PIERRE, S.D. — The federal government will deliver $90 million to South Dakota through the Rural Health Transformation Program to speed digital health modernization, strengthen cybersecurity and improve interoperability for rural and underserved communities, officials announced Wednesday.
Funds aimed at technology, workforce and connectivity
The Biden-era program’s successor under the current administration was cited as the vehicle for the award, which state and federal officials said will be used to update infrastructure, support health workforce needs and expand technology-driven care across the state’s geographically dispersed communities.
Health and Human Services Secretary Robert F. Kennedy Jr. said the investment is intended to put “resources directly into rural communities” and to give states flexibility in designing solutions. Centers for Medicare & Medicaid Services Administrator Dr. Mehmet Oz also framed the funds as part of a broader federal push to improve care in rural areas.
“President Trump understands that every American deserves high-quality healthcare, no matter where they live,” said Health and Human Services Secretary Robert F. Kennedy, Jr.
Governor Larry Rhoden welcomed the announcement, saying the funding will support technology and tools for rural providers and help more South Dakotans access care. State officials did not release a detailed breakdown of how the $90 million will be allocated by county, provider type or specific project in the initial announcement.
What the money is expected to target
Officials described several broad priorities for the award:
- Digital health modernization — upgrading electronic health records, telehealth platforms and other clinical IT systems;
- Cybersecurity — investing in defenses to protect patient data and provider systems;
- Interoperability — improving the ability of disparate systems to exchange and use health information; and
- Workforce and innovation — supporting training and new care models tailored to rural populations.
Federal officials tied the funding to a larger package they said was enabled by the Working Families Tax Cuts Act, a multiyear national investment program enacted by Congress. That legislation was characterized in the announcement as providing a major infusion intended to reshape how health services are delivered in rural America.
Local impact and remaining questions
Health systems and clinics in South Dakota’s small towns have long cited limited broadband, aging IT systems and workforce shortages as challenges to expanding telehealth and coordinating care. The new funding could pay for modernized networks, upgraded clinical software and shared services that smaller providers often cannot afford on their own.
State health leaders will need to clarify how the awards will be distributed among public health agencies, critical access hospitals, community clinics and tribal health organizations. Observers say transparency about selection criteria and project timelines will be important to ensure the money reaches underserved areas.
Officials stressed accountability and outcomes as part of the program’s design. In the initial statement, federal leaders said states would be given flexibility to develop solutions "around the people they serve, while demanding accountability for results." Details about reporting requirements, measurable performance goals and the period covered by the funding were not provided in the release.
| Program | Announced amount | Primary goals |
|---|---|---|
| Rural Health Transformation Program | $90 million | Digital modernization, cybersecurity, interoperability, workforce support |
Next steps for South Dakota providers and patients
State and federal officials said more information would follow about application processes, eligible projects and timelines. Health providers interested in potential funding opportunities should watch announcements from the South Dakota Department of Health and the governor’s office for guidance on how to apply or partner on proposals.
For rural residents, the announcement raises hope for expanded telehealth options, more resilient systems that protect their data and better-connected care when patients move between hospitals, clinics and specialty providers. How quickly those improvements show up in communities will depend on program rules and the speed of state-level implementation.
The initial announcement framed the funds as a turning point for rural health services in South Dakota, but significant decisions remain about how to translate the $90 million into concrete projects that reduce gaps in coverage and improve patient outcomes.
