New York State Rural Health Transformation Program

Executive Summary

NYSDOH provided an implementation update on New York’s Rural Health Transformation Program (RHTP), funded by a first-year CMS award of $212 million¹ covering 47 of the state’s 62 counties. The program is organized around four initiatives: Rural Community Health Integration (RCHI), Technology-Enhanced Primary Care, Rural Roots (workforce), and Investments in Technology Innovation and Cybersecurity Resilience.

The dominant theme of the webinar was the compressed federal timeline. All Budget Period 1 funds must be obligated by October 30, 2026 and spent by September 30, 2027, and future-year allocations are contingent on New York successfully obligating and spending those dollars. Any funds not obligated by October 30 are deducted from subsequent year awards.

RCHI, the first funding opportunity released, drew far more demand than available dollars: 91 applications containing 141 individual projects requesting more than $156 million against roughly $76 million available.  Award announcements are targeted for the end of August 2026, with the remaining three initiatives issuing funding guidance in fall 2026.

Key Takeaways at a Glance

• Total first-year CMS award: $212 million; five-year program subject to annual CMS review and approval of a non-competing continuation application.
• Eligible geography: 47 rural counties, identified by overlaying the Federal Office of Rural Health Policy rural definition with New York’s own definition (counties of 200,000 people or fewer).
• Hard obligation deadline: October 30, 2026 — meaning executed contracts, purchase orders in process, or staff hired. Approximately 70 grant and vendor contracts are expected to be obligated by that date.
• RCHI contracts end June 30, 2027 to allow invoicing and payment before the September 30, 2027 spending deadline.
• Not an operational grant: funds cannot sustain current operations, existing staff salaries, or overhead. Projects must be new.

Program Governance and Staffing

The program sits within the Center for Health Care Policy and Resource Development. A project director and project coordinator are now on board, and DOH will contract with a project support consultant.

Internal DOH partners (“spokes”) contributing subject matter expertise to individual initiatives include:

• Fiscal Management Group and Division of Legal Affairs
• Office of Health Services Quality and Analytics
• Office of Health Insurance Programs
• Office of Digital Strategy and Governance
• Office of Healthcare Workforce Innovation
• Hospital Transformation and Planning Program

Sister-agency partners include the Office of Mental Health, Office for People With Developmental Disabilities, Office of Addiction Services and Supports, and the State Office for the Aging.

Stakeholder input from nearly 170 organizations and community partners shaped the original application. An advisory workgroup is being formed and will convene this fall, drawing representation from provider groups and community-based organizations across the state.

Indicative Funding Allocation by Initiative

Figures below were stated verbally from memory during the webinar and flagged as approximate; DOH committed to publishing confirmed allocations on the program slides

Initiative	Approximate Budget Period 1 Allocation
Rural Community Health Integration (RCHI)	Slightly over $76 million
Technology Innovation and Cybersecurity Resilience	Approximately $75–80 million
Technology-Enhanced Primary Care	Approximately $30 million
Rural Roots (Workforce)	Approximately $15 million

Initiative 1: Rural Community Health Integration

Establish coordinated partnerships between rural facilities, providers, community-based organizations, and counties to facilitate care coordination. DOH is seeking to build or grow integrated health networks that enhance care coordination and outcomes, and to expand patient access across the full care continuum to address both health and social needs.

Status

• Funding guidance released June 11, 2026; applications due July 14, 2026.
• 91 applications received, containing 141 individual planning and implementation projects.
• Total requested: more than $156 million against approximately $76 million available.
• Reviews and funding recommendations in progress; DOH is targeting funding announcements by the end of August 2026.
• Projects must be completed by June 30, 2027 to ensure expenditure of funds by September 30, 2027.
• Budget Period 1 applications are closed and will not be reopened. A second round of RCHI funding guidance is planned for November 2026, and new applicants will be permitted in Budget Period 2.

Multiple applications within one county

DOH is reviewing applications on their merits and looking for opportunities to combine activities where multiple applicants serve the same county. This will be handled case by case, county by county, and affected applicants will hear from DOH directly.

