South Dakota is getting nearly $190 million ($189.4 million) in federal funding for Fiscal Year 2026 to support a five-year (FY 2026–2030) federal initiative that focuses on strengthening healthcare systems in rural communities.
The Rural Health Transformation Program was established under the One Big Beautiful Bill Act and provides $50 billion in funding over five years to support state-led strategies that improve access, innovation and long-term sustainability in rural health.
Governor Larry Rhoden said this is one of the most significant healthcare infrastructure investments in South Dakota’s history. He said these resources will help modernize rural healthcare, support the workforce that delivers it and ensure that all South Dakotans have access to quality care – no matter where they live.
State Health Secretary Melissa Magstadt said South Dakota’s successful application for federal dollars was made possible through collaboration between the Governor’s Office, the Department of Health, the South Dakota Association of Healthcare Organizations, the state’s three major hospital systems– Monument, Sanford and Avera–, the Great Plains Tribal Leaders Health Board, provider associations and rural communities statewide. She said South Dakota’s collaborative approach– bringing together healthcare systems, Tribal nations, community organizations and state government– will help build solutions that work for rural communities.
Rhoden will share specifics about the Rural Health Transformation Program when he gives his State of the State Address Jan. 13, 2026.
For more information about South Dakota’s Rural Health Transformation Project, visit the DOH website, https://doh.sd.gov/healthcare-professionals/rural-health/rural-health-transformation-project/.
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