BOISE, ID – Idaho was awarded hundreds of millions of dollars in federal funding this summer to improve rural health care, but exactly how the state will use that money remains a debate among state lawmakers.

Meanwhile, leaders at Idaho’s rural hospitals are increasingly concerned the state may lose out on the money as those hospitals face critical needs for new equipment or other infrastructure upgrades.

“They’re extremely frustrated and extremely concerned,” Idaho Hospital Association Vice President Toni Lawson told the Idaho Capital Sun.

As part of the federal One Big Beautiful Bill Act approved by Congress in July, Idaho was awarded nearly $930 million to use over five years as part of the federal $50 billion Rural Health Transformation program to support rural health care access and affordability. The first year’s worth of grants must be awarded by Oct. 30, or the state will have to return the money.

There are two competing bills in the Idaho Legislature to create a legislative task force to direct those grants. To use the money, the Idaho Department of Health and Welfare will need the state budget-writing committee to provide the “spending authority,” or permission to do so.

Idaho Falls Republican Sen. Kevin Cook sponsored Senate Bill 1264, which would create a seven-member task force that would require at least three legislators to represent rural districts.

“Legislators, we hold the purse strings; that’s our duty,” Cook told the Sun. “We’re supposed to have that money and be accountable to it, not the governor.”

Cook’s bill has been held on the Senate’s calendar, postponing the vote, since Feb. 23.

In the House, Coeur d’Alene Republican Rep. Jordan Redman sponsored House Bill 862 to create a nine-member task force with no requirements that legislators come from rural districts. Redman’s bill on Friday was sent to what’s called “general orders,” which allows it to be amended.

The co-chair of the budget-writing Joint Finance-Appropriation Committee, Rep. Josh Tanner, told the Sun that the budget writers are waiting to see what happens with potential policy bills directing the money before granting the spending authority for it.

The state has around $186 million to spend in the annual grant, some of which may be used in the current fiscal year, which ends June 30.

A separate task force convened by Idaho Gov. Brad Little outside of the legislative session outlined a plan in the state’s application, but state lawmakers say that it is their constitutional obligation to direct money now that it’s been awarded.

Idaho’s application centered on five initiatives: 

• Initiative 1: Improving rural access to care through technology.
• Initiative 2: Ensuring accessible, quality care through innovative models.
• Initiative 3: Sustaining rural workforce with training, recruitment and retention.
• Initiative 4: Implementing population-specific, evidence-based projects to make rural America healthy again.
• Initiative 5: Investing in rural health infrastructure and partnerships.

Both legislative proposals would require the group of lawmakers to create a scoring method for awarding subgrants, oversee the use of the grants and make legislative recommendations that align with the initiatives in the application.

Rural hospitals are advocating for funds to be distributed 

Nearly 50% of Idaho hospitals have less than 60 days worth of cash on-hand, Lawson said. With so little cash available, investments like a new MRI or upgrading an operating room are out of reach, she said.

“In my 20 years (with the hospital association), I have never been worried about whether or not we’re going to have one or more hospitals close,” Lawson said. “Right now, I’m worried. I don’t know if people understand how financially vulnerable some of our rural hospitals are right now.”

These hospitals are hoping they will be able to apply for grants to make some of these big, one-term purchases to increase the services they can provide or help recruit and retain new physicians, she said.

There’s also support for some of the ideas outlined in the application to use money to boost medical education training and health care workforce development in rural areas.

Rural hospitals have been struggling under cumulative factors, such as rising pharmaceutical costs, Idaho’s rapid population growth, and the state’s 4% Medicaid provider pay rate cuts implemented in August to address a projected state budget shortfall.

This year, the Legislature is weighing additional cuts to services, including a proposal to repeal the Medicaid expansion program, which covers around 80,000 Idahoans. Medicaid will likely see further reductions, as the One Big Beautiful Bill Act reduced the federal Medicaid budget by around $1 trillion over the next decade.

Idaho U.S. Sen. Mike Crapo previously told the Sun that the rural health care funding was a priority of his in the massive federal spending package.

Crapo said he thought the concerns about how Medicaid budget reductions will affect states were “overstated,” but the concerns about rural health care were not.

“These hospitals need help now,” Crapo said in August.

What’s happening with the funds in the Idaho Legislature?

Cook told the Sun that his bill to create a task force seems to be stalled over disagreement regarding the makeup of his proposed task force. SB 1264 would require the group to comprise three members of the House, three members of the Senate, and one nonvoting member selected by the governor.

At least three of the legislators on the committee would need to come from a district that has no city with a population of 20,000 or more.

“You’ve got to have somebody that’s in a rural area that’s going to answer to the rural hospitals,” Cook said. “I felt pretty strongly about that.”

Redman’s bill, HB 862, would require four members of each chamber and one nonvoting member selected by the governor. It did not include the rural representation requirement.

He said House members said they’d rather have people with health care or other relevant expertise, and not be limited by the rural requirement.

Both bills had included a deadline for the task force to deliver a scoring method for grant proposals by March 15. However, both the House and Senate adjourned for the weekend Friday, March 13.

Redman said Friday he’d asked for his bill to go to general orders so that date could be changed.

HB 862 advanced to the floor after a committee vote on Thursday. The House Health and Welfare Committee voted in a divided voice vote to advance the bill. Some of the members who voted no suggested the state should instead return the federal money.

Rep. David Leavitt, R-Twin Falls, said at the Thursday hearing he had concerns with how the fund came to be and how much it will contribute to the federal debt. He argued D.C. lawmakers “decided to slip” the $50 billion fund into the One Big Beautiful Bill.

“We keep on borrowing from the future,” Leavitt said. “To me, that is robbing our future of their posterity, their ability to keep on going, and charging up the credit card. We’re at nearly $38 trillion in debt. And it’s frustrating going and seeing this, because it comes back to a moral commandment, a biblical commandment really, which is, thou shalt not steal.”

The Legislature is more than 60 days into the 2026 legislative session, which is targeted to end in late March, although it could go longer if lawmakers do not set a budget by then.

Lawson said the hospital association would like to see rural representation on the task force, but won’t oppose any bill if it lacks that.

“We really just need to get moving and get this money out the door,” she said.

This story first appeared on Idaho Capital Sun.