Initiative 2: Technology-Enhanced Primary Care

Goal: improve access to and utilization of high-quality primary care by expanding the number of Patient-Centered Medical Homes across rural New York, directly advancing provider capacity to meet patient need.

• Grants to primary care practices for minor capital improvements (a CMS stipulation of the program) and staff training on best practices for patient need and accessibility, including improving Americans with Disabilities Act compliance.
• Grants to accelerate practice adoption of advanced analytics to improve operational efficiency, financial sustainability, and quality.
• Contractor scopes of work are being finalized. PCMH activities begin upon contract execution; funding guidance for the remaining components is planned for fall 2026, subject to CMS review and approval.
• Grant funds will be managed by a third-party administrator.
• Open question: whether accreditation bodies other than NCQA will be accepted for PCMH recognition. DOH noted this was a first-time question and will take it back for review.

Initiative 3: Rural Roots — Building a Sustainable Workforce

Goal: a comprehensive strategy addressing rural healthcare workforce shortages by recruiting and training more practitioners through combined planning, targeted education, and innovative support.

• Data-driven identification of local specialty gaps.
• Investment in early career exposure for students and support for enhanced clinical rotations.
• Strengthening employer-based training programs.
• Expansion of EMS education and supported training.

Status:

• Scopes of work being finalized for early career exposure and enhanced clinical rotations.
• Scope of work under development for broader workforce development activities.
• Memorandum of understanding being finalized for the workforce data analysis component.
• Funding guidance for the EMS project and the recruitment-to-service project expected in fall 2026.
• Local training program development has not yet entered contract negotiation.
• Funds will be administered by a contractor acting as third-party administrator.

Initiative 4: Technology Innovation and Cybersecurity Resilience

Goal: strengthen cybersecurity posture and invest in innovative care technologies across rural New York.

• Cybersecurity risk assessments for rural facilities.
• Expanded access to care through telehealth.
• Improved patient outcomes through eConsult partnerships.
• Improved care coordination alerts between healthcare agencies and rural counties.
• Strategic support for facilities and practices working with the Statewide Health Information Network for New York (SHIN-NY) and cybersecurity experts.
• Some projects will include artificial intelligence–enabled platforms.

Status and sequencing:

• Contractor scope of work for cybersecurity activities is being finalized.
• Budget Period 1 focuses on hospitals: all hospitals in eligible rural counties may participate. An introductory email was sent to those hospitals the week of the webinar.
• Budget Periods 2 through 5 will extend cybersecurity assessments to other provider types, including long-term care.
• Funding guidance for non-cybersecurity technology activities will be issued in fall 2026, with funds managed by a third-party administrator.
• School-based health center expansion will also be funded and administered through a third-party contractor.

Cybersecurity webinar: August 17, 2026, 3:00–3:30 PM. The session covers how the initiative will support rural provider resilience and continuity, plus future funding considerations. The invitation list is focused on hospital leadership — CEOs, chief information officers, and chief information security officers — drawn from contacts developed through New York’s first-in-the-nation hospital cybersecurity requirements. Whether other provider types can attend was taken back to the cyber team; materials will be posted publicly on the program website regardless.

Critical Dates and Compliance Timeline

Date	Milestone
August 17, 2026	Cybersecurity resilience webinar, 3:00–3:30 PM (hospital leadership focus)
End of August 2026	Target for RCHI funding announcements
August 31, 2026	First annual report due to CMS, covering December 29, 2025 through July 31, 2026
August 31, 2026	Non-competing continuation application due to CMS
Fall 2026	Funding guidance issued for primary care, workforce, and technology initiatives
October 30, 2026	All Budget Period 1 funds must be obligated; approximately 70 contracts expected
October 31, 2026	Budget Period 2 begins
November 2026	Budget Period 2 RCHI funding guidance planned; evaluation contractor guidance issued
November 29, 2026	Quarterly report due for the August 1 – October 30, 2026 period
June 30, 2027	RCHI project and contract end date
September 30, 2027	All obligated Budget Period 1 funds must be spent

What “Obligated” and “Spent” Mean

DOH clarified the two deadlines in response to multiple questions:

• Obligated by October 30, 2026: an executed contract with the Department of Health, purchase orders in process, or staff hired. “Executed” means an approved contract.
• Spent by September 30, 2027: funds actually paid out. Grantees and vendors effectively have one year to spend funds after obligation.
• Why contracts end June 30, 2027: grantees and vendors have 30 days after contract end to submit invoices and reports; DOH then needs time to review, confirm funds were spent as intended, and enter payments into the statewide financial system.

