Full Breakdown
Trump Administration Links Rural Hospital Funding to State Repeal of CON Laws
By Drooid · · How we work
Federal Funding Tied to CON Law Repeals
On October 19, 2026, the Trump administration announced that a portion of the $50 billion Rural Health Transformation Program will be awarded to states that end or loosen certificate of need (CON) laws, which require state approval for new hospital construction or expansion. The Centers for Medicare & Medicaid Services indicated that applications from states with fewer CON restrictions will receive higher scores, effectively using funding as a “carrot” to encourage policy change.
Background on Certificate of Need Laws
CON laws, in effect in more than 30 states and Washington, D.C., were originally intended to curb monopolies and control costs by requiring providers to demonstrate community need. Critics argue the statutes have instead raised prices, delayed facility development, and limited rural patients’ access to new technology. The Rural Health Transformation Program was added to President Trump’s One Big Beautiful Bill Act as a mechanism to modernize care in remote areas.
State Actions and Funding Implications
Six states—Tennessee, Alaska, Connecticut, Delaware, Iowa and Mississippi—have signaled plans to revisit their CON statutes in funding applications. Tennessee, which will receive an equal share of half the program’s grants, passed a bipartisan bill in April to unwind most remaining CON rules over four years. The state’s hospital association opposed the repeal in a 2024 letter, warning of higher costs and staff shortages. In July 2025, Williamson Health’s board approved a $900 million sale of its network to Ascension St. Thomas, reflecting market shifts linked to the policy environment.
Opposition and Concerns
Martin Chaney, CEO of Maury Regional Health, contended that eliminating CON regulations would create “rural healthcare deserts” by prompting hospitals to expand only in profitable areas. Judy Herbert, a Williamson County commissioner, warned that the repeal could force smaller hospitals to close or be sold, concentrating expensive procedures in large systems. Maureen Hensley-Quinn cautioned that removing CON requirements may reduce transparency, making it harder for states to track ownership and private-equity transactions.
Verbatim Quotes
- “If there's an issue where you can have President Obama and President Trump in agreement on something, that tells you the idea probably has some merit,” — Wes Climer, a Republican state senator in South Carolina
- “Without CON, without ownership reporting, and without an entity that monitors transactions or providers in that way, there's no way for you to know,” — Maureen Hensley-Quinn