Proposed Rule2023-04990
Promoting Telehealth in Rural America
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
March 23, 2023
Issuing agencies
Federal Communications Commission
Abstract
In this document, the Federal Communications Commission (Commission) continues its efforts to improve the Rural Health Care (RHC) Program. The RHC Program seeks to support rural health care providers with the costs of broadband and other communications services for patients in rural areas that may have limited resources, fewer doctors, and higher rates than urban areas.
Full Text
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[Federal Register Volume 88, Number 56 (Thursday, March 23, 2023)]
[Proposed Rules]
[Pages 17495-17511]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-04990]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 54
[WC Docket No. 17-310; FCC No. 23-6; FR ID 129966]
Promoting Telehealth in Rural America
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In this document, the Federal Communications Commission
(Commission) continues its efforts to improve the Rural Health Care
(RHC) Program. The RHC Program seeks to support rural health care
providers with the costs of broadband and other communications services
for patients in rural areas that may have limited resources, fewer
doctors, and higher rates than urban areas.
DATES: Comments are due on or before April 24, 2023, and reply comments
are due on or before May 22, 2023. If you anticipate that you will be
submitting comments but find it difficult to do so within the period of
time allowed by this document, you should advise the contact listed as
soon as possible.
ADDRESSES: Pursuant to Sec. Sec. 1.415 and 1.419 of the Commission's
rules, 47 CFR 1.415, 1.419, interested parties may file comments and
reply comments. You may submit comments, identified by WC Docket No.
17-310, by any of the following methods:
Electronic Filers: Comments may be filed electronically using the
internet by accessing the ECFS: <a href="https://www.fcc.gov/ecfs/">https://www.fcc.gov/ecfs/</a>.
Paper Filers: Parties who choose to file by paper must file an
original and one copy of each filing. Filings can be sent by commercial
overnight courier or by first-class or overnight U.S. Postal Service
mail. All filings must be addressed to the Commission's Secretary,
Office of the Secretary, Federal Communications Commission.
Commercial overnight mail (other than U.S. Postal Service Express
Mail and Priority Mail) must be sent to 9050 Junction Drive, Annapolis
Junction, MD 20701.
U.S. Postal Service first-class, Express, and Priority mail must be
addressed to 45 L Street NE, Washington, DC 20554.
Effective March 19, 2020, and until further notice, the Commission
no longer accepts any hand or messenger delivered filings at its
headquarters. This is a temporary measure taken to help protect the
health and safety of individuals, and to mitigate the transmission of
COVID-19. See FCC Announces Closure of FCC Headquarters Open Window and
Change in Hand-Delivery Policy, Public Notice, DA 20-304 (March 19,
2020), <a href="https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy">https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy</a>.
People with Disabilities: To request materials in accessible
formats for people with disabilities (Braille, large print, electronic
files, audio format), send an email to <a href="/cdn-cgi/l/email-protection#d9bfbabaece9ed99bfbabaf7beb6af"><span class="__cf_email__" data-cfemail="b5d3d6d6808581f5d3d6d69bd2dac3">[email protected]</span></a> or call the
Consumer & Governmental Affairs Bureau at (202) 418-0530 (voice), (202)
418-0432 (TTY).
FOR FURTHER INFORMATION CONTACT: Bryan P. Boyle <a href="/cdn-cgi/l/email-protection#98daeae1f9f6b6daf7e1f4fdd8fefbfbb6fff7ee"><span class="__cf_email__" data-cfemail="d597a7acb4bbfb97baacb9b095b3b6b6fbb2baa3">[email protected]</span></a>,
[[Page 17496]]
Wireline Competition Bureau, 202-418-7400 or TTY: 202-418-0484.
Requests for accommodations should be made as soon as possible in order
to allow the agency to satisfy such requests whenever possible. Send an
email to <a href="/cdn-cgi/l/email-protection#680e0b0b5d585c280e0b0b460f071e"><span class="__cf_email__" data-cfemail="c0a6a3a3f5f0f480a6a3a3eea7afb6">[email protected]</span></a> or call the Consumer and Governmental Affairs
Bureau at (202) 418-0530.
SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's
Promoting Telehealth in Rural America; Second Further Notice of
Proposed Rulemaking (Second FNPRM) in WC Docket No. 17-310; FCC No. 23-
6, adopted January 26, 2023 and released January 27, 2023. The full
text of this document is available for public inspection during regular
business hours at Commission's headquarters 45 L Street NE, Washington,
DC 20554 or at the following internet address: <a href="https://docs.fcc.gov/public/attachments/FCC-23-6A1.pdf">https://docs.fcc.gov/public/attachments/FCC-23-6A1.pdf</a>. The Order on Reconsideration, Second
Report and Order and Order (Orders) that was adopted concurrently with
the Second Further Notice of Proposed Rulemaking is to be published
elsewhere in the Federal Register.
