[Federal Register Volume 71, Number 216 (Wednesday, November 8, 2006)]
[Notices]
[Pages 65517-65520]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-18759]


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FEDERAL COMMUNICATIONS COMMISSION

[WC Docket No. 02-60, FCC 06-144]


Rural Health Care Support Mechanism

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: In this document, the Commission establishes a pilot program 
to examine how the rural health care (RHC) funding mechanism can be 
used to enhance public and non-profit health care providers' access to 
advanced telecommunications and information services.

DATES: Effective September 29, 2006. The pilot program applications 
contain information collection requirements that have not been approved 
by OMB. The FCC will publish a document in the Federal Register 
announcing the approval by OMB.

ADDRESSES: Interested parties may submit applications, identified by 
[WC Docket number 02-60 and/or FCC Number 06-144], by any of the 
following methods:
     Federal Communications Commission's Web site: http://www.fcc.gov/cgb/ecfs/. Applicants should follow the same instructions 
provided on the Web site for submitting comments.
     Paper Submissions: Paper filings are permitted and must be 
addressed to the Commission's Secretary, Office of the Secretary, 
Federal Communications Commission, in accordance with the SUPPLEMENTARY 
INFORMATION provided herein.
     People with Disabilities: People with disabilities may 
contact the Commission to request reasonable accommodations (accessible 
format documents, sign language interpreters, CART, etc.) by e-mail at 
[email protected] or by phone (202) 418-0539 or TTY: (202) 418-0432.
    For detailed instructions for submitting applications, see the 
SUPPLEMENTARY INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: Erika Olsen, Wireline Competition 
Bureau, Telecommunications Access Policy Division at (202) 418-7400 
(voice), (202) 418-0484 (TTY), or e-mail at [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's 
document FCC 06-144, Rural Health Care Support Mechanism, Rural Health 
Care Support Mechanism Pilot Program Order, WC Docket No. 02-60, 
adopted September 26, 2006, released September 29, 2006, establishing a 
pilot program to examine how the rural health care (RHC) funding 
mechanism can be used to enhance public and non-profit health care 
providers' access to advanced telecommunications and information 
services. Applications to participate in the pilot program will be due 
30 days from the receipt of OMB approval. Applications may be filed 
using the Commission's Electronic Comment Filing System (ECFS), or by 
filing paper copies.
     Electronic Filers: Applications may be filed 
electronically using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/. Applicants should follow the instructions 
provided on the Web site for submitting comments.
     For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one copy 
of the comments for each docket or rulemaking number referenced in the 
caption. In completing the transmittal screen, applicants should 
include their full name, U.S. Postal Service mailing address, and the 
applicable docket or rulemaking number, which in this instance is WC 
Docket No. 02-60. Parties may also submit an electronic application by 
Internet e-mail. To get filing instructions for e-mail applications, 
applicants should send an e-mail to [email protected], and include the 
following words in the body of the message, ``get form .'' A sample form and directions will be sent in response.
     Paper Filers: Parties who choose to file by paper must 
file an original and four copies of each filing. If more than one 
docket or rulemaking number appears in the caption in this proceeding, 
filers must submit two additional copies of each additional docket or 
rulemaking number.
    Filings can be sent by hand or messenger delivery, by commercial 
overnight courier, or by first-class or overnight U.S. Postal Service 
mail (although the Commission continues to experience delays in 
receiving U.S. Postal Service mail). All filings must be addressed to 
the Commission's Secretary, Office of the Secretary, Federal 
Communications Commission.
     The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings to the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building.
     Commercial mail sent by overnight mail (other than U.S. 
Postal Service Express Mail and Priority Mail) must be sent to 9300 
East Hampton Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express Mail and Priority 
Mail should be addressed to 445 12th Street, SW., Washington, DC 20554.
    People with Disabilities: To request materials in accessible 
formats for people with disabilities (Braille, large print, electronic 
files, audio format), send an e-mail to [email protected] or call the 
Consumer & Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 
418-0432 (TTY).

Initial Paperwork Reduction Act of 1995 Analysis

    This document contains proposed information collection requirements 
which will be submitted to OMB. A separate notice will be published in 
the Federal Register seeking comment on these information collection 
requirements.

