Alaska could see up to $1.36 billion for rural health over the next 5 years
- Alaska Beacon
- Dec 30, 2025
- 3 min read
By Claire Stremple
Alaska Beacon
Alaska was awarded more federal money than any state besides Texas for a federal rural health initiative, the Centers for Medicare & Medicaid Services announced on Monday.
The money will come from the Rural Health Transformation Fund, a $50 billion program set up as part of the One Big Beautiful Bill Act and intended to counteract the effects of its sweeping Medicaid cuts in rural areas.
Alaska’s congressional delegation and state officials lauded the federal investment, which will be upwards of $272 million in Alaska in 2026.
At a Wednesday news conference in Anchorage, Sen. Dan Sullivan, R-Alaska, said the $1.36 billion the state is slated to receive over the next five years is the biggest investment from the federal government to Alaska’s health care system in state history.
“This is a generational opportunity for our state,” he said.
Heidi Hedberg, commissioner of the state’s health department said a major goal is to rework the state’s “fragmented” health system.
She said the agency will release more information about its plan for the money in the coming days, but pointed to the state’s application to the program, which outlines six priorities: maternal and child health, access to services, preventative care, a strengthened workforce, financial sustainability and updated technology and data systems.
Emily Ricci, the agency’s deputy commissioner, said that core to the state’s application was the question of how to support services that already exist in the state.
“Part of our focus was making sure that the tribal communities could see some of the ways that they want to sustain their programs and evolve or build their programs out further into something that provides more access and sustainable costs,” she said. “So I would say that those opportunities are written in each one of the initiatives.”
She did not immediately supply specific examples.
The state’s application also commits to adherence to several policies favored by the Trump administration, including a pledge to join licensure compacts and prohibit the use of federal Supplemental Nutrition Assistance Program funds to buy soda pop by 2027.
Several of those commitments require the approval of the state’s legislature or medical board.
Hedberg said her agency will work with those decision makers to follow through on the commitments the state made in its application.
In a virtual meeting with reporters after the state’s news conference, Sen. Lisa Murkowski, R-Alaska, challenged the state administration and legislators to take on the question of rebuilding the state’s health care system as a major issue.
In response to a reporter’s question, she said she was worried about the reliability of the funding because the state could fail to make the most of the opportunity or because the federal government could pause or cancel the funding.
“I know that we’re going into an election year next year. I know that the Permanent Fund always takes up space. I know we’re going to be talking about the gas line,” she said. “But we must, we must absolutely be talking about this health care opportunity that we have in front of us now.”
• Claire Stremple began reporting in Alaska in 2018 as a public radio reporter in Haines. Since then, she has reported across the state on the health environment, education and justice beats. Previously, she was the Managing Editor of the newsroom at KTOO Public Media. Alaska Beacon is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.