Introduction
The Second Further Notice of Proposed Rulemaking (Second FNPRM),
continues the Commission's efforts to improve the Rural Health Care
(RHC) Program. The RHC Program supports rural health care providers
with the costs of broadband and other communications services so that
they can serve patients in rural areas that may have limited resources,
fewer doctors, and higher rates for broadband and communications
services than urban areas. Telehealth and telemedicine services, which
expanded considerably during the COVID-19 pandemic, have also become
essential tools for the delivery of health care to millions of rural
Americans. These services bridge the vast geographic distances that
separate health care facilities, enabling patients to receive high-
quality medical care without sometimes lengthy or burdensome travel.
The RHC Program promotes telehealth by providing financial support to
eligible health care providers for broadband and telecommunications
services.
The Second FNPRM proposes revisions to the rate determination
rules, seeks comment on to reinstating the cap on support for satellite
services, proposes to make it easier for health care providers to
receive RHC Program funding as soon as they become eligible, propose to
align the deadline to request a Service Provider Identification Number
(SPIN) change with the invoice filling deadline, and seeks comment on
revisions to data collected in the Telecom Program.
Second Further Notice of Proposed Rulemaking
The Second FNPRM proposes modifications to the three rural rate
determination methods in the Telecom Program, including changes to the
market-based approach of Methods 1 and 2 and new evidentiary
requirements for justifying cost-based rates under Method 3. The
Commission also proposes to simplify urban rate rules by eliminating
the ``standard urban distance'' distinction and seeks specific comment
on sources for urban rates as well as general comment on the urban rate
rules. Next, the Commission seeks comment on reinstating the cap on
support for satellite services that the Commission eliminated when it
adopted the Rates Database and on amending Health Care Connect Fund
(HCF) Program rules to make equipment supporting Telecom Program
services eligible. In addition, to make it easier for health care
providers to receive RHC Program funding as soon as they become
eligible entities, the Commission proposes a conditional eligibility
process to allow entities that will be eligible health care providers
in the future to engage in competitive bidding and file Requests for
Funding before they become eligible. The Commission also proposes to
align the deadline to request a Service Provider Identification Number
(SPIN) change with the invoice filing deadline and seek comment on a
post-commitment process to amend evergreen contract dates. The
Commission concludes by seeking comment on proposed revisions to FCC
Form 466 intended to improve the quality of Telecom Program data.
Rural Rates. In the Order on Reconsideration published elsewhere in
the Federal Register, the Commission grants the petitions seeking
reconsideration of the Telecom Program Rates Database and restore
Methods 1, 2, and 3 for calculating rural rates in the Telecom Program
effective for funding year 2024. Although the Commission believes
restoring Methods 1, 2, and 3 is the best of the currently available
options to ensure that healthcare providers have adequate, predictable
support in the short term, the Commission also recognizes that
improvements to these methods may be necessary for the long term given
the issues that the Commission has previously cited with respect to
these rate calculation methodologies. Therefore, in the following
sections, the Commission proposes modifications to the three methods to
improve the overall calculation of rural rates, make rate calculations
simpler to administer, and reduce waste, fraud, and abuse in the
Telecom Program for funding year 2024 and beyond. The Commission
proposals are similar to the now-reinstated Methods 1 through 3 in that
they contain multiple ways to calculate rural rates that are applied
sequentially. While the Commission seeks comment specifically on the
proposed modification to the methods, at the outset the Commission
seeks comment generally on alternative rural rate calculation methods.
In proposing alternative rate methodologies, commenters should be
specific, point the Commission to available data sources to support any
alternative methodology, and explain how any alternative methodology
would be more advantageous in protecting the Fund against waste, fraud,
and abuse.
As an initial matter, the Commission addresses several matters
applicable to rural rates regardless of the method used. For both
market-based calculations and cost-based rates, the Commission proposes
that the rural rate not exceed the monthly rate in the contract or
other applicable agreement between the service provider and health care
provider. This safeguard exists in the rules related to the Rates
Database and ensures that rural rates will drop if market prices drop.
The Commission seeks comment on this proposal. Are there situations in
which it would be appropriate to base support on an amount higher than
the monthly rate in the contract or other applicable agreement?
Additionally, the Commission proposes that service providers with
multi-year contracts, including evergreen contracts, continue to be
required to justify rural rates only in the first year of the contract.
