Iowa set to receive $216 million in second year of federal rural healthcare program

Iowa was awarded $216 million from the Centers for Medicare and Medicaid Services for the second year of the state’s rural health care improvement plan, “Healthy Hometowns.” This funding comes as part of the Rural Health Transformation Program, the federal grant program created as part of the 2025 “One, Big, Beautiful Bill” Act in an effort to offset losses for healthcare providers caused by Medicaid cuts. The 2025 law is set to reduce federal Medicaid spending by $911 billion over ten years, according to Congressional Budget Office estimates. The Rural Health Transformation Program is set to offer states a total of $50 billion in grants over five years. This will not be enough to offset the estimated funding losses, but Republican leaders have said these investments offer targeted funding to help address specific needs in states like Iowa, such as funding for cancer prevention services and expansion of rural healthcare access.

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