SALEM, Ore. (KATU) — Oregon is awarding about $97.1 million in additional federal funding this year to support new projects aimed at improving health care in rural communities across the state, the Oregon Health Authority announced Tuesday.
The funding will support 136 new projects in every Oregon county. With this latest round, Oregon has awarded about $175.3 million total this year to support health in rural communities.
“Overwhelming interest in this program demonstrates the need across Oregon,” Gov. Tina Kotek said. “At a time when Oregon’s healthcare system is facing significant funding shortfalls due to federal policies, I’m pleased to announce this next step in distributing funding to innovative projects that further the state’s goals to support maternal and child health, bolster the behavioral health workforce, and sustain safety net providers. Our goal is to move these funds as quickly as possible to these critical partnerships.”
The grants are supported by the federal Rural Health Transformation Program and are intended to back community-driven efforts that improve access to care, increase the number of health professionals working in rural areas, expand the use of data and technology in rural health care, and build regional partnerships for long-term improvements.
“These awards support practical, community-driven efforts to improve access to health in rural Oregon,” OHA Director Dr. Sejal Hathi said. “Rural communities know their needs best, and this funding is intended to help them strengthen local services, expand workforce capacity, and address barriers that make it harder for people to get care close to home.”
OHA said the awards are being offered through two funding pools. The largest, competitive Catalyst Award grants, will provide about $80.1 million to 85 organizations leading 103 projects focused on maternal and child health, co-occurring mental health conditions and substance use disorder, aging in place, or chronic disease. OHA said the selected organizations will support rural health in every Oregon county.
Another $17 million will go to Immediate Impact Awards for 33 ready-to-go projects this year. Those grants are in addition to an April announcement that OHA would provide $6.5 million in Immediate Impact Awards for 12 other shovel-ready projects this year.
OHA said the new Immediate Impact projects include expanding mobile health units in areas with limited health care infrastructure, creating a new family medicine residency training program to grow the rural health care workforce, and connecting patients with nutritious food to address diet-related conditions.
“OHA is quickly distributing grants through this unique federal funding source and looks forward to supporting Oregon’s rural communities as they improve their own health for years to come,” OHA Health Policy & Analytics Director Clare Pierce-Wrobel said. “While the total funding Oregon is receiving through the Rural Health Transformation Program is relatively small when you consider the full impact of recent federal Medicaid cuts, these awards can make a huge difference for individual organizations that are doing much-needed work in rural Oregon.”
OHA said Tuesday’s Catalyst Awards announcement includes the names of selected organizations and the maximum award amounts available, but exact grant amounts and other details will be finalized after award negotiations are completed this summer.
The announcement is the largest round of awards OHA has made since the federal government launched the Rural Health Transformation Program in late 2025. OHA said other rural health awards Oregon has made so far include $35 million in direct funding for rural hospitals; $21.7 million for the Tribal Initiative aimed at improving health care access and outcomes in rural Tribal communities based on the Nine Federally Recognized Tribes of Oregon’s needs; $10 million in direct funding for rural health clinics; and $5 million in direct funding for local public health authorities.
Federal-state partnership
The Rural Health Transformation Program was created by U.S. House Resolution 1, a federal tax and spending bill that became law in July 2025. OHA said the law will cut an estimated $15 billion in federal funding for Oregon programs that provide health insurance, food benefits and more, but also created the rural health program. The U.S. Centers for Medicare & Medicaid Services will distribute $50 billion nationwide between 2026 and 2031 through the program.
Oregon is receiving a total of $197.3 million in 2026 and could receive more in the following four years, OHA said. The federal government will determine 2027 funding after reviewing Oregon’s first annual progress report, which is due by the end of August.