Given that service providers would not be expected to submit additional
bids within the duration of the multi-year contract, the Commission
believes it would be reasonable to exempt such contracts from requiring
additional rural rates justifications during the duration of the
contract. The Commission seeks comment on this proposal. The Commission
also seeks comment on whether a rural rate approval for a single year
contract for the same health care provider for the same service should
be effective for multiple funding years to reduce administrative
burdens associated with filing rural rate justifications every year. If
so, for how
[[Page 17497]]
many years should an approval be effective?
The Commission seeks comment on whether the Commission should offer
guidance on which point in the procurement and funding cycle service
providers should determine rural rates. The Bureau previously advised
that service providers should determine the rural rate before
responding to a health care provider's request for bids. If the
Commission offers further guidance, should it alter the guidance the
Bureau previously offered? The Commission also seeks comment on whether
additional clarification is needed regarding what constitutes
``comparable rural areas'' for determining rural rates. Are health care
providers and service providers currently able to determine what
constitute a ``comparable rural area?'' If the Commission were to offer
a clarification on what constitutes ``comparable rural areas,'' what
should the clarification state?
Market-Based Calculations. The rules that the Commission reinstate
in the Order on Reconsideration published elsewhere in the Federal
Register require health care and service providers to first calculate
the rural rate by averaging rates offered by the service provider for
an identical or similar service in the rural area in which the health
care provider was located (Method 1), and in the event the service
provider does not provide such a service, the average of rates offered
by carriers other than the service provider (Method 2). The Commission
now proposes alternative sequential methods for determining rural
rates, which are called ``Method A'' and ``Method B'' for purposes of
the Second FNPRM:
Method A: The rural rate shall be the median of publicly available
rates charged by other service providers for the same or similar
services over the same distance in the rural area where the health care
provider is located.
Method B: If there are no publicly available rates charged by other
service providers for the same or similar services (that is, rates that
can be used under Method A), the rural rate shall be the median of the
rates that the carrier actually charges to non-health care provider
commercial customers for the same or similar services provided in the
rural area where the health care provider is located.
This proposal differs from Methods 1 and 2 in two primary respects.
First, the new proposed calculations would be based on the median of
inputs, rather than their average. Calculating rural rates using the
median will mute the effect that a small number of abnormally high or
low inputs would have on the calculated rural rate. The Commission
seeks comment on the methodology. Would calculating rural rates using
averages be preferable to using medians? If so, why? Are there other
ways that the Commission should consider calculating rural rates?
The second major way that the proposal varies from Methods 1 and 2
is that the default calculation in the proposal is based on rates
charged by other service providers, meaning that a service provider
would only be able to use its own rates to calculate the rural rate if
there are no applicable rates from other service providers. This change
could improve program integrity and provide administrative benefits. As
to program integrity, shifting the default rural rates calculation to
rates from other service providers could ensure that rural rates in the
Telecom Program better reflect market conditions. A service provider
would not enjoy inflated rural rates simply because it charges inflated
rates to customers outside of the Telecom Program. The Commission seeks
stakeholder feedback on program integrity implications of the proposal
to use rates charged by other service providers as the default for
calculating rural rates. Are there any concerns with service providers
using competitor's rates to determine rural rates instead of using
their own rates? What are the benefits? Are there benefits to using the
service provider's own rates as the default as Method 1 does?
As to administration, the availability of rural rates on the Open
Data platform on the Administrator's website could simplify the rates
determination process if the Administrator were to build a tool that
allows the filer of a Request for Funding to select the specific
funding requests, i.e., prices from past request that would be used as
inputs to Method A. The tool would then determine the rural rate under
Method A on behalf of the health care provider before it certifies its
Request for Funding. The automated process would not pre-determine
which health care provider is in a similar rural area as the health
care provider applicant. That would be left to the service provider to
determine. During application review, the Administrator would verify
that the sites from the inputs are in a similar rural area to the
health care provider, just as it has done under the now reinstated
Methods 1 and 2.
The Commission seeks comment on developing an automated process to
calculate rural rates, to the extent possible, by having USAC's website
auto-generate the rural rate after the health care and/or service
provider selects sites that are in the same rural area as the HCP.
Would this help alleviate administrative burdens associated with
calculating rural rates? Should filers be permitted to add rural rates
outside of Open Data to be included in the calculation? Are there any
circumstances in which a filer should be permitted to exclude a rate
even if the rate is for the same or similar services over the same
distance in the rural area where the health care provider is located?
Are there any disadvantages to automating the rate calculation process
in this way? Would a challenge process outside of the normal appeals
process be necessary? If so, how should such a challenge process
operate? Do commenters have any alternative methods of administering
these proposed rate methodology changes that would increase efficiency
and transparency? Commenters are encouraged to provide specific
suggestions and feedback on how to best administer changes to the rates
determination process.