Synopsis

Introduction and Background

    In this Order, pursuant to section 254(h)(2)(A) of the 
Telecommunications Act of 1996, we establish a pilot

[[Page 65518]]

program to examine how the rural health care (RHC) funding mechanism 
can be used to enhance public and non-profit health care providers' 
access to advanced telecommunications and information services. 
Specifically, the pilot program will provide funding to support the 
construction of state or regional broadband networks and services 
provided over those networks. These networks will be designed to bring 
the benefits of innovative telehealth and, in particular, telemedicine 
services to those areas of the country where the need for those 
benefits is most acute.
    In addition, the pilot program will provide funding to support the 
cost of connecting the state or regional networks to Internet2, a 
dedicated nationwide backbone. Internet2 links a number of government 
research institutions, as well as academic, public, and private health 
care institutions that are repositories of medical expertise and 
information. By connecting to this dedicated national backbone, health 
care providers at the state and local levels will have the opportunity 
to benefit from advanced applications in continuing education and 
research. In addition, a ubiquitous nationwide broadband network 
dedicated to health care will enhance the health care community's 
ability to provide a rapid and coordinated response in the event of a 
national crisis.
    Under this pilot program, all public and non-profit health care 
providers may apply for funding to construct a dedicated broadband 
network that connects health care providers in a state or region. In 
particular, given the nature of the pilot program, we encourage 
multiple health care providers in a state or region to join together 
for the purpose of formulating and submitting proposals. In accordance 
with general principles of universal service, we will require 
applicants in the pilot program to include in their proposed networks 
public and non-profit health care providers that serve rural areas. As 
detailed below, this program will provide funding for up to 85 percent 
of an applicant's costs of deploying a dedicated broadband network, 
including any necessary network design studies, as well as the costs of 
advanced telecommunications and information services that will ride 
over this network. We recognize that this funding percentage exceeds 
the funding percentages under our existing RHC mechanism, but find that 
this percentage is justified by the extraordinary benefits of universal 
service designed to spur broadband deployment dedicated to telehealth, 
including telemedicine services. Moreover, we find that this percentage 
is economically reasonable because the funding is constrained by the 
program funding caps we describe below.
    The pilot program will lay the foundation for a future rulemaking 
proceeding that will explore permanent rules to enhance access to 
advanced services for public and non-profit health care providers. In 
particular, the goal of the pilot program will be to provide us with 
useful information as to the feasibility of revising the Commission's 
current RHC rules in a manner that best achieves the objectives set 
forth by Congress. If successful, increasing broadband connectivity 
among health care providers at the national, state and local levels 
would also provide vital links for disaster preparedness and emergency 
response and would likely facilitate the President's goal of 
implementing electronic medical records nationwide.
    Broadband has enabled health care providers to vastly improve 
access to quality medical services in remote areas of the country. 
Among other things, telehealth applications allow patients to access 
critically needed medical specialists in a variety of practices, 
