Rural Health Transformation Program FAQs: Compliance & Reporting

The Rural Health Transformation Program (RHTP) allows states to invest in and implement initiatives aimed at improving rural healthcare delivery and outcomes. States are responsible for carrying out their rural health plans in alignment with program‑specific and federal guidance.

This article is the final piece in a series of four articles that will cover answers to key questions surrounding the RHTP. This final article covers questions related to RHTP reporting, compliance, and oversight. The first three articles in this series are below for more RHTP insights:

1. What are the statutes and regulations that apply to the RHTP?

Awards under the RHTP are subject to a combination of governmentwide federal grant requirements, HHS‑specific policies, and program‑specific guidance. Key applicable authorities include:

2 CFR 2001 (Uniform Guidance) – States are responsible for carrying out their rural health plans in alignment with program‑specific and federal guidance.
2 CFR 3002 – Supplement to 2 CFR 200 DHS-specific requirement.
2 CFR 1703 – This covers the Federal Funding Accountability and Transparency Act (FFATA).
2 CFR 1804 – This relates to suspension and debarment.
HHS Grants Policy Statement5 – This provides guidance on how the HHS applies federal grant requirements in practice.
CMS RHTP Program Guidance6 and Award-Specific Terms7 – This establishes program-specific requirements.
Governing state statutes and regulations.

2. What are the reporting requirements under the RHTP?

The Notice of Funding Opportunity (NOFO)8 and award terms establish required reporting for states, including progress and financial reporting. The specific reporting periods and due dates are outlined in each state’s cooperative agreement.

While subrecipients do not submit reports to CMS, they can expect to have reporting requirements under their subrecipient agreements to support state reporting. FFATA reporting may apply to both states and subrecipients for qualifying subawards. The table below outlines the types of reporting, their periods, and what they contain.

Reporting Type	Reporting Frequency	Due Date	Details
Progress	Three quarterly progress reports One annual progress report	Due 30 days after the period ends – for both quarterly and annual reports See your award terms for specific due dates	A summary of activities completed, progress toward program goals, and any issues or planned adjustments
Financial	Annual FFR (SF-424)	Due 90 days after the end of the budget period	This summarizes cumulative expenditures and remaining balances for the budget period.
FFATA	Subaward reporting Executive compensation	Due to the Federal Subaward Reporting System (FSRS). This should be done within 30 days of subaward.	This is required if the subaward is greater than $30,000. It is intended to support accountability and transparency.

3. The award has a $40,000 FFATA reporting threshold, but the CFR is $30,000. Which FFATA threshold should we follow?

Under 2 CFR Part 170, the FFATA subaward reporting threshold is $30,000. RHTP guidance references a $40,000 threshold; however, available documentation does not indicate an exception that supersedes the federal standard. Until CMS or OMB issue formal clarifications, then the most conservative course of action is to comply with the more stringent requirement, which is the $30,000 threshold set by the 2 CFR.

4. What type of oversight should states anticipate from CMS?

States should anticipate that CMS will provide ongoing oversight of the RHTP program using a risk-based approach. Oversight by CMS is intended to monitor compliance, program performance, and use of funds. Key elements of this oversight include:

Reporting – States are required to report to CMS consistent with question two above.
Desk Reviews and Site Visits – CMS may conduct virtual or in‑person visits to review financial management, internal controls, and program implementation. These activities can occur at any point during the award period, and to any state regardless of risk level.
Continuous Communication and Technical Assistance – This may include corrective actions or additional award conditions when non‑compliance is identified.

5. What responsibilities do states have for monitoring subrecipients?

As pass‑through entities (PTEs) under the RHTP, states are responsible for monitoring subrecipients to support compliance with federal requirements and award terms. These monitoring requirements can be found in 2 CFR Part 200, Subpart D.9 At a high level, these requirements include:

Documenting the subrecipient vs. contractor determination.
Developing subrecipient agreements that incorporate applicable federal and program requirements.
Conducting risk‑based reviews of subrecipient programmatic and financial performance, compliance with requirements, and follow-up on audit findings or compliance issues specific to the federal program.
Addressing non‑compliance as identified.

6. What are the special conditions and limitations for awards for for-profit organizations?

Awards to for‑profit organizations under HHS programs, including RHTP, are subject to additional oversight under 2 CFR 300.218.10 These provisions include:

Prohibition on profit – For‑profit organizations may not earn profit on awards, so payments are limited to allowable direct and indirect costs.
Restrictions on program income – Program income is generally not allowed to be used to further project or program objects, except under specific circumstances.
Enhanced audit requirements – For‑profit organizations are subject to specific audit expectations, which may include a financial audit conducted under Generally Accepted Government Auditing Standards or an audit under 2 CFR 200 Subpart F.11

7. How long must RHTP records be retained, and what types of records are most critical?

In accordance with 2 CFR §200.334,12 the NOFO, and RHTP FAQs, recipients and subrecipients must retain all RHTP‑related records for at least three years from the date of submission of the final financial or performance report (whichever is later). Longer retention is required if audits, monitoring reviews, investigations, claims, or litigation are ongoing or if CMS requires an extension. Records must be sufficient to demonstrate compliance with the NOFO, cooperative agreement terms, and the approved RHTP plan, and must be secure, complete, and readily accessible for CMS review. Critical records include:

Financial records (general ledger, source documentation, drawdowns, budgets, and indirect cost documentation).
Programmatic and performance records (documentation supporting approved initiatives, milestones, metrics, and reported outcomes).
Subrecipient and contractor records (agreements, procurement files, monitoring documentation, and reports).
Personnel and payroll records (time and effort documentation, payroll, and cost allocation support).
Audit and compliance records (audit reports, CMS correspondence, corrective action documentation, and relevant policies).