The Commission seeks comment on other iterations of the proposed
Methods A and B. For instance, one alternative to the proposal would be
to use the lower of the rural rates calculated under Methods A and B.
This alternative would ensure that the Fund reaps the benefits of
reductions in pricing from the service provider for the applicable
funding request or in the overall market. The Commission seeks comment
on the advantages and disadvantages of the approach.
The Commission also seeks comment on the rates that should be used
for Methods A and B under the proposal. For Method A, are there other
sources of publicly available rate information to be considered, such
as tariffed rates? Should Method A inputs be limited to data available
in Open Data? Do commenters agree that the data available in Open Data
would be sufficient for Program participants to determine a rural rate
under Method A? If not, what additional information would be required
in Open Data to make such a rate determination? For the proposed Method
B, the Commission seeks comment on whether to include the median of all
of the service provider's own rates for the same or similar services,
including rates for USF-supported services, which are currently
excluded from Method 1 calculations either in situations where there
are no publicly available rates or tariffed rates outside of the
service provider's own rates or in all situations. For Method B, should
service providers use additional information available in their own
records to make a more granular similarity determination?
[[Page 17498]]
For both proposed Methods A and B, the Commission seeks comment on
whether to include both healthcare provider and non-healthcare provider
commercial customers in the rural area in which the healthcare provider
is located to calculate the rural rate. Do commenters have any concerns
with allowing service providers to rely on all of their own rates,
including health care provider rates? How should Methods A and B
account for the potential price variations caused by term and volume
discounts? Do commenters have any concerns that the proposed Methods
would not be suitable for health care providers in Alaska? Commenters
are encouraged to be specific with their concerns.
Cost-Based Rates. The Commission proposes that service providers
continue to have the option to submit a cost-based rate if they cannot
calculate a rural rate using Methods A or B. Under the rate
determination rules the Commission reinstates, service providers may
request approval of a cost-based rate under Method 3 from the
Commission (for interstate services) or a state commission (for
intrastate services) if there are no rates for the same or similar
services in the rural area in which the health care provider is
located, or the service provider reasonably determines that the
calculated rural rate would not be compensatory. The Commission's rules
require the service provider to submit a justification of its requested
rural rate, including an itemization of the costs of providing the
service requested by the eligible health care provider. To comply with
the requirement, the request for approval of a cost-based rural rate
requires service providers to include a cost study that demonstrates
how the costs of providing services were allocated to RHC Program
customers.
In the Promoting Telehealth Report and Order (2019 R&O) (FCC 19-78
rel. August 20, 2019 (84 FR 54952, October 11, 2019)), the Commission
eliminated the cost-based method of determining rates and instead
concluded that submitting a cost-based rate should serve only as a
safety valve for service providers that have no other means of
determining a rural rate. The Commission reasoned that implementation
of the Rates Database made it unlikely that service providers would be
unable to determine a rural rate with the data provided in the
database. The Commission established a waiver process that allowed
service providers to use a cost-based rate mechanism in ``extreme
cases'' where the provider could show that the applicable rural rate
from the Rates Database ``would result in objective, measurable
economic injury.'' Now that the Rates Database has been eliminated and
the previous rate determination rules have been reinstated, the
Commission proposes to modify the cost-based rate-determination method
to include specific evidentiary requirements to increase transparency
in how service providers calculate cost-based rates when a rural rate
cannot be calculated under Methods A or B or the carrier reasonably
determines that the rural rate calculated under Methods A or B would
not generate a reasonably compensatory rate.
The Commission proposes a revised cost-based method that will
require service providers seeking approval of a cost-based rate to
satisfy the same evidentiary requirements that the Commission adopted
as required for waiver of the Rates Database rules in the 2019 R&O.
