Six States Target Hospital Regulations for Federal Funding
Six states plan to reduce hospital regulations in exchange for federal funds under Trump’s Rural Health Transformation Program.
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Under the Trump administration’s incentives, six states have announced plans to review and potentially eliminate their Certificate of Need (CON) hospital regulation laws in exchange for federal funding. Tennessee, Alaska, Connecticut, Delaware, Iowa, and Mississippi are considering ending these regulations, which are designed to control costs and require hospitals to seek approval before expanding or establishing new facilities.
Federal Incentives for Regulatory Reform
The One Big Beautiful Bill Act (OBBBA), signed by President Donald Trump in July 2025, has spurred these changes. The Center for Medicare and Medicaid Services (CMS) launched a $50 billion Rural Health Transformation Program, allocating funds to rural hospitals in states that re-evaluate their CON laws. The program aims to provide an additional $10 billion annually from 2026 to 2030, with the goal of improving rural healthcare access and sustainability.
Impact of Regulatory Changes
CMS emphasized that states with fewer CON rules would receive higher scores and more funding. Tennessee has taken the most significant action, passing a bill to gradually remove most of its remaining rules over four years. As of May 2025, 35 states have CON laws, but nearly half have indicated plans to loosen or eliminate them.
Public Skepticism and Policy Outcomes
Despite these efforts, skepticism remains among rural voters who support the ‘Make America Healthy Again’ movement. A KFF-Associated Press poll found that 68% of rural voters aligned with the movement believe the administration’s policies have had a negative impact or no effect on local health outcomes.
Source: Daily Caller
