Pai Proposes to Raise USF Rural Health Care Cap by 43% Immediately, Index It for Inflation
FCC Chairman Ajit Pai proposed hiking a USF Rural Health Care cap by 43 percent, from $400 million to $571 million per year, to reflect inflation since program inception in 1997. He circulated a draft order to increase the cap for the current (2017) funding year ending June 30, index the program for inflation going forward and allow unused funds from prior years to be carried forward to future years, said a release Wednesday. It noted recent demand exceeded the budget, creating uncertainty for participants. Rural healthcare (RHC) and telco interests welcomed the announcement.
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“As the son of two doctors in rural Kansas, and having visited telemedicine projects from Alaska to Florida, I understand the critical role that broadband plays in giving patients in rural areas high-quality health care services," Pai said. The additional $171 million "will help health care providers get the connectivity they need to better serve patients throughout rural America."
The American Hospital Association and Kansas Hospital Association recently urged Pai to adjust the program for inflation back to 1997 (see 1806050027). "We greatly appreciate the action and commitment by Chairman Pai to meet the broadband connectivity needs of rural health care providers," said Tom Nickels, AHA executive vice president, Wednesday. "Innovations in health care demand connectivity."
The Schools, Health & Libraries Broadband Coalition "is extremely pleased" with the proposed increase, which is "long overdue, as the $400 M cap on the RHC program has remained set in stone for over twenty years," said Executive Director John Windhausen. "This proposal also addresses our concerns about the retroactive funding reductions for FY 2017 by ensuring that applicants in the current funding year can be fully reimbursed. This action will avoid the unfortunate 15% to 25% reductions that had been announced." It appears Pai took "our concerns to heart and is responding to the SHLB Coalition’s Emergency Waiver Petition and the request by 31 US Senators" for more funding, he said. Sen. Shelley Moore Capito, R-W.Va., tweeted thanks and said she had "heard from many WVians who rely on this important resource."
Alaska Communications is pleased Pai would increase the RHC budget, "apply the increased cap to the current funding year, provide long-term certainty by adjusting the budget annually for inflation, and allow unused funds from prior years to be carried forward to future years," said CEO Anand Vadapalli. "These are important steps forward."
It's "another important step in a much-needed process of trying to rationalize and right-size universal service program budgets for a broadband world," said NTCA Senior Vice President Mike Romano. "There is more work to be done across the programs in this regard, but today’s announcement is encouraging -- and we hope this sort of thoughtful progress will be sustained and built upon.” USTelecom appreciates the "support for rural broadband, and in particular the delivery of telemedicine in rural areas," emailed a spokeswoman.
Other commissioner offices said they were reviewing the draft or didn't comment. In backing an NPRM in December, Commissioner Mike O'Rielly said he would be "extremely reluctant" to support an RHC budget increase absent cuts to other USF programs (see Notebook at end of 1712140054). But in April, he suggested the FCC set an overall USF annual budget of $11 billion, which would give programs some headroom, given actual distributions of $8.8 billion (see 1804190045).
Blockchain technology and "smart contracts" also could help rural healthcare facilities and broadband providers take care of contract problems caused by demand exceeding the budget, blogged Mark Jamison, American Enterprise Institute visiting scholar.