A new federal policy introducing a $100,000 fee for H-1B visa applications is causing significant concern for rural schools and hospitals. These institutions, which often struggle to recruit staff, have come to rely on the H-1B program to fill critical vacancies in education and healthcare. The new fee, which the Trump administration says is designed to protect American jobs, may have the unintended consequence of jeopardizing essential services in some of the country’s most underserved communities.
The H-1B visa program allows U.S. employers to temporarily employ foreign workers in specialty occupations. While often associated with the tech industry, the program is a vital lifeline for rural communities facing shortages of qualified teachers and medical professionals. For years, schools and hospitals in these areas have used the H-1B program to bring in skilled workers from other countries, filling positions that would otherwise remain vacant. The proposed fee, however, is a significant financial barrier that many of these institutions say they cannot overcome, potentially leading to a reduction in services and a decline in the quality of education and healthcare in rural America.
Details of the New H-1B Visa Fee
The Trump administration announced the new $100,000 fee for H-1B visa applications on September 19. The administration’s stated goal is to encourage employers to hire American workers instead of what it characterizes as cheaper overseas talent. The White House has clarified that the fee will not apply to existing visa holders, and a process has been established for employers to request exemptions. However, it remains unclear how these exemptions will be applied and whether they will provide relief for the public institutions that are most in need.
The fee applies to new H-1B applications filed between September 21, 2025, and September 21, 2026. While large corporations, particularly in the tech sector, may be able to absorb this new cost, for rural school districts and hospitals with already tight budgets, the fee is a substantial and likely insurmountable obstacle. The policy has sparked a debate about the role of immigrant workers in the U.S. economy and the potential for unintended consequences in sectors that are already facing significant challenges.
Impact on Rural Education
Rural school districts across the country are facing a severe teacher shortage. One in eight public school positions are either vacant or filled by uncertified teachers. In many of these districts, the H-1B program has been a critical tool for recruitment. For example, at the K-12 Crow Creek Tribal School in South Dakota, Superintendent Rob Coverdale filled 15 vacant teaching positions with Filipino teachers who arrived on H-1B visas. Coverdale stated that these teachers are not taking jobs from Americans but are filling positions for which there were no other applicants.
For school districts like Crow Creek, the $100,000 fee is a prohibitive cost. Melissa Sadorf, the executive director of the National Rural Education Association, explained that the fee for a single hire could be equivalent to the salary and benefits of one or even two teachers, depending on the state. This places the H-1B program, and the qualified teachers it provides, out of reach for many rural budgets. The potential consequences are dire, with schools facing the possibility of having to combine classes, cut courses, or hire uncertified staff to fill the gaps.
Threats to Rural Healthcare
The healthcare sector in rural America is also heavily reliant on foreign-born professionals. The American Medical Association projects a shortage of up to 87,000 physicians in the next decade, a problem that is particularly acute in rural areas. Nearly a quarter of all physicians in the United States are international medical graduates, and these doctors are more likely to work in underserved communities. States with large rural populations, such as Iowa, West Virginia, and North Dakota, have some of the highest percentages of doctors on visas.
Healthcare administrators have warned that the new fee could have a devastating impact on their ability to provide care. Allison Roberts, vice president of human resources at Prairie Lakes Healthcare System in Watertown, South Dakota, said that if smaller, rural healthcare institutions are not exempt from the fee, they could be taken “out of the picture” when it comes to recruiting doctors. The American Hospital Association echoed these concerns, stating that the fee would likely prevent many hospitals from recruiting essential staff and could force a reduction in services.
The J-1 to H-1B Pipeline
Many foreign medical graduates begin their careers in the U.S. on J-1 visas during their residency or fellowship. The J-1 program often requires them to return to their home country for two years unless they receive a waiver. The transition from a J-1 to an H-1B visa is already a complex process, and the new fee adds another significant barrier, potentially disrupting a key pipeline of medical talent to the United States.
Legal and Industry Opposition
In response to the new policy, a coalition of more than 50 groups, including healthcare providers, religious organizations, and educators, has filed a lawsuit to stop the H-1B fee. The lawsuit argues that the fee will harm hospitals, churches, schools, and other industries that depend on the H-1B program. Medical organizations such as the American Hospital Association and the American Medical Association are also lobbying the Department of Homeland Security for exemptions for healthcare professionals, arguing that these workers fill vital gaps and do not displace American workers.
The policy does include a “national interest” provision that gives the Department of Homeland Security the authority to grant exemptions to certain workers or industries if their employment is considered beneficial to the country. However, the administration has not yet made any specific commitments to protect the healthcare or education sectors. As the legal challenges and lobbying efforts continue, the future of many essential services in rural America hangs in the balance.
