The North Carolina Department of Health and Human Services has launched a public dashboard detailing the initial allocations of its five-year Rural Health Transformation Program. The online tool outlines the local projects, counties served, committed spending, and program descriptions established during the initiative's first year.
The launch coincides with a notification from the U.S. Centers for Medicare & Medicaid Services that North Carolina will receive an initial $100 million award to begin its second year of funding, with additional federal support anticipated to follow. The federal government created the five-year program to support health care improvements in rural areas, where state progress and ongoing federal decisions influence annual funding levels.
More than 3.5 million people live in rural North Carolina, giving the state the second-largest rural population in the United States. Many of these communities experience structural challenges, including shortages of local medical providers, high rates of long-term health conditions, unequal access to care, and the persistent threat of rural hospital closures.
In its first year, North Carolina secured $213 million in federal funds through an award totaling $213,008,356.47, funded entirely by CMS and the U.S. Department of Health and Human Services. State health officials obligated the entirety of the Year 1 allocation across regional networks, direct emergency care expansions, and statewide workforce initiatives. Funded projects have until September 2027 to spend their Year 1 budget allocations.
The largest portion of the initial funding—$123.5 million—was designated for six regional networks that encompass all North Carolina counties. Operated through NC ROOTS Hub Leads, these regional structures bring together local health departments, care providers, and community partners. Hub staff spent four months conducting regional needs assessments to establish local investment priorities and direct funding toward area challenges.
Another $11.2 million was awarded to 40 local Emergency Medical Services agencies across the state. This funding is targeted at creating or expanding Mobile Integrated Health programs, allowing paramedics to administer opioid treatment and specialized care directly in patients' homes without requiring unnecessary emergency room transport.
Beyond regional hubs and emergency services, the transformation program targets six main operational areas: connecting physical, behavioral, and social care networks; managing chronic disease and maternal health; expanding mental health and school-based crisis services; creating recruitment and retention programs for rural medical workers; establishing new quality-focused provider payment models; and upgrading health information technology and digital tools.
State rules limit administrative overhead—such as staffing, monitoring, evaluation, and fraud prevention—to no more than 10 percent of the overall budget. For the first year, administrative costs were budgeted at $16.5 million, representing 7.7 percent of the total federal allocation.
Governor Josh Stein emphasized that every resident deserves high-quality medical care near home, as reported by a local news report. NC Health and Human Services Secretary Dev Sangvai told a local news report that the program's primary objective is to meet people where they live by ensuring essential services are accessible close to home.
While state officials are deploying the transformation funds to strengthen rural health delivery, broader federal legislative changes present ongoing budget headwinds. The same federal statute that established the Rural Health Transformation Program, H.R. 1, included provisions that reduce federal Medicaid funding to states. Because of those statutory reductions, North Carolina is projected to lose tens of billions of dollars in overall health care funding over the next decade.