8. What are common findings from CMS desk reviews or site visits, and how can recipients and subrecipients prepare?

Federal agencies such as HHS and CMS conduct desk reviews and site visits to understand how recipients are carrying out their grant responsibilities. These reviews focus on alignment with 2 CFR 200 (Uniform Guidance), the terms and conditions of each award, and the overall stewardship of federal funds. The common themes13 identified during reviews include:

Financial management and internal control gaps. These may include written policies that are outdated or incomplete, limited segregation of duties, or drawdown practices that do not reflect actual expenditures.
Unsupported or unallowable costs. Missing source documentation or limited time‑and‑effort support for payroll charges often leads to questions about cost allowability.
Budget and award compliance concerns. Unapproved budget revisions, changes in scope, or changes in key personnel without prior approval are frequently noted.
Procurement‑related issues. Reviews often highlight limited documentation of competition, missing federal contract clauses, or inconsistent procurement practices.

Common Challenges or Difficulties

Subrecipient Monitoring	Reporting	Unresolved Audit Findings
Some recipients lack: Documented risk assessments Ongoing monitoring activities Evidence that federal requirements were communicated to subrecipients	Late, inaccurate, or inconsistent financial and programmatic reporting	Recipients may have: Repeated audit findings A limited record of following through on corrective action

Ways recipients and subrecipients can prepare:

Maintain clear, organized documentation. Records should demonstrate how expenditures support program objectives and reflect the approved budget.
Keep written policies updated. Policies should align with 2 CFR Part 200, and teams should be familiar with how they apply them in daily practices.
Reconcile financial activity regularly. This includes monitoring drawdowns, general ledger activity, and all required reports.
Prepare staff for conversations during reviews. Program and finance personnel should be ready to explain processes, controls, and program progress.
Address known challenges early. Document steps taken to resolve issues and demonstrate progress toward corrective actions.
Engage collaboratively during reviews. Desk reviews and site visits are intended to offer insight and technical support in addition to compliance feedback.

Disclaimer: This content reflects interpretation of CMS, HHS, and applicable federal guidance (including 2 CFR 200 and 2 CFR 300) from Forvis Mazars. Additional state‑specific or organization‑specific guidance and requirements may also apply.

How Forvis Mazars Can Help

Navigating the compliance, reporting, and oversight requirements of the RHTP requires careful coordination across multiple grants management functions: programmatic, financial, reporting, etc. Our team at Forvis Mazars brings experience in interpreting federal and program-specific requirements and translating that into actionable procedures to support compliance through the life cycle of an award.

With teams dedicated to grants management services and healthcare consulting, Forvis Mazars is positioned to support entities across the life cycle of the RHTP—from upfront planning and program design to compliance, monitoring, and closeout. Whether supporting states as they carry out oversight activities or helping subrecipients understand and meet applicable requirements, Forvis Mazars can help.

If you have questions or would like to discuss the rural health transformation plan and how it could apply to your organization, please reach out to a professional at Forvis Mazars.

Learn more about how healthcare organizations can navigate RHTP opportunities:

The information set forth contains the analysis and conclusions of the author(s) based upon his/her/their research and analysis of industry information and legal authorities. Such analysis and conclusions should not be deemed opinions or conclusions by Forvis Mazars or the author(s) as to any individual situation as situations are fact-specific. The reader should perform their own analysis and form their own conclusions regarding any specific situation. Further, the author(s)’ conclusions may be revised without notice with or without changes in industry information and legal authorities.

1“Code of Federal Regulations: 2 CFR 200,” ecfr.gov, January 29, 2026.
2“Code of Federal Regulations: 2 CFR 300,” ecfr.gov, January 29, 2026.
3“Code of Federal Regulations: 2 CFR 170,” ecfr.gov, January 29, 2026.
4“Code of Federal Regulations: 2 CFR 180,” ecfr.gov, January 29, 2026.
5“HHS Grants Policy Statement,” hhs.gov, October 1, 2025.
6“Rural Health Transformation (RHT) Program,” cms.gov, January 2026.
7“CMS Notice of Award,” health.wyo.gov, December 29, 2025.
8“CMS-RHT-26-001: Rural Health Transformation Program – Notice of Funding Opportunity,” grants.gov, January 2026.
9“Code of Federal Regulations: 2 CFR 200 Subpart D,” ecfr.gov, January 29, 2026.
10“Code of Federal Regulations: 2 CFR 300.218,” ecfr.gov, January 29, 2026.
11“Code of Federal Regulations: 2 CFR 200 Subpart F,” ecfr.gov, January 29, 2026.
12“Code of Federal Regulations: 2 CFR 200.334,” ecfr.gov, January 29, 2026.
1“HHS-OIG Oversight Activities: Desk Reviews and Quality Control Review” oig.hhs.gov.

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