Tennessee

The Rural Health Transformation (RHT) Program is a $50 billion initiative spanning FY2026–2030 to support system-wide change in rural health delivery nationwide. States compete for federal cooperative agreements to improve health care access, quality, sustainability, and capacity through technology innovation, workforce recruitment, and new payment and care models. Key priorities include chronic disease management, behavioral health, health IT, and sustainable rural provider access. Key contacts: MAHARural@cms.hhs.gov Event schedule: - NOFO release (expected) - September 15, 2025 - grants.gov - Applicant Webinar - September 19, 2025 - Application submissions close - November 2025 - Awards announced by - December 31, 2025

The State of Tennessee Department of Health is soliciting bids for marketing and advertising services to support its Rural Health Transformation Program (RHTP). Respondents must sign a nondisclosure agreement prior to accessing detailed solicitation materials. Registration with the State may take up to two weeks. Key contacts: Nicholas Edwards Nicholas.Edwards@tn.gov Event schedule: - Response Deadline - 08/26/2026 - CT - WRS Tennessee Tower 3rd Floor, 312 Rosa L. Parks Avenue, Nashville, TN 37243-1102

This document is Amendment #2 for Tennessee’s long-range Health Technology and Innovation RFA under the Rural Health Transformation Program. It clarifies eligibility, application expectations, eligible activities (including HIT, interoperability, and population health tools), and key deadlines. Service delivery is geographically limited to 89 rural Tennessee counties, and partnerships with FQHCs, rural hospitals, and technology vendors are encouraged. Key contacts: Competitive.Health@tn.gov Event schedule: - Pre-response Teleconference - 07/07/2026 - 1:00 PM CT - Teleconference link (referenced in document) - Deadline for Applications - 08/03/2026 - 2:00 PM CT - Evaluation Notice Released - 08/31/2026 - Effective Start Date of Contract - 09/15/2026 - Short-range contract end date - 2027-08-31 - America/Chicago - Tennessee - CMS Rural Health Transformation FAQ reference date - 2025-10-31 - Short Range RFA project completion (procured, implemented and reimbursed) - 2027-09-30 - Long Range RFA Year 1 start - 2026-09-01

Amendment #1 confirms deadlines for an RFA targeting rural hospitals, CAHs, clinics, and eligible partners to expand or co-locate key health service lines in rural TN. Eligible types include FQHCs, school-based clinics, RHCs, telehealth consortia, and collaborations. Supports minor interior renovations, equipment, workforce, and technology if tied to service expansion. Event schedule: - Pre-response Teleconference - 06/17/2026 - 1:00 p.m. CT - Teleconference Link - Deadline for Applications - 07/13/2026 - 2:00 p.m. CT - Evaluation Notice Released - 08/10/2026 - Effective Start Date of Contract - 09/01/2026 - RFA Amendment Release - 2018-09-20 - America/Chicago - Tennessee - RFA Amendment Effective Date - 09-20-18

This amendment clarifies eligibility, allowable costs, and program requirements for applicants seeking funding under the End Zone RFA targeting chronic disease prevention in rural Tennessee. Activities must include a Healthy Food Environment strategy, and eligible applicants may request up to three rural counties per application. Funding will support sustainable policy, systems, and environmental changes to improve rural health, with cost-reimbursement and detailed performance reporting required. Event schedule: - Pre-response Teleconference - 06/11/2026 - 1:00 PM CT - Teleconference-20260611 1916-1 - Deadline for Applications - 07/06/2026 - 2:00 PM CT - Evaluation Notice Released - 08/03/2026 - Effective Start Date of Contract - 10/01/2026

This application proposes a comprehensive $125 million investment in rural health transformation across Tennessee, with a focus on access, workforce, technology, and prevention. Major strategies include competitive grants for facility upgrades, EMS and mobile health expansions, primary/dental care access for the uninsured, workforce training pipelines, and sweeping policy modernization. Rural Tennessee's health challenges—chronic disease, maternal mortality, provider shortages, hospital financial distress—are directly targeted through coordinated initiatives and statewide collaboration.

