Arkansas awards $54M in second round of federal rural healthcare funding

Arkansas awarded $54.6 million to dozens of recipients through a new federal program to support projects aimed at bolstering rural healthcare, state officials announced Thursday. 

Established through a 2025 federal tax and spending law called the One Big Beautiful Bill Act, the Rural Health Transformation Program will provide $50 billion to states over five years. Arkansas is expected to receive approximately $1 billion. 

Critics of the program have said it lacks transparency, which could make it difficult to protect against fraud, according to KFF, a nonprofit health policy and research group.

Arkansas’ version of the program includes four pillars, including the Healthy Eating, Active Recreation, & Transformation initiative and the Recruitment, Innovation Skills, and Education for Arkansas priority, which received $27.4 million and $27.2 million, respectively, according to a press release. 

The funding awarded to these initiatives “represent strategic investments designed to strengthen health, wellness and workforce capacity” for the state, Arkansas Health Secretary Renee Mallory said during a press conference at the governor’s mansion Thursday. 

Arkansas awards nearly $150 million in rural health program funding

The 54 funded projects announced Thursday include training new maternal nurses to serve north central Arkansas and the River Valley, recruiting doulas from underserved communities and creating a “food is medicine” farm-to-clinic model through the University of Arkansas for Medical Sciences, Sanders said.

The program, which will change the trajectory of health in small-town Arkansas, is much more than another funding stream to the healthcare industry, Sanders said. 

“It’s an effort to fundamentally transform what it means to provide healthcare in Arkansas,” she said. “Local, individual and focused on serving the whole person, not just their latest injury or illness.”

Sanders last month announced $149.3 million for 50 projects that fall under the Arkansas program’s other two areas — the Telehealth, Health-Monitoring, and Response Innovation for Vital Expansion initiative and the Promoting Access Coordination and Transportation priority. 

The program’s funding arrives as states prepare for the effects of the One Big Beautiful Bill Act, which could reduce federal Medicaid funding in rural areas by $137 billion over 10 years, according to KFF estimates. Rural providers see larger proportions of patients insured through Medicaid.  

The federal law, signed by President Donald Trump last year, is expected to reduce federal spending on Medicaid by about $1 trillion during the next decade to help pay for tax cuts that disproportionately benefit the wealthy. 

Providers warn that the state’s healthcare system could be further strained by the end of Arkansas’ hybrid Medicaid expansion that covers more than 200,000 people. 

The state asked for a two-year extension to develop a replacement for the program after the Trump administration rejected the state’s renewal request.