When service providers submit a cost-based rate, the Commission
proposes to require service providers to include all financial data and
other information to verify the service provider's assertions,
including, at a minimum, the following information:
<bullet> Company-wide and rural health care service gross
investment, accumulated depreciation, deferred state and Federal income
taxes, and net investment; capital costs by category expressed as
annual figures (e.g., depreciation expense, state and Federal income
tax expense, return on net investment); operating expenses by category
(e.g., maintenance expense, administrative and other overhead expenses,
and tax expense other than income tax expense); the applicable state
and Federal income tax rates; fixed charges (e.g., interest expense);
and any income tax adjustments;
<bullet> An explanation and a set of detailed spreadsheets showing
the direct assignment of costs to the rural health care service and how
company-wide common costs are allocated among the company's services,
including the rural health care service, and the result of these direct
assignments and allocations as necessary to develop a rate for the
rural health care service;
<bullet> The company-wide and rural health care service costs for
the most recent calendar year for which full-time actual, historical
cost data are available;
<bullet> Projections of the company-wide and rural health care
service costs for the funding year in question and an explanation of
these projections;
<bullet> Actual monthly demand data for the rural health care
service for the most recent three calendar years (if applicable);
<bullet> Projections of the monthly demand for the rural health
care service for the funding year in question, and the data and details
on the methodology used to make that projection;
<bullet> The annual revenue requirement (capital costs and
operating expenses expressed as an annual number plus a return on net
investment) and the rate for the funded service (annual revenue
requirement divided by annual demand divided by 12 equals the monthly
rate for the service), assuming one rate element for the service, based
on the projected rural health care service costs and demands;
<bullet> Audited financial statements and notes to the financial
statements, if available, and otherwise unaudited financial statements
for the most recent three fiscal years, specifically, the cash flow
statement, income statement, and balance sheets. Such statements shall
include information regarding costs and revenues associated with, or
used as a starting point to develop, the rural health care service
rate; and
<bullet> Density characteristics of the rural area or other
relevant geographical areas including square miles, road miles,
mountains, bodies of water, lack of roads, remoteness, challenges and
costs associated with transporting fuel, satellite and backhaul
availability, extreme weather conditions, challenging topography, short
construction season, or any other characteristics that contribute to
the high cost of servicing the health care providers.
The Commission understands that stakeholders generally disfavored
the evidentiary requirements for the cost-based waiver for determining
rural rates because of the burdensome nature of the information
requested, the possibility that the cost-based method would not provide
sufficient support for those that could not calculate their rates using
the Rates Database and the fact that these evidentiary requirements go
far beyond the evidentiary requirements for Method 3. However, the
Commission adopted the waiver process as a safety valve given how
infrequently the cost-based method has been used in the Telecom
Program's history and the small likelihood that providers could not
determine the rural rate using the Rates Database. The Commission
believes that such a comprehensive cost-based process would likely
incentivize service providers to make every effort to justify their
rates under Methods A or B, which would be much simpler for both the
Administrator and service providers. Nonetheless, in addition to the
proposal, the Commission seeks comment on alternative evidentiary
requirements that can assist the Bureau
[[Page 17499]]
and Administrator in evaluating cost-based rates in the event that
service providers have no other way of determining rates. Do commenters
have any recommendations that would increase transparency and
efficiency in submitting and reviewing cost-based rates? How common
would it be for service providers to have to use this cost-based rates
process? Are there changes that the Commission can make to the proposed
cost-based rates submission process that would mitigate administrative
burdens on service providers without compromising Program integrity?
How should service providers and the Bureau use the cost data to
determine a cost-based rate to be charged to an individual customer?
Should there be a deadline by which the Bureau must complete its cost-
based rate review and issue a rate determination? If so, how would such
a deadline operate in the event that a service provider submitted
incomplete or inaccurate information that required additional
submissions to the Bureau? Would the use of cost studies to determine
maximum rural rates decrease incentives for new infrastructure
investment in hard to serve areas? Do commenters have any concerns that
the proposed cost-based rate would not be suitable for health care
providers in Alaska? Commenters are strongly encouraged to share
specific recommendations.
Urban Rates. The Commission next proposes to simplify and seek
further comment on future urban rate determination rules for the
Telecom Program. The Telecom Program subsidizes the difference between
the urban rate for a service in the health care provider's State, which
must be ``reasonably comparable to the rates charged for similar
services in urban areas in that State,'' and the rural rate, which is
``the rate for similar services provided to other customers in
comparable rural areas'' in the State. The rules that the Commission
restores on reconsideration elsewhere in the Federal Register state
that urban rates ``shall be a rate no higher than the highest tariffed
or publicly-available rate charged to a commercial customer for a
functionally similar service in any city with a population of 50,000 or
more in that state.'' Following the decision in the Order on
Reconsideration published elsewhere in the Federal Register to
eliminate the Rates Database and restore the previous rules for
determining urban rates effective funding year 2024, the Commission
proposes to simplify the urban rate rule by eliminating the ``standard
urban distance'' distinction from it and now seek comment on whether
any additional changes to those rules are warranted.
