$50B Rural Health Fund Is Live — What It Means for HIEs & Last-Mile Interoperability

The CMS has opened a one-time application window for the new $50 billion Rural Health Transformation Program, with applications due November 5, 2025. The goal: strengthen access, quality, and infrastructure in rural health. (RHT Program) (Press Release)

For states, providers, and especially HIEs, this fund offers opportunities — and challenges. Here’s what to watch and why last-mile interoperability must be front and center.

What the Fund Covers

Some quick facts:

• States (not individual hospitals) apply, manage, and distribute the funds.

• The $50B is spread over five years (2026-2030), $10B/year. Half the funds go equally to all approved states; the other half are discretionary.

• Key priority areas include innovation/new service access, financial sustainability of rural providers, workforce, care model innovation (coordination, flexible models), and expanding digital health & data security infrastructure.

What This Means for HIEs & Last-Mile Interoperability

Here are the big implications, opportunities, and risks for HIEs and those working at the last mile of data exchange (community providers, behavioral health, EMS, etc.):

Opportunity	Challenge / Risk	What HIEs Can Do
Funding for digital health & data infrastructure — This is a chance to build or upgrade interoperable systems in rural areas: broadband, secure data exchange, patient matching, telehealth data flows, etc.	States may not prioritize last-mile providers explicitly. Funds could be funneled to telehealth or national vendors rather than supporting locally owned HIEs or grassroots data exchange.	Proactively engage state leadership to ensure HIEs are part of the transformation plans. Demonstrate ROI of local interoperability (e.g. outcomes, reduced duplication, better referrals).
Care model innovation and flexible care arrangements — These depend heavily on real-time or near-real-time data flow across settings: EMS, behavioral health, primary care, hospitals.	Without strong accountability or performance metrics tied to interoperability, states might off-load implementation to vendors who don’t integrate well. Also, technical gaps (legacy systems, connectivity) in remote areas could limit impact.	Offer technical assistance, share best practices, modular interoperability toolkits, help with standardization (FHIR, APIs). Consider partnerships with state agencies to help rural providers get up to speed.
Innovation in telehealth and access points — Telehealth depends on remote providers getting timely, actionable data (lab, imaging, prescriptions, referrals). HIEs can enable that.	Digital divide persists — poor broadband, lack of devices, low digital literacy. Also data privacy/security burdens, especially when integrating behavioral health, EMS, etc.	Build solutions that are low-bandwidth friendly; advocate for broadband investment; ensure strong security and consent frameworks; help with provider training. Use interoperable standards tailored to rural settings.
Long timeline, but minimal performance tie-downs — Once approved, funding runs through 2030 with annual reporting but no requirement to meet specific outcome benchmarks.	Risk of wasted investment or misaligned spending. Without benchmarks, it may be hard to ensure interoperability gains are measured and sustained. States may under-invest in accountability.	Propose interim milestones related to interoperability, data sharing, outcome measurement. HIEs can help states define metrics (eg. % of providers connected, % of transitions with shared data, reduction in readmissions). Become part of the measurement infrastructure.

Why Last-Mile Interoperability Matters

• Closing care gaps in rural and underserved areas often depends on seamless data flow to/from small clinics, EMS, behavioral health, social services. HIEs are the glue.

• Preventing duplication of tests, improving preventive care, enabling proactive outreach all depend on shared data.

• Crisis/emergency response, social determinants of health: these require cross-sector, real-time communication. Last-mile providers are front-lines.

Call to Action

If you work in an HIE, state health agency, or rural provider network, here’s what you can do now:

1. Get involved in your state’s application process. Offer input; ensure that last-mile providers are explicitly named.

2. Map existing interoperability gaps: Who is already connected? Who isn’t? What are the barriers (tech, funding, staffing)?

3. Build coalitions: Combine small clinics, behavioral health providers, EMS, public health, local government to make a stronger case for infrastructure investments tied to last-mile interoperability.

4. Set measurable goals for data sharing, outcomes, patient safety. HIEs are well-positioned to help define, collect, report those metrics.

Bottom Line

This $50B program is a major lever for rural health equity — but its impact will hinge on how well states and their partners use it to shore up the often-neglected last mile of health data exchange. If HIEs seize this moment, working at the edges of care, there’s real potential to transform access, outcomes, and sustainability in rural health. If they don’t, we could see another round of investment that leaves the hardest, most critical gaps untouched.