Federal Funding Available for Rural Hospitals


AUSTIN – Governor Greg Abbott announced Wednesday that the Texas Health and Human Services Commission (HHSC) is receiving up to $5 million in federal funding from the Centers for Medicare and Medicaid Services (CMS) as part of an innovative program to help serve underserved Texans in rural hospitals throughout the state.

"This funding will help Texans living in rural communities access medical care and health services they need and deserve," said Governor Abbott. "Our state is stronger when Texans are healthier, and I look forward to working with HHSC to continue improving the health outcomes for people across the Lone Star State."

"As we work to address health disparities throughout the state, this funding will help break down barriers to accessing care while connecting rural Texans with health care providers in creative ways and improving overall health outcomes within their communities," said HHSC Chief Financial Officer Trey Wood.

CMS selected HHSC as one of four recipients for this program designed to address health disparities, improve health outcomes, and meet the unique needs of Texans living in rural areas using telemedicine.

The Community Health Access and Rural Transformation (CHART) Model is a seven-year cooperative agreement funding opportunity for rural communities that face significant barriers to accessing health care. The funding will help rural hospitals maintain financial stability due to low patient volumes, high average fixed costs, and difficulty attracting and retaining a health care workforce.

Under the program, CMS is replacing Medicare fee-for-service claims reimbursement for participating rural hospitals with lump sum payments also called capitated payment amounts (CPA) for the duration of the program. This stable and predictable payment structure provides hospitals the freedom to invest in what is needed in their communities, such as essential primary care rather than having to rely on higher-reimbursing specialty services. The CHART Model CPA will be calculated by CMS.

HHSC is receiving up to $5 million in cooperative agreement funding and will award participating rural hospitals to redesign their health care delivery systems. HHSC will provide technical assistance, allow hospitals to purchase telemedicine equipment, training, software, and hire additional staff, if needed, to implement their programs.

The cooperative agreement funds will be awarded through a Request for Application process. Eligible communities include areas within: Angelina, Brown, Burnet, DeWitt, Dawson, Guadalupe, Haskell, Maverick, Polk, San Augustine, Wichita, and Young counties. However, HHSC may recruit additional participant hospitals from other areas of the state as funding allows.   

For more information about the CHART Model visit the CMS site

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