Standard Urban Distance. The rules that the Commission reinstates
published elsewhere in the Federal Register provide that, if the
service is provided over a distance greater than the standard urban
distance, which is the average of the longest diameters of all cities
with a population of 50,000 or more within a state, the urban rate is
the rate no higher than the highest tariffed or publicly-available rate
provided over the standard urban distance. The 2019 R&O eliminated the
standard urban distance distinction in adopting the Rates Database. The
Commission proposes to eliminate this distinction between services
provided over and within the standard urban distance and to base all
urban rates calculations on rates provided in a city, rather than over
the standard urban distance. The Commission expects that eliminating
this distinction will simplify the process for determining an urban
rate and will not adversely impact most health care providers because
few Telecom Program participants calculate urban rates using the
standard urban distance. The Commission seeks comment on the impact
that this would have on urban rates and administrative burdens. Before
the adoption of the Rates Database, how common was it to base urban
rates calculations on services in a city (rather than services over the
standard urban distance)? Would urban rates increase unduly if the
Commission makes this change? The Commission seeks comment on whether
to change the standard for ``urban'' from a city with a population of
at least 50,000. Will changes to the standard for ``urban'' in
conjunction with the elimination of the standard urban distance cause
an increase in urban rates?
Sources of Urban Rates. Under the pre-funding year 2020 urban rate
rules that the Commission reinstates in the Order on Reconsideration
published elsewhere in the Federal Register, documentation may be
required to substantiate the applicable urban rate. The urban rate is
determined by the health care provider, often with the assistance of a
consultant or carrier, and reported on the FCC Form 466. To document
the urban rate, health care providers may use ``tariff pages,
contracts, a letter on company letterhead from the urban service
provider, rate pricing information printed from the urban service
provider's website or similar documentation showing how the urban rate
was obtained.'' In the alternative, health care providers have
historically utilized the urban rates listed on the Administrator's
website for certain services in certain states. These urban rates are
determined by reviewing tariff information on file with the Commission.
One advantage of utilizing the urban rates posted to the
Administrator's website is that health care providers did not need to
provide additional documentation on their FCC Form 466. With the
Commission's decision to eliminate the Rates Database, should the
Administrator post urban rates as it did prior to the 2019 R&O or is
the posting of urban rates of limited utility and unnecessary? Are
there changes or updates the Administrator should make to the urban
rates it posts on its website? While the Commission has made the
decision to eliminate the Rates Database, the database contains urban
rates that were collected as part of the database creation process. If
the Administrator resumes posting urban rates, should the urban rates
currently found in the Rates Database be included in the posted list,
or have too many anomalies been identified that will preclude the use
of those rates by participants in the Telecom Program?
On a forward going basis, should there be any changes to the now-
reinstated urban rate rules? When exploring additional sources of urban
rates, should the Commission allow health care providers to use the
median of urban rates in the Rates Database as the urban rate? Parties
lodging complaints about the use of the Rates Database to determine
rural rates had relatively few complaints about its use to determine
urban rates. Should the Commission require the Administrator to
maintain a Rates Database for urban rates and require that urban rates
be calculated utilizing the Rates Database? Alternatively, should a
rate survey be used to determine current urban rates instead of relying
on the Administrator to determine and post rates? If so, after the
initial compilation of the survey, how often should it be updated? Are
there any additional factors that the Commission should take into
account for calculating urban rates in the Telecom Program?
Threshold for ``Urban.'' The standard for ``urban'' of being
``functionally similar service in any city with a population of 50,000
or more in that state'' that the Commission reinstates published
elsewhere in the Federal Register was originally adopted in 2003.
Should the Commission maintain 50,000 as the population threshold for
determining an urban area? Is there another population number that
better captures the full spectrum of urban
[[Page 17500]]
areas or is there a value collected by a different agency that better
captures the picture of an urban area?
Network Function. The Commission seeks comment on two matters
related to how networks function. First, the Commission seeks comment
on reinstating the cap on support for satellite services that was in
place before the adoption of the Rates Database. The Commission then
seeks comment on the eligibility in the HCF Program of equipment that
supports services funded in the Telecom Program.
Satellite Services. The Commission seeks comment on reinstating the
cap on support for satellite services in the Telecom Program at the
amount of support the health care provider would have received for
similar terrestrial-based services. When the Commission established the
RHC Program, satellite service was the only available
telecommunications service available in some rural areas. However,
rural health care providers in those areas generally did not receive
Telecom Program discounts because satellite service rates typically did
not vary between urban and rural areas. In 2003, the Commission revised
its rules to allow eligible rural health care providers to base Telecom
Program support for satellite services on urban rates for functionally
similar wireline services. However, because satellite services were
often significantly more expensive than terrestrial-based services, in
rural areas where a functionally similar terrestrial-based service was
available the Commission capped support for satellite service at the
amount that the health care provider would receive had it chosen the
terrestrial-based service. If an eligible rural health care provider
chose a satellite-based service that was more expensive than the
available equivalent terrestrial-base service, the health care provider
was responsible for the additional cost. In the 2019 R&O, the
Commission eliminated the cap, effective for funding year 2020,
explaining that the limitation on support for satellite services was no
longer necessary because rural rates would be determined by the Rates
Database and costs for satellite services were decreasing, while also
acknowledging that eliminating the cap furthered technological
neutrality and that improvements to competitive bidding rules would
reduce the need for the cap.
