Grant Funds Available to Boost Rural Health Care. Five Questions Answered

The American Rescue Plan Act included $500 million for a program called the Emergency Rural Health Care (ERHC) program. The program is intended to assist with broadening access to COVID-19 testing and vaccines, rural health care services, and food assistance. It is administered by the U.S. Department of Agriculture Rural Development. The USDA recently released details on applying for the grants.

What Types of Grant Funding are Available?

There are two eligible funding tracks under the ERHC:

1. Track One Recovery Grants. These grants are to provide immediate relief to address the economic conditions arising from the COVID-19 emergency. Grant funds must be used in relation to the COVID-19 pandemic and to support immediate health care needs, to help prepare for a future pandemic event, or to increase access to quality health care services and improve community health outcomes. Grant awards range from $25,000 – $1 million.
2. Track Two Impact Grants. These grants are available to advance ideas and solutions to solve regional rural health care problems to support the long-term sustainability of rural health care. Long-term sustainability is defined as “improved health outcomes, improved access to quality health care, and creating and maintaining sustainable economic development for small communities.” Grant funds must be used in relation to the COVID-19 pandemic. Grant awards range from $5 million – $10 million.

How is Eligibility Determined?

Eligible applicant types include public bodies, community-based nonprofits, and federally recognized Tribes. Facilities and projects must be located in – and primarily serve – rural areas. Rural areas are defined as including cities, villages, towns, townships, and federally recognized Tribal lands with no more than 20,000 residents as determined by the latest U.S. Census Data are eligible for this program.

An additional requirement for Track Two applicants is they must also establish a network or group of entities that consist of health care provider organizations, economic development entities, federally recognized Tribes or institutions of higher learning (which may include academic health and research institutes).

What are Eligible Projects or Uses?

Track One Recovery Grants: There are eight eligible categories:

1. Increase capacity for vaccine distribution
2. Provide medical supplies and equipment to increase medical surge capacity
3. Reimburse for lost health care related revenue used to maintain capacity during the pandemic
   • CPA certification. It is important to note that for lost revenue applicants, a CPA must certify the calculation of health care-related lost revenue requested is accurate and in alignment with previous years’ revenue.
4. Increase telehealth capabilities, including underlying healthcare information systems
5. Construct temporary or permanent structures to provide health care services
6. Support staffing needs for testing or vaccine administration
   • CPA certification. A CPA must certify staffing expenses have not been reimbursed from other Federal or state resources
7. Support facilities, equipment, and operating expenses associated with food banks and food distribution facilities
8. Pay professional service fees and charges, but only when such expenses are a necessary part of an allowable facility or project

Applications for the above costs or lost revenues may not be funded already through other sources.

Track Two Impact Grants. The eight eligible uses of these grants are:

1. Establish or scale a regional partnership or group of community and health care leaders to plan, implement, and evaluate models to help solve regional health care problems and promote the long-term sustainability of rural health care
2. Establish or scale evidence-based models and share lessons learned
3. Identify a health-related problem within a region, develop and implement a method and solution, and conduct a program evaluation to examine health-related outcomes, long-term sustainability, and ability to successfully replicate
4. Establish a methodology to calculate summary impact measures or an estimated return on investment for the grant funds requested, including job creation and retention numbers, and improvements to quality of life
5. Cover the cost of technical assistance to assist with one or more aspects of project implementation, project evaluation, data sharing, and reporting requirements
6. Cover indirect costs in an amount up to a federally negotiated indirect cost rate
7. Make sub-awards in the form of a grant, cooperative agreement, or contract, as appropriate, to other members of the consortium, or to other service providers such as technical assistance providers
8. Pay professional service fees and charges associated with the grant request

Track Two applicants are encouraged but not required to consider the following areas of higher need: development of integrated health care models, reducing facility bypass whether through telemedicine or business plan adjustments, telehealth, electronic health data sharing, workforce development, transportation, paramedicine, obstetrics, behavioral health, farmworker health care, cooperative home care, and supporting health care as a small community, anchor institution.

Are Matching Funds or Cost-Sharing Required?

Yes. Grant funding will be distributed using a graduated scale with higher amounts awarded and lower cost-sharing for applicants with smaller populations and lower median household incomes, based on the following:

• Up to 75% when the proposed project is located in a rural community having a population of 5,000 or less and the median household income of the population to be served by the proposed facility is below the poverty line or 60% of the State nonmetropolitan median household income, whichever is greater.
• Up to 55% when the proposed project is located in a rural community having a population of 12,000 or less and the median household income of the population to be served by the proposed facility is below the poverty line or 70% of the State nonmetropolitan median household income, whichever is greater.
• Up to 35% when the proposed project is located in a rural community having a population of 20,000 or less and the median household income of the population to be served by the proposed facility is below the poverty line or 80% of the State nonmetropolitan median household income, whichever is greater.
• Up to 15% when the proposed project is located in a rural community having a population of 20,000 or less and the median household income of the population to be served by the proposed facility is below the poverty line or 90% of the state nonmetropolitan median household income, whichever is greater.

In-kind contributions are not an acceptable source of cost-sharing funds.

What are My Next Steps?

The deadline to apply for these grants is October 12, 2021. Track One Recovery Grants are assessed on a first come basis. If you are interested in these grants, your next steps are to review the USDA’s ERHC webpage for additional details and reach out to CLA for assistance.