This document provides detailed compliance, budgeting, reporting, and audit guidance to hospitals and subrecipients participating in Tennessee's Rural Health Transformation Program (RHTP) for FY2026. It clarifies eligible and ineligible costs, allowable activities, program caps, required documentation, records retention, procurement, and cash management expectations for federal funds. The guidance is designed to ensure alignment with both federal CMS award terms and state-specific initiatives under the Tennessee RHT Plan. Key contacts: Julie Murdock julie.murdock@us.forvismazars.com; Darshana Shyamsunder darshana.shyamsunder@us.forvismazars.com Event schedule: - Tennessee Hospital Association Rural Health Transformation Program – Compliance & Reporting Requirements April 2026 3.2 Electronic Medical Record System Replacement • No more than 5% of the award per budget period, can be used to replace an existing EMR system when a certified system existed before , 2025. 3.3 Rural Tech Catalyst Fund • Technology catalyst activities are not to exceed 10% of Tennessee’s award or $20 million, whichever is lower 3.4 Salaries and Wages • Funds cannot be used to support clinician salaries or wage supports for facilities that impose clinician non- compete contractual limitations • Non-clinician salaries may be allowable but only under the following conditions: o Directly tied to an approved RHTP initiative o Not used to supplant existing funding o Properly documented and allocable to the project. • HHS Executive Level II salary cap applies o Federal funds can only be used to pay for salaries up to the Executive Level II amount. Any amount above that cap must be paid with non-federal funds. o Executive Level II salary cap is $228,000 as of January 1, 2026 . 3.5 Provider Payments and Payments for Medical Services • Provider payments are capped at 15% per budget period • Funds cannot be used to cover services that could be reimbursed by insurance • Certain medical procedures are explicitly not eligible to be covered under the RHTP: o Procedures referenced at 45 CFR 156.400 o Payments consistent with SSA Section 2105© paragraphs 1, 7, and 9 3.6 Indirect Cost Rate and Calculation • Subrecipients may apply either a negotiated indirect cost rate approved by their cognizant agency or the de minimis rate, as allowed under 2 CFR 200.414(f). • Administrative costs, including both direct and indirect components, are subject to the federal 10% administrative cost cap established under Public Law 119-212. • The method for calculating indirect costs will vary depending on what rate is being used; cognizant agency approved negotiated rate or the de minimis rate. o Approved Negotiated Indirect Cost Rate A negotiated indirect cost rate is the rate that has been formally negotiated and approved by your cognizant agency for indirect costs. This rate is to be applied consistently across federal awards unless stated otherwise in the award terms. This rate may be based on different costs such as MTDC, salaries and wages, total direct costs, etc. An organization’s approved negotiated indirect cost agreement will specify which base for indirect costs is being used, and what the applicable rate is. To calculate indirect costs using a negotiated rate, an entity will multiply their agreed upon rate by the total of their base. See below for an example. Indirect Cost Base and Rate : Salaries and Wages at 25% Formula: 𝑇𝑇𝑇𝑇𝑇𝑇𝑇𝑇𝑇𝑇 𝑆𝑆 𝑇𝑇𝑇𝑇𝑇𝑇 𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆 𝑇𝑇 𝑎𝑎𝑎𝑎 𝑊𝑊 𝑇𝑇 𝑊𝑊 𝑆𝑆𝑆𝑆 × 25% = 𝐼𝐼 𝑎𝑎𝑎𝑎𝑆𝑆𝑆𝑆𝑆𝑆 𝐼𝐼 𝑇𝑇 𝐶𝐶 𝑇𝑇𝑆𝑆𝑇𝑇𝑆𝑆 - September 1 - Tennessee Hospital Association Rural Health Transformation Program – Compliance & Reporting Requirements April 2026 Total Salaries and Wages : $200,000 Calculation : $200,000 × 25% = $50,000 o De Minimis Rate According to 2 CFR 200.414 3 , indirect costs can be calculated using a de minimis rate of up to 15% of modified total direct costs (MTDC). Using the de minimis rate, indirect costs can be calculated using this formula: 𝑀𝑀 𝑇𝑇 𝑀𝑀 𝐶𝐶 × 𝑎𝑎𝑆𝑆 𝑚𝑚 𝑆𝑆𝑎𝑎𝑆𝑆 𝑚𝑚 𝑆𝑆𝑆𝑆 𝑆𝑆𝑇𝑇𝑇𝑇𝑆𝑆 = 𝑆𝑆𝑎𝑎𝑎𝑎𝑆𝑆𝑆𝑆𝑆𝑆𝐼𝐼𝑇𝑇 𝐼𝐼𝑇𝑇𝑆𝑆𝑇𝑇 Modified total direct costs (MTDC) are calculated by summing the costs included in the