including cardiology, pediatrics, and radiology, without leaving their 
homes or their communities. Using video feeds over broadband and real-
time patient information, intensive care doctors and nurses can monitor 
critically ill patients at multiple locations around the clock. Using 
this technology, a single medical professional is able to administer 
services to over a hundred patients, while cutting skyrocketing medical 
costs by shortening average hospital stays and reducing the need for 
additional tests and treatments. The benefits of these technologies are 
particularly apparent in underserved areas of the country that may lack 
access to the breadth of medical expertise and advanced medical 
technologies available in other areas.
    In the Telecommunications Act of 1996, Congress specifically sought 
to provide rural health care providers ``an affordable rate for the 
services necessary for the provision of telemedicine and instruction 
relating to such services.'' In 1997, we implemented this directive by 
adopting the RHC support mechanism funded by monies collected through 
the Universal Service Fund. Our RHC program provides reduced rates to 
rural health care providers for their telecommunications and Internet 
services. The primary goal of our existing rules is to ensure that 
rural health care providers pay no more than their urban counterparts 
for their telecommunications needs in the provision of health care 
services.
    In section 254(h)(2)(A), Congress directed the Commission to 
``establish competitively neutral rules to enhance, to the extent 
technically feasible and economically reasonable, access to advanced 
telecommunications and information services for * * * health care 
providers.'' Since 1997, the Commission has made several changes to the 
RHC support mechanism to make it more viable and to reflect 
technological changes. For example, the Commission has exercised its 
authority under section 254(h)(2)(A) to establish discounts and funding 
mechanisms for advanced services provided by both telecommunications 
carriers and non-telecommunications carriers. We currently have an open 
proceeding seeking comment on further modifications to the existing RHC 
support mechanism.
    Despite the modifications the Commission has made to the rural 
health care mechanism, the program continues to be greatly 
underutilized and is not fully realizing the benefits intended by the 
statute and our rules. In 1997, we authorized $400 million dollars per 
year for funding of this program. Yet, in each of the past 10 years, 
the program generally has disbursed less than 10 percent of the 
authorized funds. Although there are a number of factors that may 
explain the underutilization of this important fund, it has become 
apparent that health care providers continue to lack access to the 
broadband facilities needed to support the types of advanced telehealth 
applications, like telemedicine, that are so vital to bringing medical 
expertise and the advantages of modern health care technology to rural 
areas of the country. In addition, many of these real-time telehealth 
applications require a dedicated broadband network that is more 
reliable and secure than the public Internet. Although the Commission 
has taken a number of steps to spur deployment of the type of broadband 
facilities that would support advanced medical technologies, to date 
our rural health care funding mechanism has not adequately provided the 
type of support needed to encourage development of dedicated broadband 
networks among health care providers.
    Because of the enormous benefits of telemedicine applications that 
ride over broadband facilities, it is essential that the Commission 
take additional steps to facilitate broadband deployment to health care 
providers. Before taking further action to revise or expand the current 
RHC program, however, we believe it is prudent to engage in a trial

