The federal Rural Health Transformation Program may sound the death knell for certificate-of-need laws in some states.
The rural funding program, created last year as part of H.R. 1, often referred to as the One Big Beautiful Bill Act, is a five-year, $50 billion program intended to offset some of the damage anticipated as a result of that law’s 10-year reduction in federal health care spending, and especially its Medicaid cuts, on rural health care.
While every state that applied for funding through the program was awarded grants, the Centers for Medicare & Medicaid Services has indicated that approval of some uses of Rural Health Transformation Program money may be tied to the elimination or reduction of CON laws. Program guidance encourages states to invest in programs that encourage greater competition for health care services – which CMS officials believe may help lower health care prices, improve access to care, especially in rural areas, and improve quality – and CON laws could make those objectives harder to achieve.
Currently, 35 states and the District of Columbia still have CON laws, although some of those programs have a narrower scope than they did in the past.
Learn more about the potential impact of the Rural Health Transformation Program on state CON laws – and its impact on rural health care in particular – from the Becker’s Hospital Review article “Trump administration targets CON laws—what it means for rural healthcare.”