Procurement Flexibility and CMS Approval

The state budget includes authorization for the program along with “notwithstanding” language that waives certain State Finance Law procurement provisions. This allows DOH to move faster than standard state procurement timelines, which DOH stated would otherwise make it impossible to execute the program within CMS deadlines. A documented selection process is still required, and all activity remains subject to audit and CMS approval.

CMS review is required at two points: CMS has approved New York’s overall plan, but each funding guidance must be submitted for review and approval before release, and each negotiated budget and scope of work must be reviewed and approved by CMS before contract execution. The full contract does not go to CMS — only the budget and scope of work. DOH is running CMS submission concurrently with final contract execution to save time.

Questions and Answers

Question	DOH Response
Who will be on the advisory group?	Currently being formed with representation from provider groups and community-based organizations statewide.
Will new applicants be allowed in Budget Period 2 for RCHI?	Yes. New applicants will be permitted; Budget Period 2 guidance opens in November 2026. DOH encouraged both unsuccessful applicants and organizations that did not apply in round one to come back.
What does “not an operational grant” mean?	Funds cannot sustain current operations. DOH cannot fund salaries of existing employees or overhead. Projects must be new.
Will other PCMH accreditation bodies besides NCQA be allowed?	Not yet determined; DOH is taking the question back.
Are workforce partners already under contract?	No contracts are executed yet. Scopes of work are being negotiated for all workforce projects except local training program development.
Do contracts need CMS approval before DOH executes them?	The budget and scope of work require CMS review and approval, not the entire contract. Submission runs concurrently with final execution.
How can consultants or vendors offer services to awardees?	Monitor the DOH website for the awardee list and reach out to funded projects directly. DOH will not develop a preferred vendor list, unlike some other states.
Can rural pharmacies and pharmacists participate?	Yes, as partners within RCHI networks. Pharmacies were identified as an important provider link; interested pharmacies should connect with applicants and awardees in their region.
Is there funding for school-based health centers?	Yes. Funding will expand the school-based health center program, administered through a third-party contractor.
What is the administrative cap?	A 10% administrative cap was cited in the chat with reference to the CMS federal link.
Where can we find the slide deck and materials?	On the DOH “Transforming Rural Healthcare in New York” website. Slide decks are typically posted the same day; video takes longer. The deck will not be emailed to attendees.

Implications to Watch

• Demand exceeded supply by roughly two to one in round one, so Budget Period 2 positioning should begin now rather than in November.
• The October 30 obligation cliff means DOH will prioritize contract-ready partners. Organizations with governance, fiscal, and reporting infrastructure already in place carry a material advantage.
• Because three of four initiatives will flow through third-party administrators, engagement strategy differs by initiative: RCHI runs through county-level coalitions, while primary care, workforce, and technology funds run through statewide contractors.
• The absence of a state vendor list shifts the burden of business development onto vendors, making the published awardee list the primary market-entry document once released at the end of August.
• The administrative cap discrepancy between the 10% figure cited verbally and the 5% cap in the RCHI guidance should be resolved before budgeting any application.

Footnotes

¹ CMS cooperative agreement RHTCMS332049, $212,058,208 first-year award to the New York State Department of Health, https://www.highergov.com/grant/RHTCMS332049/. Program details: NYSDOH Transforming Rural Healthcare in New York, https://www.health.ny.gov/facilities/transforming_rural_healthcare/. RCHI allocation of $76.2 million per NYSDOH announcement, July 1, 2026.