The Commission seeks comment on reinstating the cap on satellite
services at the lower of the satellite service rate or the terrestrial
service rate and allow rural health care providers to receive discounts
for satellite service up to the amount providers would have received if
they purchased functionally similar terrestrial-based alternatives,
even where terrestrial-based services are available. It appears that
the constraints on the price of satellite services that the Commission
predicted when it eliminated the cap on satellite services did not come
into fruition. Since the elimination of the cap and the waiver of the
rates database, Telecom Program support for satellite services has
increased significantly. The Commitments for Satellite Services dipped
slightly in funding year 2020 but increased significantly after that.
Funding Year Amounts: 2019--$28,726,457; 2020--$26,583,278; 2021--
$39,487,136; and 2022--$60,098,460.
The steady growth in demand for satellite services may demonstrate
the need to reinstitute the satellite funding cap. Without the
constraints on support for satellite services imposed by the Rates
Database, it appears that commitments for satellite services could
increase to an unsustainable level. As an initial matter, the
Commission seeks comment on the significance of the increase in
commitments for satellite services. Does the increase reflect that the
prices charged for satellite services in the Telecom Program increased
after the cap was eliminated or are health care providers selecting
satellite services because those services are now more competitive with
terrestrial-based services? Are service providers less likely to bid on
or upgrade networks for terrestrial services because the cap was
lifted? Have rates for satellite services due to the availability of
low Earth orbit (LEO) satellites dropped enough to make the cap no
longer necessary? If that is the case, why did demand for satellite
services increase so significantly in recent years? Are there other
factors the Commission should consider in determining whether to retain
the cap on support for satellite services? For example, is it
appropriate to apply the cap in cases where satellite service provides
redundancy in the absence of alternative terrestrial-based route
diversity? Could reinstatement of the cap discourage investment in LEO
satellites? What impact should the RHC Program's historical preference
for technological neutrality and the fact that there previously was a
cap on satellite services have on this determination? If the Commission
reinstitutes the cap, are there other changes that should be made to
it? Should the Commission not apply the cap to funding requests
supported by satellite service contracts that were entered into before
reinstatement of the cap? Do commenters in Alaska have any concerns
with reinstating the cap, given the importance of satellite service in
Alaska?
HCF Program Eligible Equipment. The Commission also seeks comment
on whether to amend HCF Program rules to make eligible network
equipment necessary to make functional an eligible service supported
under the Telecom Program. Current HCF Program rules restrict the
eligibility of network equipment for individual applicants to equipment
necessary to make functional an eligible service supported under the
HCF Program. There is no analogous rule in the Telecom Program that
provides support for network equipment. Should the Commission consider
allowing HCF-eligible equipment to support both HCF and Telecom Program
services? Would such a change improve the reliability of Telecom
Program supported services? If the Commission were to make network
equipment for Telecom Program supported services eligible, what would
the financial impact be on the RHC Program? Would HCF Program funding
for equipment supporting Telecom Program services reduce Telecom
Program expenditures? Expanding the universe of supported equipment
would make it more likely that the internal cap would be exceeded.
Given the significantly higher discount rates already offered in the
Telecom Program, would it be sensible to increase the likelihood of
exceeding the internal cap to provide HCF Program funding to support
networks that traditionally have been supported in the Telecom Program
only? If the Commission implements the change, are there additional
safeguards to consider?
Conditional Approval of Eligibility for Future Eligible Health Care
Providers. The Commission proposes to amend RHC Program rules for
determining eligibility to allow entities that are not yet but will
become eligible health care providers in the near future to begin
receiving RHC Program funding shortly after they become eligible. Under
the Bureau-level Hope Community Order (DA 16-855 rel. July 28, 2016),
entities that are not yet eligible health care providers cannot receive
an eligibility approval, which is a prerequisite to initiating
competitive bidding and filing a Request for Funding, until they are
eligible health care providers. As a result of the restriction, if a
health care provider does not receive an eligibility approval in time
to complete competitive bidding and file a Request for Funding by the
close of the application filing window on April 1, the health care
provider would have to
[[Page 17501]]
wait until a subsequent funding year to receive RHC Program funding,
which could result in a delay of a full calendar year.