[[Page 65519]]

program that will provide us with a more complete and practical 
understanding of how to ensure the best use of these available funds. 
Results from such a pilot program will inform our examination of how we 
can more effectively use available funding to bring the benefits of 
broadband connectivity to health care providers and patients in those 
areas of the country most in need. Upon completion of the pilot 
program, we will issue a report detailing the results of the program 
and the status of the health care mechanism generally, and recommend 
any changes that are needed to improve the programs. In addition, we 
intend to incorporate the information we gather as part of this pilot 
program in the record of any subsequent proceeding.

Pilot Program

    The pilot program will fund a significant portion of the costs of 
deploying a dedicated broadband network that connects multiple public 
and non-profit health care providers, within a state or region, as well 
as providing the ``advanced telecommunications and information 
services'' that ride over that network. Consistent with the mandate 
provided in section 254(h)(2)(A) and general principles of universal 
service, all eligible public and non-profit health care providers may 
apply to participate in the pilot program, but applicants must include 
in their proposed networks public and non-profit health care providers 
that serve rural areas. A comprehensive network will provide the health 
care communities access to the various technologies and medical 
expertise that reside in specific hospitals, medical schools, and 
health centers within a region or state.
    The pilot program satisfies the requirements of section 
254(h)(2)(A). First, the program will be ``competitively neutral,'' 
which ``means that universal service support mechanisms and rules 
neither unfairly advantage nor disadvantage one provider over another, 
and neither unfairly favor nor disfavor one technology over another.'' 
The pilot program meets that requirement because eligible health care 
providers are free to choose any technology and provider of the 
broadband connectivity needed to provide telehealth, including 
telemedicine, services. Second, the pilot program will be ``technically 
feasible'' because the program will not require development of any new 
technology. Rather, participants will be free to utilize any currently 
available technology. Third, the program will be ``economically 
reasonable.'' In discussing economic reasonableness, the Commission has 
generally focused on the effect any new rules would have on growth in 
the rural support mechanism. To ensure the pilot program is 
economically reasonable, we will work within the confines of the 
existing RHC program funding mechanism and will structure pilot program 
funding in a manner similar to the priority system provided for the E-
rate program in the Commission's rules.
    Specifically, to ensure that there is sufficient funding for the 
existing rural health care program, we will ensure applications for RHC 
support under the existing program receive priority funding. Once we 
have determined the funding needs for the existing program, we will 
fund the pilot program in an amount that does not exceed the difference 
between the amount committed under our existing program for the current 
year and $100 million (i.e., 25 percent of the total $400 million 
annual RHC cap). Thus, if funding for RHC support under the existing 
program is $35 million in a year, $65 million will be available for the 
pilot program. By capping the combination of applications for RHC 
support under the existing program and under the pilot program at $100 
million (or 25 percent of the annual $400 million cap), we will ensure 
that the pilot program is economically reasonable. This will ensure 
that rural health care provider telecommunications needs under the 
current program are given priority and that the pilot program funding 
is capped at a reasonable level. We recognize that this prioritization 
may limit the amount of support provided to the pilot program in the 
event demand for the RHC program increases dramatically, but this 
outcome appears unlikely given our experience to date with this fund.
    Because we recognize that we will need the experience of more than 
one year to fully evaluate the results of the pilot program, the pilot 
program we establish herein is limited to two years. For purposes of 
this pilot program, we are reopening the filing window for Funding Year 
2006. Funding under this pilot program for Funding Year 2006 will be 
available until June 30, 2007. Participants that receive funds in 
Funding Year 2006 must reapply to the extent they seek additional funds 
in Funding Year 2007. Applicants not selected in Funding Year 2006 may 
apply for funds during our normal filing window for Funding Year 2007.
    The funding provided under this pilot program may be used to fund 
up to 85% of the costs incurred by the applicants to deploy a state or 
regional dedicated broadband health care network, and to connect that 
network to Internet2. Selected applicants must use these funds for the 
purposes specified in the application award. Authorized purposes will 
include the costs of deploying transmission facilities and advanced 
telecommunications and information services, including associated non-
recurring and recurring costs. We find that section 254(h)(2)(A), which 
requires the Commission ``to enhance * * * access to advanced 
telecommunications and information services,'' authorizes support for 
construction of facilities for the purposes of this pilot program. This 
is consistent with the Commission's conclusion in the May 8th Universal 
Service Order, FCC 98-85, released May 8, 1998, that we have authority 
to implement a program of universal service support for infrastructure 
development as a method to enhance access to advanced services under 
section 254(h)(2)(A). Because many health care providers would be 
unable to access certain telehealth services without deployment of new 
broadband facilities, the pilot program will support construction of 
those facilities.
    For purposes of this pilot program, we will permit funding to be 
used to conduct initial network design studies. These studies will 
enhance access to advanced telecommunications and information services 
by enabling applicants to determine how best to deploy an efficient 
network that includes multiple locations and various technologies. We 
recognize that funding initial network design studies in the pilot 
program goes beyond the services normally eligible for support in the 
RHC program. Consistent with our authority in section 252(h)(2)(A), we 
conclude that funding these studies is in the public interest for the 
purposes of this pilot program because it will enable program 
participants to explore more efficient, effective means of delivering 
telemedicine in rural areas. In light of the historical trend of the 
RHC program to operate at 10% or less of the total amount authorized, 
as well as the funding cap described earlier, we find that funding 
network design studies for pilot program participants will be 
economically reasonable. We find that these justifications apply 
equally to supporting infrastructure deployment, which is also not 
covered under the existing program.
    We will select a limited number of participants from applications 
that meet the criteria outlined below. We expect each applicant to 
present a strategy for aggregating the specific needs of health care 
providers, including providers that serve rural areas, within a state 
or

[[Page 65520]]

