USDA announces $500 million grant initiative for rural health care expansion, support

The U.S. Department of Agriculture (USDA) will send up to $500 million for rural Minnesota health care providers, facilities and clinics to expand operations.

Secretary Tom Vilsack and Minnesota U.S. Senators Amy Klobuchar and Tina Smith unveiled the initiative Thursday in front of River’s Edge Hospital and Clinic in St. Peter after touring the hospital accompanied by city and county officials, hospital administrators and staff. River’s Edge has spent millions of dollars to upgrade the campus through a USDA program.

“We’re excited about this $500 million dollar opportunity to improve and expand on rural health care. And we're not going to stop there,” Vilsack said.

One part of the grant program is designed to address costs hospitals and clinics incurred during the COVID-19 pandemic, such as paying for telemedicine.

About $350 million of the half a billion dollars will be available for facilities like River’s Edge immediately. Hospital officials may spend the funds on medical supplies, equipment, replacing lost revenue, expanding telehealth capacity and more.

Sen. Smith said that since 2010, about 138 rural hospitals across the country have closed their doors. More than a dozen shut down in 2020.

“This is creating a significant crisis for access to care, as well as the deep concerns about what happens to rural communities when their hospitals go away,” Smith said. “This USDA community facilities program, rescue plan and grants that Secretary Vilsack just announced are another crucial piece of the puzzle for what we can do to support rural hospitals to make improvements and to build capacity, which is exactly what we need.”

The USDA has set aside $150 million for additional grants to expand electronic health data systems, home care and health transportation.

“We’re still getting through this pandemic, but we also know that we have to plan for the health care needs of the future, and rural is going to be a big part of that,” Klobuchar said.

The River’s Edge Hospital expansion and renovation project took almost two years and was completed in July 2020. The $33.8 million project was partially funded through the USDA Community Facilities Direct Loan and Grant Program.

The health care facility added more than 31,000 square feet to its campus including 25 private patient rooms, inpatient rehabilitation services, emergency and urgent care departments. River’s Edge now has new ambulance and emergency medical personnel space. The hospital was able to renovate 35,000 square feet of existing space for surgical and rehabilitation services, a pharmacy, laboratory and a cafe.

“We provide access for local residents and the surrounding communities to high-quality care,” said Paula Meskan, the southern Minnesota hospital’s chief executive officer. “[The USDA] played a great part in the expansion and providing us with funding to be able to do what we’ve done with River’s Edge.”