MTDC base under 2 CFR guidance, while excluding costs identified as ineligible. See the table below for a list of what MTDCs include and exclude. MTDC – Included MTDC - Excluded • Direct salaries and wages • Equipment • Applicable fringe benefits • Capital expenditures • Materials • Charges for patient care • Supplies • Rental costs • Services • Tuition remission, scholarships, and • Travel fellowships • Up to the first $50,000 of each • Participant support costs subaward • The portion of any subaward above $50,000. After the MTDCs have been calculated, the MTDC can be multiplied by the de minimis rate of 15% (or a lower percentage if chosen by your organization) to determine the indirect costs. See below for an example calculation using the 15% de minimis rate: Category Calculation Expenses Salaries & Wages: $500,000 $500,000 ×100%=$500,000 Supplies: $75,000 $75,000 ×100%=$75,000 Subaward 1: $250,000 $50,000 ×100%=$50,000 (Only the first $50,000 eligible for MTDC) Subaward 2: $45,000 $45,000 ×100%=$45,000 MTDC $ 𝟓𝟓𝟓𝟓𝟓𝟓 , 𝟓𝟓𝟓𝟓𝟓𝟓 + $ 𝟕𝟕 𝟓𝟓 , 𝟓𝟓𝟓𝟓𝟓𝟓 + $ 𝟓𝟓𝟓𝟓 , 𝟓𝟓𝟓𝟓𝟓𝟓 + $ 𝟒𝟒 𝟓𝟓 , 𝟓𝟓𝟓𝟓𝟓𝟓 = $ 𝟔𝟔 𝟕𝟕𝟓𝟓 , 𝟓𝟓𝟓𝟓𝟓𝟓 Indirect Costs Total $ 𝟔𝟔 𝟕𝟕𝟓𝟓 , 𝟓𝟓𝟓𝟓𝟓𝟓 × 𝟏𝟏 𝟓𝟓 % = $ 𝟏𝟏 𝟓𝟓𝟓𝟓 , 𝟓𝟓𝟓𝟓𝟓𝟓 4. Budgeting & Fiscal Management Requirements 4.1 Budget Planning and Documentation Subrecipient should expect to complete the following: • Develop a detailed line-item budget broken down by standard cost categories as follows: o Personnel & Fringe Benefits o Travel - Tennessee Hospital Association Rural Health Transformation Program – Compliance & Reporting Requirements April 2026 o Equipment o Supplies o Contractual o Other • Provide budget justification narrative to show how the budget items support the RHTP. • Provide multi-year budget projections for the entire budget period • Documentation of vendor or contractor selection methodology – consider procurement 4.2 Spending Window • RHTP funding is provided in annual budget increments and each budget period’s funds have a limited timeframe for use. • Funds awarded for a given budget period may be obligated and expended through the end of the subsequent federal fiscal year ( NOFO ). o For example, FY 2026 funds (Budget Period 1) can be used through , 2027. o Note, as a subrecipient, award periods may differ, so be sure to check for period of performance as listed in your subrecipient agreement with the State of Tennessee. • Unspent funds do not automatically carry over beyond the allowed period. Any RHTP funds remaining unspent after the end of the designated spending window for a budget period are subject to recapture by the State and return to the federal government (unless explicit written carryover approval is granted by CMS ) ( NOA ). o Subrecipients should carefully plan project timelines and monitor expenditures to ensure all funds are used within the allowed period for each budget segment. 4.3 Procurement When RHTP funds are used to award subcontracts or purchase goods and services, subrecipients must follow all federal, state, and organizational procurement rules. This includes the following: • Documenting competitive procurement processes (e.g., RFPs, bidding, or vendor selection criteria) • Avoiding any conflicts of interest in vendor selection. • Maintain records of procurement decisions and be prepared to provide this documentation to the State or auditors to demonstrate that all contracts were awarded in compliance with 2 CFR Part 200 procurement standards (see below). Federal Procurement Thresholds Procurement Size Federal Procurement Requirement Micro Threshold $10,000 or Less Procurement Requirements No bids or quotes required Small Threshold $10,000.01 - $250,000 Procurement Requirements Informal quotes required Formal Threshold $250,000.01 + Procurement Requirements Formal competitive process required 4.4 Draw Down and Cash Management Subrecipients are expected to follow federal cash management requirements when requesting, receiving, and disbursing RHTP funds, consistent with 2 CFR 200.305 and applicable HHS Payment Management System (PMS) provisions. - September 30 - Tennessee Hospital Association Rural Health Transformation Program – Compliance & Reporting Requirements