Main Street Monday: USDA $50 Billion Guaranteed Lending Availability for Rural Health Care
December 15, 2025
Bob Coleman
Founder & Publisher
Main Street Monday: USDA $50 Billion Guaranteed Lending Availability for Rural Health Care
The National Rural Lenders Roundtable was held in Washington DC last week to examine the expanding role of federal rural health funding and the opportunities for lenders in this niche with USDA’s Community Facilities program.
The session was moderated by Bill Broydrick, a long time NRLR lobbyist with deep experience in federal policy. The panel featured Carrie Cochran-McClain and Brittany Roy-Morales. Carrie serves as the chief policy officer for the National Rural Health Association and is widely recognized for her work on the financial stability of rural hospitals. Brittany represents the National Governors Association and advises governors on rural health strategy, public health systems, and statewide transformation planning.
Bill Broydrick:
The fundamental problem in rural America comes down to the cost and the financial health of the healthcare industry. Rural hospitals generally depend heavily on Medicare and Medicaid, which are not as lucrative as commercial insurance. As a result, we’ve seen a significant number of rural hospital closures.
But in the One Big Beautiful Bill, Congress on a mandatory basis allocated $50 billion dollars over five years for rural hospitals. We heard the distinction between mandatory and discretionary earlier this morning. We have two guests here who are experts on this program. Brittany from the National Governors Association and Carrie from the National Rural Health Association.
The reason I asked them to join us is that we already have an existing program within USDA called Community Facilities. That program limits lending when private sector guaranteed loans can cover part of the cost. Their perspective helps us understand how the new funding fits with the lending tools we already use. I will turn it over to them to explain the program, and I will start with Carrie. I want to thank both of them for being here. I appreciate Brittany in particular because the National Governors Association played a major role in making this happen. Since I am the one saying it, I will pat myself on the back for inviting her.
So here is what this legislation brought to rural America. $50 Billion.
Carrie Cochran-McClain, Chief Policy Officer of the National Rural Health Association:
I am going to walk through the parameters of this new program. I am with the National Rural Health Association, and our role is to present the issues facing rural healthcare at the national level, which is the same environment all of us work in on the lending side.
The Rural Health Transformation Program, and I want to make one quick distinction from what Bill said, was created during the debate around the One Big Beautiful Bill and the discussion of community eligibility policy and its long term impact on rural hospitals. The program is broader than rural hospitals alone. That has become a concern among stakeholders who want to ensure the money truly reaches rural communities, rural people, and rural facilities.
The program provides $50 billion over five years. It is divided into two tranches.
The first tranche is the baseline funding. Every state that submits a transformation plan receives $1 billion per year for five years, for a total of $5 billion. Every state submitted a plan, so every state receives the baseline funding regardless of how rural it is.
Bill:
Let me ask one question. I think in Connecticut there are three rural hospitals. So they have a billion dollars a year to divide up among the rural parts of Connecticut. Rhode Island and New Jersey get the same amount as Alaska, California, and Texas. And how many rural hospitals are in New Jersey? Maybe one? Maybe none?
Carrie:
Exactly. That’s the issue, baseline funding goes to every state regardless of rurality.
Tranche Two is the discretionary $25 billion, allocated according to three factors:
1. Rural indicators – how rural your state is, what condition the facilities are in, and the health indicators of the rural population.
2. Transformation plan quality – the initiatives proposed by the state.
3. Policy incentives – whether the state is making changes in areas under its control, like scope of practice.
States were required to write to key strategic goal areas:
• Prevention and treatment (the “Make Rural America Healthy Again” agenda)
• Sustaining rural healthcare providers
• Workforce recruitment and retention
• Care innovation and value-based models
• Technology and data modernization: AI, remote monitoring, health information exchange
On construction, there is room for construction and renovation up to 20 percent of a state allocation, but not for new hospitals in every county. CMS set parameters to prevent the money from being used to build a new rural hospital everywhere.
On timing, the bill passed on July 4. Applications were released six weeks later and were due six weeks after that, which created a rapid turnaround for a program intended to transform rural healthcare systems. CMS must make funding decisions by the end of the calendar year. States must begin spending on January 1, and if they fail to meet spending deadlines or milestones, the funds can be pulled back.
Brittany Roy-Morales:
I think you captured it accurately. I work on rural health at the National Governors Association. NGA represents all 55 governors. That includes the 50 states along with Puerto Rico, Guam, the Northern Mariana Islands, American Samoa, and the United States Virgin Islands.
NGA operates through two main arms. Government relations advocates to Congress and the administration on behalf of the governors in a bipartisan manner. Best practices is where I work. We never tell governors what to do. We give them considerations, whether it is Medicaid provisions in HR1, healthcare affordability, maternal and child health, or other issues in the health space.
Before joining NGA, I served as senior advisor to Governor Asa Hutchinson in Arkansas. Rural life is part of my background. My fathers side worked livestock and my mothers side worked row crops, so this work is personal to me.
We recently framed rural health as a strategic opportunity in both economic and public health terms. Rural America produces the nation’s food, energy, and much of its industrial output. If rural communities remain healthy, the rest of America benefits.
What are we seeing in state applications? Priorities are consistent:
• Workforce
• Telehealth
• Infrastructure
• Chronic disease management
• Facility modernization
• Mobile care
• EMS redesign
• Maternal and child health
• Payment model redesign
Payment reform is central. Southern states are focusing on immediate stabilization through global budgets, bridge funding, and right sizing. Northern and western states are concentrating on long term sustainability through value based payment, shared savings, and service line redesign.
Infrastructure modernization includes both physical and technological reinvestment. Some states want their rural facilities connected to the state health information exchange, but cybersecurity must come first and that requires significant investment.
Workforce remains one of the largest challenges. The question is how to attract providers, teachers, and other professionals to live and work in rural areas. That connects directly to the non medical drivers of health that shape whether a community can support and retain talent.
Bill:
Let me come to the point. These two ladies have $50 billion. Think about that. It’s going to be a very good Christmas at HHS.
USDA, through the Community Facilities program, has a guaranteed lending outlet that can provide capital for rural hospitals and rural healthcare. These organizations now have much stronger balance sheets. That creates a real business opportunity for you.
My advice:
• Talk to rural healthcare operators who are potential borrowers.
• Work with the trade associations in your states.
• Engage with governors’ offices or state health departments.
A lot of rural hospitals need replacement, not just renovation. I spent most of yesterday at a rural hospital in Delaware, and let me tell you—it could use some sprucing up.
There’s a real private-sector opportunity here to partner with these facilities, strengthen them, and improve rural healthcare.
Brittany:
I’ll add there are going to be some tough budget choices, no matter the politics. States are facing tax-revenue shortages and Medicaid pressure. Strategic public-private partnerships will be essential. If you don’t know your state’s economic development lead or health advisor, you should. Everything is on the table. And NGA can help connect you.
Bill:
Thank you both for being here, and we hope we can all work together and benefit from this public-private package.
And for $50 billion—have a Merry Christmas. I’m adding that to my list.