After sifting through nearly 1,800 funding proposals, state officials have narrowed down the potential projects to a list of just over 400 that will undergo further consideration this month before final funding decisions are made.
The Rural Health Transformation Program was created last year through a budget reconciliation bill, dubbed the One Big Beautiful Bill. The bill, crafted and passed by congressional Republicans, including members of Alaska's delegation, put in place new work requirements for Medicaid, which serves one in three Alaskans. Those requirements are projected to cause thousands of Alaskans to lose access to health insurance.
The $50 billion Rural Health Transformation fund was created in part to make up for cuts to federal Medicaid spending. It was written in such a way that disproportionately benefits Alaska, in part to secure the support of Alaska's U.S. Sens. Lisa Murkowski and Dan Sullivan.
The $272 million at Alaska's disposal is the second-largest sum in the nation, after the one allocated to Texas, and by far the largest sum per capita. Similar awards are expected annually during the program's five-year duration. But there is a key restriction: Any money not spent within a few months will be forfeited back to the federal government.
That has spurred a mad dash by Alaska healthcare providers to come up with creative ways to spend the funds, with ideas ranging from the mundane to the far-fetched.
"You name a program 'transformation,' but the way that the feds designed it is almost directing us to AI," said Anchorage Democratic Rep. Genevieve Mina, one of two state lawmakers on the advisory council for Alaska's program. "There's so many ways that we could transform healthcare with this tranche of money, but we can't use it for the actual infrastructure, etc., so I think this year-one exercise is everybody trying to figure out what they can and can't do."
The program comes with strict rules, including prohibitions on using the funding to build new healthcare facilities or supplant Medicaid services.
Mina and other members of the advisory council broadly agree that the funding Alaska is set to disburse through the five-year duration of the program has the potential to improve aspects of Alaskans' health through innovative ideas.
But some observers say it will do little to address the structural barriers to healthcare in Alaska and across the country, namely a fractured insurance system that leaves many without the means to pay for care.
"We have people who don't have coverage and we have people who can't access care, and we have hospitals that could potentially close," said Amber Lee, state director for Protect Our Care Alaska, an organization that advocates for affordable health insurance.
The funding Alaska received is "good money, but it doesn't fix the problem of the cuts" to public insurance programs, Lee said.
"Can transformation be incremental?" asked Nils Andreassen, director of the Alaska Municipal League, who also serves on the advisory committee. "There will be transformation," he added, but "could we go further? Maybe."
"This approach does no harm, and tries to do as much good as it can," said Andreassen.
Among the projects that advanced for further consideration are one from the Tanana Chiefs Conference to deliver vaccines and pharmaceuticals to Interior villages using drones; several proposals to disseminate "wearable health monitoring devices" to rural residents to track their blood pressure and other biometric data points; and a plan from the Wrangell Public School District to purchase virtual reality headsets as part of a new healthcare professional career track.
Applicants who advanced through the initial screening process have until June 22 to submit additional information to the state on how they plan to use the money if they receive it. Final awards will be determined next month.
Before making final funding decisions, the state is expected to rank the projects based on parameters that include expected outcomes, rural impact, transformation potential, strength of partnerships and coordination, and sustainability.
The summary of letters of interest published by the Department of Health provides insight not just on the awards accepted but also on the companies outside Alaska seeking a slice of the state's new funding pie.
More than 300 proposals were submitted by companies headquartered outside the state, including from technology giants like Microsoft. The state advanced just 19 proposals submitted by Outside companies, including eight from Washington-based Providence Health & Services, a nonprofit that operates several hospitals throughout Alaska.
Among the other advanced proposals is one from a Massachusetts -based startup looking to partner with the Anchorage School District to launch a school-based behavioral telehealth initiative. A New York -based company has offered to launch an app providing peer mentoring for Alaska youth ages 13-26.
The funding requests highlight a reality that Alaska -based healthcare providers are contending with. Much of the money coming to the state through the program, even if awarded to Alaska -based recipients, will eventually go to purchase technology and software developed in the Lower 48. For Alaskans who see this program as a potential boon for the state's healthcare industry — the largest private-sector employer in the state — the funding may prove to be a mixed bag.
Alaskans "are wary, naturally, of national-level or Outside interest," said Andreassen. Ultimately, he said, "we're trying to get investment into Alaska, but we're also trying to change the Alaska system, and we could benefit from what others are doing Outside."
The project award categories were divided by amount into those under $50,000, those under $250,000, those under $1 million, those under $5 million, and those over $5 million. The state advanced 28 project requests for over $5 million — potentially amounting to more than half the funding available through the program.
Among the requests for over $5 million is one from Ryan Air to purchase new aircraft to deliver medical supplies to rural Alaska. The aircraft "take off like a helicopter and fly as an airplane," allowing them to land on very short runways, Ryan Air wrote in the application.
The letter of interest submission process "was intentionally designed as a broad intake process to help the department understand the range of ideas, opportunities, and transformation concepts emerging across Alaska," Department of Health spokesperson Mirna Estrada wrote in an email responding to questions.
"The goal was not simply to identify the strongest individual proposals, but to advance a diverse and balanced portfolio that reflects Alaska's health care landscape and the commitments outlined in the State's approved RHTP project narrative," wrote Estrada.
Among the nearly 1,300 proposals that have already been rejected or deferred by the state is one from a California -based company that advocates for sex workers, called the Erotic Service Providers Legal, Education, and Research Project. It proposed opening an indoor dog park in Anchorage, complete with a coffee and ice cream bar. The proposal did not advance.
©2026 Anchorage Daily News, Distributed by Tribune Content Agency, LLC.
