On July 4, 2025, the “One, Massive, Stunning Invoice Act” (OBBBA) was signed into legislation. Its backers hailed it as a car for progress, whereas critics known as it the quiet dismantling of America’s healthcare security web.
OBBBA slashes Medicaid and ACA subsidies whereas inflating the deficit with trillions in tax cuts. Tens of millions stand to lose protection, and safety-net hospitals will face new monetary instability. And rural well being techniques, already stretched to the breaking level, might be examined like by no means earlier than.
However there’s one other angle right here. There could also be a possible inflection level inside this sweeping laws.
The $50 billion Rural Well being Transformation Program (RHTP) is modest in comparison with the cuts surrounding it, but it surely forces Rural America to do one thing our broader healthcare system has resisted for many years, and would do properly to study from: innovate out of necessity.
OBBBA is a stress check, and the result is determined by how we reply.
Why U.S. Healthcare Is So Laborious to Repair
Let’s stage set. America’s healthcare system is dear, ineffectual, and formed by counterproductive incentives. We spend practically twice as a lot as different high-income nations, but outcomes lag behind. Continual illness administration, maternal mortality, and life expectancy all inform the identical story: excessive value, low return.
One purpose is the hole between conventional healthcare and well being tech. Well being tech has proven a willingness to innovate quickly. However conventional healthcare is official and laborious to penetrate, missing the urge for food for change that startups take as a right.
This creates a gulf the place well being tech builds the instruments, however conventional healthcare hardly ever integrates them at scale. Hospitals usually function on 1-2% margins, leaving little room for experimentation. Their constructions reward stability over velocity and agility, making it extraordinarily tough to check, undertake, and scale new tech.
I’ve seen this gulf firsthand. As a important care and pulmonary doctor, I’ve labored inside the standard system, the place skinny margins and inflexible constructions go away little house for innovation. And as an entrepreneur, I’ve piloted expertise designed to make care extra environment friendly, solely to look at hospitals battle to undertake some very sensible options.
Contemplate Normal Catalyst’s recent $485 million purchase of Summa Well being by means of its Well being Assurance Transformation Company (HATCo). Summa is a big, nonprofit system in Ohio with hospitals, clinics, and a medical health insurance arm. HATCo is popping it right into a for-profit testing floor for brand new applied sciences and care fashions.
The truth that a enterprise capital agency wanted to purchase a complete well being system simply to create a testing floor for innovation underscores the dimensions of the issue. It’s not that hospitals don’t see the worth of contemporary expertise; it’s that their working constructions, monetary realities, and regulatory obligations make speedy adoption practically unattainable.
OBBBA widens this hole by destabilizing the system, but it surely additionally opens a door.
Rural Fragility and the RHTP
Rural hospitals sit on the intersection of skinny margins, workforce shortages, and geographic boundaries. Greater than 100 rural hospitals are already at risk of closure, and over 600 are thought-about weak nationwide. The whole system is fragile.
I feel the time period rural fragility is apt: a situation the place suppliers function so near the sting that even minor shocks can tip them into crisis.
Not like city or suburban techniques that may lean on diversification and endowments, rural suppliers lack a cushion. They usually don’t have Chief Innovation Officers, CMIOs, or capital budgets for brand new infrastructure. They depend on outdated digital techniques, their affected person quantity is small, and their payer combine is disproportionately Medicaid and Medicare. The situations that make them fragile additionally make them structurally immune to adopting trendy well being tech.
The RHTP, carved out within the OBBBA, makes an attempt to intervene at this breaking level. It dedicates $50 billion in grants and incentives over the subsequent decade to assist rural suppliers modernize operations, undertake digital instruments, and pilot new care fashions. Whereas the greenback determine is dwarfed by the trillion-dollar Medicaid cuts surrounding it, this system forces a shift that rural suppliers can’t keep away from any longer.
Critics argue that $50 billion over a decade is a band-aid in comparison with the dimensions of Medicaid cuts. They’re proper. However this system’s significance isn’t in its uncooked measurement.
Its potential lies in its function as a forcing operate, compelling fragile techniques to rewire themselves for the longer term. If necessity is the mom of invention, rural fragility may be the mom of transformation.
