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Baxter Health will receive nearly $19.8 million through Arkansas’ new rural health grant program, more than any other single organization in the state’s first round of awards.
Gov. Sarah Huckabee Sanders announced $149.3 million in Rural Health Transformation Program grants on Aug. 27 at the state Capitol. Fifty projects were funded. Baxter Health won money under both of the initiatives the state paid out.
Together, the hospital’s two grants account for about 13% of everything Arkansas awarded in this round.
The larger of the two awards, a full $12 million, goes to the Baxter Health Rural Access Network. The state lists 11 counties in the project’s service area: Baxter, Fulton, Marion, Boone, Izard, Stone, Searcy, Van Buren, Madison, Carroll and Newton.
Baxter Health calls the project PACT and describes it as a regional model for sharing specialty care across north-central Arkansas. The hospital says it will work with Boston Mountain Rural Health Center and Izard Regional Hospital to bring specialists closer to rural patients. Boston Mountain is a federally qualified health center based in Marshall with clinics in Mountain Home, Yellville and about a dozen other towns.
Neither partner received a grant of its own in this round. Whatever money reaches them will come through Baxter Health.
The second award, roughly $7.7 million, funds THRIVE at Home across Baxter, Fulton, Marion, Boone, Izard and Stone counties. That project covers emergency response equipment, community paramedicine, hospital-at-home services, remote patient monitoring, telehealth and chronic care support.
Baxter Health notes that THRIVE at Home was only partially funded. The hospital says it will work with state officials to narrow the scope and timing, and that some pieces of its original proposal may be pushed into future funding requests.
“This is an extraordinary opportunity for Baxter Health and, more importantly, for the rural communities we serve,” Baxter Health President and CEO Ron Peterson said in a statement. “People who choose to live in rural America deserve access to exceptional healthcare close to home.”
The Observer reported in May that THRIVE at Home was the first of four applications Baxter Health planned to submit to the program. Two of those four have now been decided. The other two, called RISE and HEART, are still under review by the state.
Sanders said the awards target problems the state already knows how to solve. Her office described the first round as reaching all 75 counties, with money going to hospitals, ambulance services, health centers, universities and nonprofits.
The program traces back to the federal tax and spending law passed in 2025. It sets aside $50 billion nationally over five years. Arkansas received about $209 million for this budget year and expects roughly $1 billion over the full five years.
That same law is why the money matters so much here. Federal Medicaid spending in rural areas is projected to fall by $137 billion over the next decade, according to estimates from KFF, a nonprofit health policy research group. The grant program replaces only a fraction of that.
The pressure is closer than the national numbers suggest. Arkansas’ hybrid Medicaid expansion, which covers more than 200,000 people, has not been renewed by the federal government. The state has asked for a two-year extension while it works out a replacement.
Baxter Health is unusually exposed to those decisions. Peterson told a Mountain Home Area Chamber of Commerce audience in early 2025 that government payers cover roughly 83% of the hospital’s patients and that Arkansas has the lowest Medicare reimbursement rates in the country. He also said nearly 60% of the area population lives with a chronic condition.
The awards are also not the only rural health money coming into Baxter County. A group operating as the North Arkansas Rural Health Consortium received $1 million to build a regional hub around Vitality Plus Ambulatory Surgery, with telehealth, presurgical testing and mobile specialty care.
Two other funded projects list Baxter County in their service areas. ARcare received about $2.6 million for remote monitoring and telehealth micro-clinics across a dozen counties. St. Bernards Development Foundation received $5 million for a telehealth and remote monitoring network spanning eight counties, including this one.
Maternal care is getting attention too. The University of Arkansas for Medical Sciences won nearly $3 million for Arkansas Pregnancy Care Connect, which pairs mobile teams in 24 high-need counties with a round-the-clock nurse line. Baxter, Marion, Boone, Fulton, Izard, Searcy, Sharp and Stone counties are all on that list.
Eight of the 50 funded projects name Baxter County somewhere in their service area. Those grants total about $33.3 million, though most of that money is spread across many counties rather than spent here.
There is one detail worth watching in the Baxter Health award. The hospital’s announcement says PACT will convert five community clinics to Rural Health Clinic status. The state’s own description of the same project says it will expand services in 10 clinics and serve 2,400 rural residents by year five.
State officials say the numbers are not locked in yet. The governor’s office noted that project details come from each applicant’s own proposal, and that nothing is final until the Department of Finance and Administration signs an agreement with each recipient.
Peterson framed the announcement as a starting line rather than a finish. “The challenges of rural healthcare cannot be solved by one hospital or one community working alone,” he said.
Baxter Health will now work with the state to set implementation plans, timelines and responsibilities before either project begins.
