Healthcare Resiliency Program: Service Line Expansion and Co-Location Program

The Tennessee Department of Health is administering the Healthcare Resiliency Program: Service Line Expansion and Co-Location initiative under its Division of Strategic Initiatives. This program is designed to address persistent gaps in access to comprehensive healthcare services across rural communities in Tennessee. The agency recognizes that fragmented care delivery systems in these regions contribute to poor health outcomes and inefficiencies. Through this funding opportunity, the Department seeks to strengthen healthcare infrastructure by expanding service capacity and fostering collaboration among providers within existing healthcare settings. The core purpose of the program is to enable rural hospitals, Critical Access Hospitals, and co-located clinics to broaden their service offerings and integrate multiple types of care. The initiative promotes a model that combines primary care, specialty services, behavioral health, and social health supports into a cohesive system. By doing so, it aims to improve continuity of care, reduce service gaps, and enhance patient outcomes. The program emphasizes the Healthcare Resiliency Program model, which integrates multiple service lines within a sustainable operational framework tailored to rural healthcare environments. Funding under this opportunity supports a wide range of allowable activities focused on expanding and strengthening healthcare service delivery. These include co-location of services such as integrating behavioral health into primary care settings, facility renovations within existing spaces, acquisition of clinical equipment, and implementation of telemedicine solutions. Additional supported activities include workforce development initiatives such as staffing supports tied to rural service commitments, simulation-based clinical training, and development of clinical workflows and protocols. All funded projects must demonstrate how their service offerings contribute to a financially sustainable portfolio that balances revenue-generating services with essential and community-focused care. The program places specific limitations on the use of funds. All expenditures must be reasonable, necessary, and directly tied to project goals while complying with applicable federal and state regulations. Administrative and indirect costs are capped at a combined maximum of 10 percent of the total award per budget period, regardless of whether a negotiated indirect cost rate or the de minimis rate is used. Applicants are encouraged to minimize these costs to maximize the impact of direct service delivery investments. Eligible applicants include rural hospitals, Critical Access Hospitals, and co-located clinics operating within Tennessee. The program prioritizes projects that expand key service lines such as perinatal care, behavioral health, emergency services, primary care, pediatrics, chronic care coordination, and specialty or diagnostic services. Applicants must demonstrate a strategic approach that aligns service expansion with long-term sustainability, including balancing high-margin services with mission-critical and loss-leader services. The application process requires submission of a comprehensive application package through the Tennessee Department of Health procurement portal. Required components include a detailed application form, competitive requirements documentation, a logic model, letters of commitment from partner organizations, personnel biosketches, and a detailed line-item budget. Applicants must also submit supporting administrative documents such as a W-9 and supplier registration forms. The Department provides a structured schedule that includes a pre-response teleconference, a deadline for written questions, and a firm submission deadline. Late submissions are not accepted under any circumstances. Applications are evaluated by a committee using defined criteria including community need, project plan quality, evaluation strategy, sustainability, and budget justification. The total available funding for the program is $95,040,187, and multiple awards are expected depending on application volume and quality. The performance period is anticipated to begin on September 1, 2026 and extend for approximately 50 months, concluding on October 31, 2030. Applicants are notified of evaluation outcomes prior to contract execution, and successful applicants enter into one of several standard state grant agreements depending on organizational type.

Align proposal with evaluation criteria emphasizing community need and sustainability; minimize indirect costs; demonstrate balanced service portfolio