Regional hubs aren’t bureaucracy — they’re how rural health scales

Why the Centers for Medicare & Medicaid Services is encouraging hub-based models and how states should think about them

In brief

• Regional hubs aren’t red tape — they’re how states scale rural health without breaking central agency capacity.
• Hubs shift states from managing dozens of providers to governing outcomes across regions.
• Without regional hubs, rural health transformation stalls at pilots instead of scaling statewide.

Regional hubs can sound like another layer of administration. For some state leaders, the phrase raises concerns about governance complexity, new intermediaries or dilution of local control. In the context of the Rural Health Transformation Program (RHTP), that framing misses the point.

The Centers for Medicare & Medicaid Services (CMS) allows — and in many cases expects — states to use regional hubs or lead organizations as a way to coordinate rural transformation at scale. These hubs are not meant to centralize care delivery. They are designed to connect fragmented systems, align partners and tailor solutions to local needs without requiring states to manage every relationship directly.

Hubs enable scale without sacrificing local relevance

Rural health challenges vary dramatically across regions. Workforce shortages, access gaps and infrastructure constraints rarely look the same from one county to the next.

Regional hubs allow states to:

• Set consistent statewide goals
• Delegate localized execution
• Reduce duplication across providers
• Support shared services such as care coordination, technology and analytics

Rather than forcing every rural provider to operate independently, hubs create a structure for shared capacity while preserving local delivery.

A broader ecosystem of implementers becomes possible

Only states can apply directly to the CMS for RHTP funding. But states are explicitly permitted to subgrant funds to a wide range of implementing partners, including:

• Community-based organizations
• Disability service providers
• Public health agencies
• Academic institutions
• Nonprofits

Regional hubs provide a practical way to manage this ecosystem. They help states:

• Vet and support subrecipients
• Align partners to common goals
• Monitor progress across multiple initiatives
• Reduce the administrative burden on state agencies

Without hubs, states often find themselves managing dozens — or hundreds — of bilateral relationships directly.

Hubs support ‘rightsizing’ rural care delivery

One of the RHTP’s approved uses of funds is helping rural communities rightsize their care delivery systems — identifying the appropriate mix of preventive, ambulatory, emergency, inpatient, outpatient and post-acute services.

This is inherently a regional exercise.

Hubs can:

• Analyze service patterns across communities
• Coordinate referrals and access pathways
• Support transitions between care settings
• Align investments with regional demand

Rather than reinforcing silos, hubs make it easier to design systems that work across boundaries.

What this means for states

Regional hubs are not about relinquishing control. They are about governing smarter.

States that use hubs effectively:

• Retain strategic oversight and accountability
• Delegate operational coordination to trusted local entities
• Gain visibility into regional performance
• Reduce strain on state staff capacity

States that avoid hub models often struggle to scale initiatives beyond pilot projects or sustain momentum across multiple regions.

What to do next if you’re considering hub models

For state agencies considering or refining hub models:

1. Define the problem the hub is meant to solve (coordination, scale, subrecipient support, access).
2. Clarify authority and accountability up front — hubs coordinate, states govern.
3. Align funding, reporting and performance expectations from day one.

When designed intentionally, regional hubs are not another layer of complexity. They are the connective tissue that allows rural health transformation to move from policy to practice.

The views reflected in this article are the views of the author and do not necessarily reflect the views of Ernst & Young LLP or other members of the global EY organization.