association of Community Mental Health Centers of Kansas and the Kansas Association of Local Health Departments.

The Kansas plan focuses on improving health delivery systems, encouraging innovative care models and using innovative technologies, according to the 60-page application submitted last week.

Martie Ross, director of PYA Center for Rural Health Advancement, Overland Park, told the group at its October meeting that they had condensed a yearlong process into six weeks. 

“If I had a piece of advice for Congress, … I would have said please give us at least six months and some funds to develop this application so it’s truly reflective of state needs,” she said. “Instead we have a very short timeframe to submit the final application.” 

Ross outlined complexities of the application process and what would happen between the Nov. 5 deadline to turn it in and the federal government’s Dec. 31 deadline to award the dollars. She said the program is not a grant, but a cooperative agreement. 

“It is a negotiation between CMS and the state as to what will be within the transformation plan and what will come out,” she said. They “certainly appreciate CMS is balancing the demands of 50 applications. Our application does not stand alone on its merits. It always will stand in comparison to other applications.” 

The plan

In Kansas’ application, the coalition focused on the following priorities, outlined in a news release from Kelly: 

• Expand prevention programs to reduce chronic disease rates, including increasing access to preventive screenings and behavioral health services.
• Increase local access to primary care for rural Kansans
• Build a sustainable rural health workforce to support greater access to primary care, dental and behavioral health providers and to ease health shortages. 
• Increase to 100% the number of rural Medicare and Medicaid beneficiaries in accountable care relationships by 2031.
• Use data and technology to help rural providers expand telehealth, remote monitoring and other technologies, as well as support data sharing and analysis of aggregated patient and outcome data.

Metrics are attached to each part of the plan and Ross said that if the state isn’t meeting its metrics at different points during the five-year process, CMS can withhold funds. That money would then be redistributed to states doing better, and Ross said it is important that Kansas tracks its progress well. 

The cost of collecting and tracking data is included in the administrative plan, she said. 

The proposal includes a breakdown of each of the main areas with specifics, such as embedding behavioral health providers into rural hospitals to provide services and expand access to PACE, a health care option for older Kansans who meet certain criteria. 

“At present, 34% of PACE-eligible Kansans (about 4,300 rural residents) do not have access to a PACE program,” the application said. “The state will partner with two successful PACE providers in the state to expand program availability in rural areas, one by expanding an existing program and another by establishing a new one.”

Political input

Kansas Republicans wanted to have input on the Rural Health Transformation Plan during a special session, but they were unable to get enough Republicans to sign a petition to hold the session. In a news release, House Speaker Dan Hawkins lamented the situation. 

“Whatever rural healthcare dollars that Santa Kelly gifts to her favored ‘children’ around the state won’t be able to be returned,” he said. “Those who refused to sign a petition played right into the Governor’s hands by giving her free rein without oversight on hundreds of millions of dollars. Sad.”

The main reason for the session was redistricting Kansas’ congressional districts, but several GOP lawmakers resisted the move.

The state’s federal delegation, led by U.S. Sen. Jerry Moran, wrote a letter in support of the Kansas plan. Others signing on included U.S. representatives Tracey Mann, Derek Schmidt, Ron Estes and Sharice Davids. 

“Rural health care providers across Kansas recognize the urgent need for transformation,” the delegation wrote. “Yet, with many providers operating under persistent negative margins, they face significant barriers to making the critical investments necessary for regional collaboration, clinical integration, and modern technology solutions.”

The lawmakers said the Kansas plan will empower rural care providers and support initiatives to improve rural health.