When Congress assembled the health sections of the One Big Beautiful Bill – or as it’s now known, “an act to provide for reconciliation pursuant to title II of H. Con. Res. 14” – there were several pieces that came together as olive branches to various members. While some branches are good policies, others should have been pruned, raked up, and hauled away. One of those branches is the Rural Health Transformation Program (RHTP). With the announcement this week by Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Mehmet Oz that the applications for this funding will open in September, it seems like an appropriate time to assess this program.

The $50 billion RHTP (to be spent at a rate of $10 billion per year over five years) was – at a high level – conceived to make up shortfalls in other federal health funding. But while masquerading as an innovative government program, the RHTP is little more than a slush fund. There is no transparent formula for funding determinations, and instead the CMS administrator has immense discretion in determining state eligibility and allowable program expenditures, setting the stage for funding decisions based on personal taste rather than well-reasoned formulas with defined variables (see questionable criteria, below). The RHTP funds will be doled out in two ways. First, $5 billion of the $10 billion per year is meant to be evenly divided among participating states with an approved RHTP application. The second $5 billion has an amorphous set of criteria listed in the legislation for who gets what:

• the percentage of the State population that is located in a rural census tract of a metropolitan statistical area (as determined under the most recent modification of the Goldsmith Modification, originally published in the Federal Register on February 27, 1992 (57 Fed. Reg. 6725));
• the proportion of rural health facilities (as defined in subparagraph (D)) in the State relative to the number of rural health facilities nationwide;
• the situation of hospitals in the State, as described in section 1902(a)(13)(A)(iv); and
• any other factors that the Administrator determines appropriate.

Once the total funding plan is allocated and approved, there are numerous things a state can spend the money on:

• Promoting evidence-based, measurable interventions to improve prevention and chronic disease management.
• Providing payments to health care providers for the provision of health care items or services, as specified by the Administrator.
• Promoting consumer-facing, technology-driven solutions for the prevention and management of chronic diseases.
• Providing training and technical assistance for the development and adoption of technology-enabled solutions that improve care delivery in rural hospitals, including remote monitoring, robotics, artificial intelligence, and other advanced technologies.
• Recruiting and retaining clinical workforce talent to rural areas, with commitments to serve rural communities for a minimum of 5 years.
• Providing technical assistance, software, and hardware for significant information technology advances designed to improve efficiency, enhance cybersecurity capability development, and improve patient health outcomes.
• Assisting rural communities to right size their health care delivery systems by identifying needed preventative, ambulatory, pre-hospital, emergency, acute inpatient care, outpatient care, and post-acute care service lines.
• Supporting access to opioid use disorder treatment services (as defined in section 1861(jjj)(1)), other substance use disorder treatment services, and mental health services.
• Developing projects that support innovative models of care that include value-based care arrangements and alternative payment models, as appropriate.
• Additional uses designed to promote sustainable access to high quality rural health care services, as determined by the Administrator.

So, how might this all shake out? Will we transform rural health care, as the administration’s sales pitch says we will? Based on some back-of-the-envelope math, the answer seems to be no. I did some calculations to determine what potential funding under the RHTP might look like. I assumed all 50 states submitted and received approval for their applications (though this is not a given), and that the scaled amount of the second bucket was tied directly to the rural population percentage of each state. While my math can’t account for the personal discretion part of the RHTP – I am not the CMS administrator – this seems like a pretty good approximation of what the funding magnitude might or should be.

According to the administration, the RHTP “will provide unprecedented new funding to states for a range of uses designed to make rural healthcare more effective and sustainable for the long term.” While an admirable goal, the paltry funding in this program will hardly make a dent. Take Maine, for example, which spends approximately 20 percent of its GDP (about $19 billion) annually on health care. My calculations (based on a flat distribution and an amount weighted and scaled to Maine’s rural population percentage) give the state approximately $321 million, less than 2 percent of the state’s annual health spending.

To be clear, there’s no easy solution to rural health challenges. The demographics of each state should inform how it designs its “transformation programs.” But even the most well-intentioned innovation can’t patch over the kind of shortfalls rural patients face. Some communities are worried about simply keeping rural health clinic doors open to serve patients. Maine’s (potential) $321 million to “promote innovation and efficiency” when rural health facilities face longstanding challenges even staying open seems like a misalignment of priorities. Based on some recent estimates, more than 700 rural hospitals – nearly one-third of all rural hospitals in the country – are at risk of imminent closure; more than 300 of these hospitals are at immediate risk of closing. The “development and adoption of robotics” – one of the allowable RHTP expenses – may not even crack the top 10 things a critical access hospital is thinking about.

Against that backdrop, this $50 billion slush fund may feel more like triage than transformation. Never has a program this new needed reform so badly.