By no means Let a Good Disaster Go To Waste
RHTP is important due to the commitments it forces. This system ties funding to transformation, requiring rural hospitals to improve digital infrastructure and allow interoperability, telehealth, and compliance techniques. And by subsidizing modernization, it lowers the monetary boundaries which have saved rural techniques from adopting and scaling trendy instruments.
If deployed properly, RHTP funds might assist rural techniques lead in areas the place conventional well being has lagged:
- Digital-first care: Rural communities, the place distance makes in-person care impractical, might mannequin what virtual-first care actually seems to be like.
- Staff-based care because the norm: There are already nice examples of team-based care in main medical facilities, however rural settings might want to lean on this mannequin as doctor shortages have hit them the toughest.
- Fashionable compliance and high quality techniques: Rural suppliers can’t afford armies of directors. Adopting digital compliance instruments and embedding high quality assurance into each day work, moderately than including layers of paperwork, might make oversight sustainable.
- Proper-sized amenities: Not each neighborhood wants a full-service hospital. Modular pressing care, power illness administration, and cellular clinics might serve sufferers higher at decrease value.
Success gained’t be discovered by patching the previous system. It’ll be about constructing one thing new beneath strain.
And if these interventions are deployed properly, the ROI might far outweigh the preliminary funding. Telehealth has been proven to save lots of sufferers $147 to $186 per visit in prevented journey and misplaced productiveness, whereas distant affected person monitoring packages have delivered a 22% positive ROI and diminished hospitalizations by hundreds of {dollars} per affected person.
These are only a fraction of the outcomes that we might see from good implementation.
The Paradox of Fragility
What’s most weak may also be most transformative. Rural fragility is actual, however once more, necessity is the mom of invention. Rural suppliers can’t delay adoption. In the event that they don’t reinvent themselves, they may collapse.
For many years, well being tech corporations have constructed instruments that promise better entry, effectivity, and high quality. However conventional healthcare has all the time been constrained by operational drag that retains promising applied sciences caught in pilot purgatory, or perceived solely as a luxurious.
RHTP might change this dynamic by tying survival to modernization. It forces rural techniques to open the door that has separated them from the well being tech innovators. So the query is: will conventional healthcare undertake the mindset of fast iteration and user-centered design that well being tech has embraced for years?
If RHTP succeeds, it might produce classes for the remainder of the nation. activate groups in another way. construct high quality techniques with out pointless purple tape. make expertise the spine of supply as an alternative of an elective add-on.
The stakes are very excessive, but when performed proper, rural well being might shift from being the canary within the coal mine to the proving floor for fashions that make your complete U.S. healthcare system extra environment friendly and extra patient-centered.
The Selection That Shapes the System
Can we cling to previous fashions and look ahead to failure, or can we embrace the instruments, crew constructions, and supply strategies that this disaster calls for?
RHTP might symbolize the final greatest probability for rural America to innovate earlier than the protection web tears fully. For the nation, it could possibly be the blueprint for escaping a system that’s overpriced and underperforming.
As a doctor, I’ve seen how disaster redefines the potential. And as an entrepreneur, I consider necessity could cause transformation. However most significantly, as somebody who has labored alongside sufferers, suppliers, and innovators, I do know the ingenuity and resilience on this discipline.
We’ve been given no alternative however to innovate, and it must occur quickly. Regardless of the difficulties we’re going through, I stay hopeful that we are going to seize this second to construct a system that delivers on the promise of healthcare: accessible and compassionate take care of all.
About Rafid Fadul, MD, Co-Founder & CEO, Zivian Health
Rafid Fadul, MD, MBA, is an completed digital well being government, firm advisor, serial entrepreneur, and triple board-certified pulmonary important care doctor. Dr. Fadul was the founding Chief Medical Officer at Wheel Well being and continues to function an advisor for a number of well being tech corporations and on the Board of Administrators for Ureteral Stent Firm, BestLife Holdings, and MedWish Worldwide. Dr. Fadul can be an adjunct professor at Johns Hopkins, educating programs in well being economics.
