Rural healthcare is under pressure, but a new federal program offers some hope for strengthening rural health infrastructure.
The Rural Health Transformation (RHT) Program, created by Congress in 2025, is a $50 billion, five-year federal effort to build a sustainable system of rural care. The program will allocate $10 billion annually among every state between 2026 and 2030.
With $50 billion divided 50 ways, healthcare leaders across all states are faced with difficult decisions on how to invest the funding today and how those investments will pay off tomorrow.
This is perhaps the greatest challenge facing state and rural healthcare decision-makers. Amid an environment characterized by cuts to Medicaid and other federal supports that rural hospitals rely on, how can they leverage this funding as catalytic capital to build capabilities that benefit rural healthcare and rural patients that can be sustained after federal funding ends?
The opportunity: virtual-first care strategies
For many health systems, a critical part of the solution lies in telehealth. Many rural health systems have already implemented telehealth programs, such as direct-to-consumer urgent care, behavioral health and other specialty services.
While these programs can certainly deliver value to rural patients, they often use fragmented and episodic approaches that are disconnected from an existing provider or health system.
Connected, virtual-first care strategies offer a better way forward. Under this approach, patients proactively choose to start and manage their health journeys online by establishing long-lasting relationships with virtual care teams that are integrated with trusted local health systems, connecting patients to high-quality, convenient care that is built around their needs and schedules.
Successful virtual-first care strategies are built on three core components:
- Virtual-first patient-centered medical home (PCMH): For a patient, a virtual-first PCMH means their first touchpoint and every ensuing touchpoint is via an easy-to-access virtual doorway—not a confusing maze of portals, vendors or call centers. For health systems and states, this enables seamless care continuity, better chronic disease control, and more efficient care service utilization.
- Virtual multispecialty practice connected to local systems: Rural hospitals often face significant barriers in recruiting full-time specialists. A virtual-first strategy can free rural providers from this hardship by joining a shared virtual practice that can be leveraged by multiple health systems. By delivering virtual access to specialists who are scarce in rural environments, a virtual-first strategy creates capacity that rural communities can access without diluting quality or fragmenting records.
- EHR-integrated, interoperable digital backbone: Virtual-first care must be deeply integrated with existing health IT applications and infrastructure. This means that virtual encounters, referrals, lab and imaging orders, e-prescribing, and remote monitoring data are all documented in a core EHR and patient-facing tools are branded and experienced as extensions of local health systems.
Measuring ROI and success in rural health transformation
As states and health systems begin to roll out rural health strategies, it’s important they don’t treat RHT funds as permanent.
The goal isn’t to build something that works only while grant funding is flowing. The goal is to use those dollars to create a glidepath to sustainability. That means thinking about ROI early and including measurement as a part of the care model itself. If reporting feels like a separate project or an added burden, it won’t scale. Virtual-first care strategies can make this easier by design.
When encounters, referrals, labs, remote monitoring data, and care plans all live in the EHR, measurement becomes a byproduct of care delivery. You’re not chasing data across systems or reconciling spreadsheets at audit time.
Payment alignment is just as critical. Virtual services should be mapped to current and anticipated payment models from the start, whether that’s fee-for-service, alternative payment models, Medicaid directed payments, infrastructure payments, or newer models like CMS’s ACCESS program.
It’s about measuring things that actually matter: reductions in avoidable emergency department visits, better chronic disease control, stronger behavioral health engagement, higher postpartum care completion rates, and fewer no-shows. These are metrics that states care about, health systems recognize, and clinicians can influence.
What success looks like
States and health systems receiving RHT funding should expect rigorous oversight. They’ll need to demonstrate progress across the program’s strategic goals, and this is where virtual-first care really shines.
Success looks like healthier rural communities through proactive, longitudinal care. It looks like sustainable access points that reduce pressure on hospitals while expanding care into homes, schools, workplaces, and community settings. And it looks like smarter use of limited capital, reserving brick-and-mortar investments for services that truly require them, while delivering more primary, behavioral, and chronic care virtually.
Rural health transformation will only succeed if today’s investments are designed to last beyond tomorrow’s funding cycles. Virtual-first care offers a practical path to expand access, improve outcomes, and align with emerging payment models.
