Transforming Rural Health Through Innovation and Evidence

CMS’s Rural Health Transformation Program (RHTP) offers the opportunity to redesign rural health systems at scale. Advancing rural health transformation requires coordinated support across policy, financing, analytics, and implementation—areas that must work together to produce measurable results for access and outcomes in underserved communities.

• For federal leaders: Success depends on the ability to optimize program operations, measure and improve performance, generate timely insights to guide decision making at scale.
• For states and providers: Implementing rural health transformation requires navigating complex program requirements, building partnerships, and developing solutions that reflect local needs while remaining evidence-based and moving forward.

Rising healthcare costs make it critical for policymakers and program administrators to have clearer visibility into what’s driving spending growth and where interventions can have the greatest impact. Pricing and utilization data can help target reforms and track whether they improve access and reduce unnecessary spending.

Tools such as Mathematica’s Rural Health Potentially Avoidable Utilization (PAU) Dashboard give more than 1,600 rural hospitals nationwide insight into how PAU in emergency departments and inpatient settings impacts Medicare revenue—helping them identify where to invest to reduce potentially preventable, unplanned care.

We’ve also been a partner in developing resources such as a hospital cost tool and a health systems dashboard that provide policymakers and researchers with accessible data on hospital pricing, quality, and outcomes. These insights support federal and state leaders in making more informed decisions about where to invest and how to improve the efficiency of rural health systems.

Implementing rural health transformation requires coordination across agencies, providers, and community partners, often under tight resource constraints and evolving federal requirements. Building local capacity is critical to sustaining rural health transformation efforts over time. Technical assistance and training can help states and providers design and implement programs, monitor and evaluate efforts, and drive performance and quality improvement. This includes supporting CMS and states in implementing and evaluating Section 1115 demonstrations, aligning payment and delivery system reforms, and generating action-ready evidence to inform policy decisions. For example:

• The Rural Emergency Hospital (REH) designation allows communities that can’t support a full-service hospital to maintain 24-hour emergency, observation, and outpatient services. Through the REH Technical Assistance Center, Mathematica provides advisory services, financial modeling, virtual learning opportunities, and educational resources to guide hospitals through the transition process.
• As part of the Medicaid and Children’s Health Insurance Program (CHIP) Learning Collaboratives initiative, Mathematica helps the Center for Medicaid and CHIP Services provide high-priority policy and operational technical assistance to states and use program data to promote high-performing state health coverage programs.
• Mathematica leads the Technical Assistance and Analytic Support Program for CMS’s Medicaid and CHIP Quality Measurement and Improvement Program, which includes support for a core set of health quality measures. We provide support to states to reliably report these measures and use them to inform decisions about policies, programs, and practices to improve care quality.

To curb rising costs and sustain rural healthcare, CMS and other payers are testing new approaches that reward care coordination, preventive care, and community health partnerships. These alternative payment models—including hospital global budgets—aim to stabilize financing while improving services for rural residents.

Designing and implementing these models requires coordination across payers, providers, and policymakers, along with strong financial modeling and data infrastructure to support decision making. In collaboration with the Rural Health Redesign Center and the CMS Innovation Center, our financial and data technical assistance is helping rural hospitals in Pennsylvania translate global budget models into practice.

Rural communities face unique challenges that heighten behavioral health needs—from provider shortages and geographic isolation to economic stress and limited access to broadband and transportation.

In many rural communities, improving behavioral health outcomes depends less on expanding a single service and more on coordinating care across primary care, social services, and community-based supports.

Mathematica works with the federal and state governments, health systems, and community organizations to strengthen behavioral healthcare by identifying gaps in services, evaluating what works, and translating evidence into practical strategies for states and providers.

We analyzed a large health system in the Dakotas and rural Minnesota that integrated behavioral health into primary care—leading to improved quality-of-care processes and reduced emergency department use. We’ve also studied programs that support parents with substance use challenges who are involved in the child welfare system, helping identify strategies to promote recovery and family reunification. These insights guide the development of scalable, evidence-based solutions tailored to rural realities.