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State’s proposal for $1 billion advocated for one-time investments that will spawn long-term improvements in workforce, childbirth services and more. But it won’t offset the much bigger losses from cuts to the federal Medicaid health program. By Jeremy Olson The Minnesota Star Tribune November 10, 2025 at 12:01PM Dr. Alison Raffman, a medical resident at HCMC who spent a month doing rural ER care at Sanford Bemidji Medical Center, treats patient Sandy Helberg for a bloody nose as attending emergency physician Dr. Andrea Patten looks on in February. (Anthony Soufflé/The Minnesota Star Tribune) Other goals in the next five years include an increase in telehealth medical appointments and a 10% reduction in rural Minnesotans who return to hospitals with avoidable problems. Essentia Health employs paramedics who visit with patients and help prevent their hospital readmissions, though it has made cuts to the program. The federal government billed the funding as one-time support for five years, so Rydrych said the state focused its application on up-front investments that could pay off after the money runs dry. Technology upgrades to boost telemedicine visits were one example. The state also pledged to use the funding to increase by 15% the number of rural providers engaged in value-based care. That means the providers agree to contracts with insurers that stipulate their payments depend on the health of their patients rather than the volume of medical procedures completed. Rural providers sometimes have too few patients or procedures to qualify for value-based contracts, but Rydrych said the funding could support partnerships between providers so they could become eligible. A group of rural hospitals in Minnesota has already formed the Headwaters Network in pursuit of that goal. As proposed, the state would spread funding in the first year broadly across rural hospitals, federal health centers, tribal health programs and rural mental health services. The state would then seek competitive applications from providers for the next four years, in order to steer money toward the most-promising solutions. Jeremy Olson Reporter Jeremy Olson is a Pulitzer Prize-winning reporter covering health care for the Star Tribune. Trained in investigative and computer-assisted reporting, Olson has covered politics, social services, and family issues. See More