April 2026 • RHTP advance funds may be requested only to support immediate cash needs for allowable program costs. Drawdowns are not intended to create cash reserves or cover projected future spending. • Subrecipients are expected to limit the time between drawing federal funds and disbursing them, in alignment with federal cash management standards. Funds should be disbursed within a short period after receipt. • Each drawdown request should be supported by documentation such as: o Expenditure details or general ledger records that support the amount requested, o Payroll records, invoices, contracts, or other source documents demonstrating allowability and allocability, and o Evidence of internal review and approval. • Subrecipients should maintain records demonstrating that drawn funds were disbursed promptly for authorized purposes and retain these records in accordance with federal record retention requirements. • Subrecipients are responsible for monitoring federal cash on hand. Excess balances should be addressed through delayed future drawdowns or returning funds, as directed by the State. • Noncompliance with federal drawdown or cash management requirements may lead to audit findings, enhanced monitoring, corrective action efforts, or other remedies under 2 CFR Part 200. 4.5 Program Income Subrecipients are expected to comply with federal program income requirements in accordance with 2 CFR 200.307 , and with the terms and conditions of the federal award. • Program income is defined as gross income earned by a recipient or subrecipient that is directly generated by a supported activity or earned as a result of the federal award during the period of performance, except as provided in 2 CFR 200.307(c). • Program income includes, but is not limited to: o fees for services performed, o income from the use or rental of real or personal property acquired under federal awards, o proceeds from the sale of commodities or items fabricated under a federal award, o license fees and royalties on patents and copyrights, and o principal and interest on loans made with federal award funds. • Interest earned on advances of federal funds is not considered program income and must be handled in accordance with federal cash management requirements. • Subrecipients are responsible for tracking, documenting, and reporting program income in accordance with federal award terms and applicable regulations. • Program income must be used and accounted for as directed by the federal award, and records must be retained in accordance with federal record retention requirements. • Failure to account for or use program income in alignment with these requirements may result in audit findings, enhanced monitoring, corrective action, or other remedies under 2 CFR part 200. 5. Reporting Requirements 5.1 Reporting Overview Subrecipients must be prepared to submit reports to the State of Tennessee using the specific instructions and templates they provide ( FAQs ). Anticipated reports might include the following:

The Tennessee Department of Health has launched a roll-out of competitive grant programs starting May 15, 2026, with multiple opportunities released weekly through July 10, 2026. The program focuses on areas such as perinatal and pediatric behavioral health, chronic disease prevention, healthcare resiliency, and rural health modernization funded also through TennCare Shared Savings. Applicants have 30 days from each release date to submit applications, with resources and webinars provided for support. Key contacts: Competitive.Health@TN.gov; RuralHealth@TN.gov Event schedule: - Rural Healthcare Access Modernization Program (RAMP) Initial Announcement - May 15, 2026 - Perinatal and Pediatric Behavioral Health Teleconsultation and Education Application Period - May 15 to June 15, 2026 - Healthy Active Rural Tennessee (HART) Application Period - May 22 to June 22, 2026 - Healthcare Resiliency Program (HRP): Maternal Child Health Application Period - May 29 to June 29, 2026 - Chronic Disease Prevention Application Period - June 5 to July 6, 2026 - County Health Council CARE Grants Application Period - July 10 to August 10, 2026