region, and leveraging existing technology to adopt the most efficient 
and cost effective means of connecting those providers. Applicants 
should indicate in their application how they plan to fully utilize a 
newly created dedicated broadband network to provide health care 
services. We anticipate that successful applicants will be able to 
demonstrate that they have a viable strategic plan for aggregating 
usage among health care providers within their state or region. In 
choosing participants for the program, we will consider whether the 
applicant has a successful track record in developing, coordinating, 
and implementing a successful telehealth/telemedicine program within 
their state or region. In addition, because the purpose of this program 
is to encourage health care providers to aggregate their connection 
needs to form a comprehensive statewide or regional dedicated health 
care network, we will also consider the number of health care providers 
that would be included in the proposed network. In particular, we will 
give considerable weight to applications that propose to connect the 
rural health care providers in a given state or region. A proposal that 
connects only a de minimis number of rural health care providers will 
not be accepted.
    To be eligible for participation in the pilot program, interested 
parties should submit applications that:
    (1) Identify the organization that will be legally and financially 
responsible for the conduct of activities supported by the fund;
    (2) Identify the goals and objectives of the proposed network;
    (3) Estimate the network's total costs for each year;
    (4) Describe how for-profit network participants will pay their 
fair share of the network costs;
    (5) Identify the source of financial support and anticipated 
revenues that will pay for costs not covered by the fund;
    (6) List the health care facilities that will be included in the 
network;
    (7) Provide the address, zip code, Rural Urban Commuting Area 
(RUCA) code and phone number for each health care facility 
participating in the network;
    (8) Indicate previous experience in developing and managing 
telemedicine programs;
    (9) Provide a project management plan outlining the project's 
leadership and management structure, as well as its work plan, 
schedule, and budget.
    (10) Indicate how the telemedicine program will be coordinated 
throughout the state or region; and
    (11) Indicate to what extent the network can be self-sustaining 
once established.
    Applicants will be required to comply with the existing competitive 
bidding requirements, certification requirements, and other measures 
intended to ensure funds are used for their intended purpose. We 
recognize that we may need to waive additional rules in order to 
implement this pilot program, and we request that applicants identify 
in their application any rules that they would like us to waive for 
purposes of this pilot program.
    Applications to participate in the pilot program will be due 30 
days from the receipt of OMB approval.
    Instructions for Filing. Applications should reference WC Docket 
No. 02-60 only, and may be filed using (1) the Commission's Electronic 
Comment Filing System (ECFS), or (2) by filing paper copies.
     Electronic Filers: Applications may be filed 
electronically using the Internet by accessing the ECFS at http://www.fcc.gov/cgb/ecfs/. Applicants should follow the same instructions 
provided on the Web site for submitting comments. In completing the 
transmittal screen, ECFS filers should include their full name, U.S. 
Postal Service mailing address, and the applicable docket or rulemaking 
number. To get filing instructions for e-mail applications, commenters 
should send an e-mail to [email protected] and should include the following 
words in the body of the message, ``get form .'' A 
sample form and directions will be sent in reply.
     Paper Filers: Parties who choose to file by paper must 
file an original and four copies of each application. Applications can 
be sent by hand or messenger delivery, by commercial overnight courier, 
or by first-class or overnight U.S. Postal Service mail (although we 
continue to experience delays in receiving U.S. Postal Service mail). 
All filings must be addressed to the Commission's Secretary, Office of 
the Secretary, Federal Communications Commission.
    The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building. Commercial overnight mail 
(other than U.S. Postal Service Express Mail and Priority Mail) must be 
sent to 9300 East Hampton Drive, Capitol Heights, MD 20743. U.S. Postal 
Service first-class, Express, and Priority mail should be addressed to 
445 12th Street, SW., Washington DC 20554.
    Applicants must also send a courtesy copy of their application to 
each of the following individuals: (1) Jeremy Marcus, (202) 418-0059, 
[email protected]; (2) Thomas Buckley, (202) 418-0725, 
[email protected]; and (3) Erika Olsen, (202) 418-2868, 
[email protected]. Each is located in the Telecommunications Access 
Policy Division, Wireline Competition Bureau, Federal Communications 
Commission, 445 12th Street, SW., Washington, DC 20554.

Ordering Clause

    Pursuant to the authority contained in sections 1, 4(i), 4(j), 10, 
201-205, 214, 254, and 403 of the Communications Act of 1934, as 
amended, 47 U.S.C. 151, 154(i), 154(j), 201-205, 214, 254, and 403, 
this Order is adopted, and shall become effective September 29, 2006, 
pursuant to 47 U.S.C. 408, except that the information collections 
contained in the Order will become effective following OMB approval. 
Applications to participate in the pilot program shall be filed 30 days 
from the receipt of OMB approval. The Commission will issue a public 
notice announcing the date upon which the information collection 
requirements set forth in this Order shall become effective following 
receipt of such approval.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. E6-18759 Filed 11-7-06; 8:45 am]
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