New Mexico is set to receive another $211 million as part of a nationwide program to bolster rural healthcare, the U.S. Department of Health and Human Services announced Monday.
The fiscal year 2027 round of funds is the second of five years of funding expected to flow to the state through the federal Rural Health Transformation Program, a $50 billion initiative aimed at improving healthcare access, quality and outcomes for rural Americans.
New Mexico has requested a total of $1 billion from the program through 2030, and the state received almost the same award amount — $211.5 million — last year.
The program was established as part of the sweeping 2025 federal reconciliation bill — known as the One Big Beautiful Bill Act — which will also slash Medicaid funding over the next decade. The $50 billion Rural Health Transformation Program won’t come close to replacing the loss in Medicaid revenue for rural hospitals and clinics, according to estimates from the Congressional Budget Office
Nevertheless, U.S. Health Secretary Robert F. Kennedy Jr. on Monday billed the program grants — which totaled $10 billion — as a boon for all 50 states.
“This next $10 billion will expand access to care, strengthen the rural health workforce, improve prevention, and help states build solutions that fit the needs of their own communities,” he said in a statement. “We are giving rural America the resources and flexibility to build stronger health systems that deliver better care and better outcomes.”
In New Mexico, the second year of funding will support expanded access to healthcare in rural communities, workforce recruitment and training initiatives, assistance for rural hospitals and clinics and improvements to healthcare technology and data systems, state Health Care Authority spokesperson Tim Fowler wrote in an email to The New Mexican.
“Our focus is on making investments that address the unique needs of rural communities while building a stronger, more sustainable health care system that will continue serving New Mexicans long after the federal funding ends,” he wrote in an email to The New Mexican.
In the first year of the program, the Health Care Authority established five major initiatives that will be funded by the Rural Health Transformation Program.
New Mexico plans to spend the biggest chunk of the money — nearly $400 million — on the “Healthy Horizons” program, a plan to expand specialty care and chronic disease management services in rural communities through enhanced in-person services as well as remote options.
The state has made some progress in standing up that program. The Health Care Authority in September identified six regional hub organizations to identify needs, set priorities and develop plans to improve access to care. However, their budgets and implementation plans must be approved by the Health Care Authority before they can start spending.
Another $53 million of the total $1 billion would go toward establishing a statewide health analytics platform to provide timely and actionable information for health care providers and policymakers. The Health Care Authority in September collected proposals to accomplish that goal.
“This initial work is critical to ensuring federal investments reach rural, frontier, and tribal communities effectively and responsibly,” Fowler wrote.
The state’s application also includes plans to spend $243 million expanding rural career pathways to health professions, establish a $123 million Center for Rural Health Sustainability and Innovation within the Health Care Authority and develop a $188 million grant program for local initiatives in rural, frontier and tribal communities.
Those three projects are listed as “under evaluation” on the Health Care Authority’s website.
Margaret O’Hara reports on issues affecting healthy communities in New Mexico. Her work is funded by a grant from Anchorum Health Foundation. Anchorum will not have any role in editorial decisions. The New Mexican and its Public Service Journalism Fund retain full editorial control. Philanthropically funded stories by The New Mexican are made available to all readers without a paywall.
