The Nebraska Department of Health and Human Services opened applications for three new grants Wednesday, focusing on workforce training, chronic disease management education and healthy food partnerships in schools.

The funding comes from the Rural Health Transformation Program (RHTP), a federal program aimed at strengthening rural health care that was created in last year’s One Big Beautiful Bill Act (OBBBA). The federal government awarded Nebraska nearly $1.1 billion to distribute within the next five years, broken up into yearly allocations of $218.5 million.

The first three grants will provide an estimated $40 million in funding for organizations that support these initiatives:

• Make Rural Nebraska Healthy Again Through Food as Medicine – Farmers, ranchers, food cooperatives, food pantries and nonprofits will partner with schools to provide access to healthy, locally grown foods. The initiative aims to reduce consumption of processed foods and reduce obesity risk. Grantees can use the funds for food safety and storage, delivery and logistics, nutrition education, equipment and community gardens. $10 million is available.
• Rural Health Care Workforce Incentive and Sustainability Model – Organizations that partner with the Supplemental Nutrition Assistance Program Employment & Training Program can receive funding to help SNAP recipients develop job skills for health care careers. $2 million is available.
• Chronic Disease Management Navigation and Education Initiative – Rural hospitals, clinics and other health organizations can use these funds to promote chronic disease management and care coordination. This education should support self-management, connect patients to health resources and aim to reduce emergency department utilization. While no funding total is given in the Request for Application, Nebraska’s preliminary budget allocated $26.9 million to this initiative for fiscal year 2026.

State officials have said the money will help future-proof rural health care through technology and disease prevention initiatives.

Some rural health leaders, like Nebraska Hospital Association President Jeremy Nordquist, have warned the funding won’t address systemic issues or fill the gap left by the OBBBA’s trillion-dollar Medicaid cut.

“Big picture, we're still concerned about enough of these dollars going first to help save hospitals and services that are in jeopardy,” Nordquist said. “We know that's what our members of Congress thought they were voting for. Then really, [Centers for Medicare and Medicaid Services] has been the one who kind of turned the dollars away from that initially – saying you couldn't use it to subsidize or supplement current reimbursements.”

He said rural hospitals across the state continue to reduce services or make cuts to stay afloat. Without intervention, more rural patients could face barriers to health care.

“We're going to see those services start to continue to close while we're announcing new, different programs with this funding,” Nordquist said. “And that's where a lot of the frustration from our members is kind of bubbling up related to this program.”

Workforce development and improved technology solutions were top priorities for rural hospitals as the application for federal funding was created. Nordquist said he is optimistic about those solutions based on Nebraska’s federal funding application.

“Those are all critical things that we're hopeful that we continue to work with the state to see investments in, because those are absolutely necessary to have a stronger rural health care system when these dollars go away in five years,” Nordquist said.

He added that many member hospitals will be applying for chronic disease management education grant funds. Deadlines for the grant applications are tight, and some grantees may only have a few months to spend any awarded funds.

“Especially among our smallest rural hospitals, it's proving to be pretty challenging for them to get out all the paperwork in order to compete for this funding stream,” Nordquist said.

Nebraska’s application for funding – including a preliminary budget – was released in early February. Nebraska DHHS said a revised budget was approved on Feb. 27 by the federal Centers for Medicare and Medicaid Services.

Additional RHTP grant opportunities will continue to be released each year over the next five years.

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