North Carolina Launches Fund to Enhance Rural Health Care with $20 Million Investment
In a significant move to improve health care infrastructure for rural communities, North Carolina has introduced the Rural Health Innovation Fund. This initiative, announced by the North Carolina Department of Health and Human Services and the North Carolina Department of Information Technology, is set to provide approximately $20 million annually over the next five years. The goal is to empower rural health providers to modernize their operations, ensuring better patient care and facility management.
Governor Josh Stein emphasized the importance of accessible health care for all residents, stating, “North Carolinians need access to high-quality health care no matter where they live.” The fund aims to leverage technology, allowing rural providers to connect patients with necessary services closer to home, thus enhancing community health care delivery.
Dev Sangvai, the Secretary of NC Health and Human Services, highlighted the alignment of this fund with the department’s mission to revolutionize rural health care and improve accessibility. He remarked that this funding enables providers to utilize technological advancements, facilitating patient access to necessary care irrespective of their location.
Rural health providers face unique challenges such as limited funding, staffing shortages, and insufficient technological infrastructure, making it difficult to keep up with digital advancements in health care. The Rural Health Innovation Fund is designed to help these providers identify, evaluate, and implement digital solutions that can fortify their practices and enhance patient care.
NCDIT Secretary and State Chief Information Officer Nate Denny noted the critical understanding rural providers have of their community needs. He stated, “The Rural Health Innovation Fund will give providers the opportunity to explore promising digital solutions, learn what works and put the right tools to work for their patients and communities.”
During its inaugural year, the fund is available to primary care providers, federally qualified health centers, community health centers, and safety net providers meeting certain federal health center standards. Applicants must demonstrate their service to rural populations, even if located in non-rural counties.
Eligible organizations can apply for funding to trial and expand digital solutions aimed at improving care, reducing operational difficulties, and maintaining patient-provider connectivity. Potential projects include telehealth services, AI-driven clinical decision tools, upgrades to electronic health records, and cybersecurity enhancements, all designed to be scalable and sustainable for rural communities.
Providers interested in the first round of funding must complete an online assessment, obtain quotes, and submit an application through the NCDIT grant portal by 11:59 p.m. on November 16, 2026. Awards are expected to be announced in January 2027, with projects to be completed by July 30, 2027, on a reimbursement basis.
This fund is a component of North Carolina’s Rural Health Transformation Program, which seeks to advance health care services in rural areas, ensure the continuity of rural health care services, and improve health outcomes. With North Carolina possessing the second-largest rural population in the U.S., challenges such as a shortage of health care providers, hospital closures, and high rates of chronic conditions are prevalent.
The federal Rural Health Transformation Program provides states with opportunities to enhance health care in rural areas through technological improvements and workforce strengthening. In December 2025, CMS allocated over $213 million to North Carolina for the first year, with the possibility of additional funding over the subsequent five years.
Despite these funding opportunities, North Carolina faces significant budgetary challenges due to the federal reconciliation law H.R. 1, which results in the loss of nearly $50 billion in federal Medicaid funding over the next decade. The NCDHHS is committed to utilizing the available resources effectively while advocating for additional support for the state’s rural health care system.
Stevens Amendment Disclosure: This news release is supported by the Centers for Medicare & Medicaid Services (CMS) of the U.S. Department of Health and Human Services (HHS) as part of a financial assistance award totaling $213,008,356.47 with 100% funded by CMS/HHS. The contents are those of the author(s) and do not necessarily represent the official views of, nor an endorsement by, CMS/HHS or the U.S. Government.
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