How WA’s $181M in rural health funding stacks up with other states

The money comes from a new federal program meant to offset reductions in Medicaid spending approved in Republicans’ ‘big, beautiful bill’

Washington is set to receive $181 million in federal funding this year to boost rural health care amid drastic Medicaid cuts.

The hefty sum falls below what the Trump administration gave to some other states, and the rough average of $200 million to each. But the state is in the middle of the pack when it comes to funding per rural resident.

The return on Washington’s application for $1 billion over the next five years from the $50 billion Rural Health Transformation Program didn’t necessarily come as a shock.

“I don’t think anyone was surprised that we received less than 200,” said Jacqueline Barton True, the Washington State Hospital Association’s vice president of advocacy and rural health. “We certainly internally had operated under the impression that we weren’t going to get $200 million.”

To Elya Prystowsky, the executive director of the Rural Collaborative, the award was a “pleasant surprise.”

“I would have been happy if we got $100 million,” said Prystowsky, whose organization represents Washington’s rural hospitals. “So $181 million is $81 million of gravy, as far as I’m concerned.”

Texas topped the list of funding recipients with $281 million, but the state has over 30 million residents compared to 8 million in Washington.

Alaska got the next largest share, $272 million, followed by California and Montana, both with about $233 million.

Democratic-led states tended to fare worse than those run by Republicans. Less rural states also got less money.

Half of the $50 billion fund will be evenly distributed to all states with approved applications. But assessing how the rest of the money is distributed is complicated because it factors in the number of rural residents and medical facilities in each state, among other things.

Washington, which is less rural than many other states, was in the bottom 10 for funding awarded last week. The state has also had a tense relationship with the Trump administration and is at odds with it on health policy issues.

Here, the hospital association will help dole out infrastructure funding the state receives as part of the federal program. The association’s Barton True expects the state to start spending the money within a couple months.

If the award stays the same over the next five years, Washington would receive about $906 million. But the money states get will be recalculated each year.

Washington aims to use the money for an array of initiatives to not just boost rural hospital finances but reshape the health care system in these communities.

This includes investing in new technologies, growing the rural health workforce, improving health care in tribal communities, building more community-based care and expanding the rural behavioral health system. Over $300 million was earmarked for hospital infrastructure in the state’s application.

“We could do a lot of good work with $181 million,” Prystowsky said.

It’s unclear what work may be on the chopping block due to the lower-than-requested funding.

The state Health Care Authority is working to trim its budget plan, but not eliminate any ideas entirely. That revised plan is due to the U.S. Centers for Medicare and Medicaid Services by the end of the month.

“Although our state did not receive the full amount requested, we remain committed to improving the health and wellbeing of people living in rural Washington,” Health Care Authority spokesperson Rachelle Alongi said in an email.

Congress created the new funding stream to help make up for heavy cuts to Medicaid that are expected to disproportionately hurt rural health care providers. Advocates say the $50 billion won’t fill the gap Republicans created last year with their so-called “big, beautiful bill,” which reduced Medicaid spending to help offset the expense of lowering taxes.

“This funding will not replace the dramatic cuts imposed by the Republican-led Congress and the White House,” Washington Gov. Bob Ferguson said in a statement, “but these funds will help fortify rural communities against what’s to come. It is a significant investment in Washington’s rural health care.”

In Washington’s rural communities, federal spending from Medicaid, the health insurance program for low-income Americans, is set to drop over $4 billion in the next decade, according to an analysis by nonpartisan health research group KFF.

The sums from the rural health fund per rural resident varied widely across states, according to a KFF analysis released Tuesday.

Despite relatively modest awards, New Jersey and Rhode Island are getting the most dollars per resident in rural communities, according to KFF.

While big states like California and Texas and some states in the Midwest are getting under $100 per resident. Washington’s award is $162 for each of its 1.1 million rural residents, the KFF data show, landing the state 29th on the list of awards when using that metric.

Zachary Levinson, the lead author of the KFF analysis, noted 10 states are receiving less than $100 per rural resident, while eight states received more than $500.

A demerit for Washington also came from its alignment — or lack thereof — with the Trump administration’s “Make America Healthy Again” policies. These policies include reestablishing the Presidential Fitness Test and restricting how federal food stamp benefits can be spent.

A Centers for Medicare and Medicaid Services spokesperson said the funding amounts were based on a formula that includes a “combination of data-driven factors, merit review of RHT plans, and objective evaluation of state policy actions and commitments to those policies.”

“CMS did not require states to adopt any specific policy to receive funding, and politics played no role in funding decisions,” the spokesperson said Tuesday.