In order to address the delay in funding, the Commission proposes
to amend Sec. Sec. 54.601 and 54.622 of its rules to allow entities
that will soon be eligible health care providers to request and receive
a ``conditional approval of eligibility.'' Once the Administrator
approves an applicant's conditional eligibility, the applicant could
proceed to conduct competitive bidding and submit a Request for Funding
during the application filing window. To ensure that no funding is
disbursed for entities that are not yet eligible, the Administrator
would not issue a funding decision for the funding request until the
entity updates its eligibility request by providing documentation
showing that it is an eligible health care provider and the
Administrator issues a final eligibility approval. The conditional
approval of eligibility process would use the same forms used to
request eligibility approvals, which are the FCC Form 460 (Eligibility
and Registration Form) in the HCF Program and the FCC Form 465
(Description of Services Requested and Certification Form) in the
Telecom Program.
The Commission seeks comment on the potential impact of and
mechanics of the proposed rule changes. How many entities would be
impacted by the change? Are there any potential problems associated
with the proposal or any potential negative impact on the overall RHC
Program? Are any additional safeguards necessary beyond the restriction
against the Administrator issuing funding commitments before an entity
receives a final eligibility approval? Are there alternatives to the
conditional eligibility proposal that would more effectively allow
entities that are not yet eligible health care providers to receive RHC
Program funding? Finally, are there any RHC Program rule changes beyond
those that the Commission proposes that would be needed to implement
the conditional eligibility proposal?
Administrative Deadlines. The Commission addresses two matters
involving RHC Program deadlines. The Commission proposes to push back
the deadline for requesting Service Provider Identification Number
(SPIN) changes to align with the invoice deadline. The Commission also
seeks comment on whether a mechanism to allow post-commitment changes
to evergreen contract dates is necessary.
Service Provider Identification Number Change Deadlines. The
Commission proposes to revise the current deadline for requesting
Service Provider Identification Number (SPIN) changes from the service
delivery deadline to the invoice filing deadline. A SPIN is a unique
number that the Administrator assigns to an eligible service provider
seeking to participate in the universal service support programs. An
applicant under the HCF Program or Telecom Program may request either a
``corrective SPIN change'' (in cases not involving a change to the
service provider associated with the applicant's funding request
number) or ``operational SPIN change'' (in cases involving a change to
the service provider associated with the applicant's funding request
number). The current filing deadline to submit a SPIN change request is
no later than the service delivery deadline, which, with limited
exceptions, is June 30 of the funding year for which program support is
sought. The Commission established a SPIN change deadline aligned with
the service delivery deadline to ensure consistency with the E-Rate
Program and reduce the number of requests for extension of the invoice
deadline.
The Schools, Health and Libraries Broadband Coalition (SHLB)
request that the Commission change the current deadline to make a
corrective SPIN change from the service delivery deadline to the
invoice filing deadline, which typically falls on October 28. SHLB
maintains that the nature of corrective SPIN changes creates a
``recurring hardship for applicants'' unable to meet the deadline
which, in turn, results in deadline waiver requests filed with the
Commission. According to SHLB, two commonly recurring situations
support a change to the corrective SPIN change deadline: (1) mergers
and acquisitions that can occur at any time during the funding year and
(2) a service provider that assigns one of its multiple SPINs to a
funding request without advising the healthcare provider as to the
correct SPIN before invoicing begins, a situation that, in many
instances, occurs after the service delivery deadline has passed. SHLB
maintains that changing the deadline to request a corrective SPIN
change to October 28 will provide the Administrator with sufficient
time to process the change request without the need for applicants to
request deadline waivers from the Commission.
The Commission tentatively agrees with SHLB that the current
deadline for requesting corrective SPIN changes imposes unnecessary
burdens that a later-in-time deadline will largely eliminate. Delaying
the deadline by 120 days (from June 30 to October 28 in most cases)
would reduce the need for applicants to seek, and for the Commission to
address, waivers of the current corrective SPIN change deadline that
result from the types of situations described by SHLB, while still
maintaining an administratively reasonable date by which such change
requests must be made. Although SHLB focused its request on corrective
SPIN changes only, the Commission concludes that it may be needlessly
confusing to establish two different SPIN change request deadlines
depending on whether the request is corrective or operational in
nature. Accordingly, the Commission proposes to change the deadline for
requesting both corrective and operational SPIN changes from the
current service delivery deadline to the invoicing filing deadline. The
Commission seeks comment on the proposal. Are there other benefits to
the change? The Commission anticipates that one potentially undesirable
consequence of the change is that it may cause Program participants to
delay in filing SPIN change requests, which could result in Program
participants missing the invoice deadline. If the SPIN change deadline
is moved to the invoice deadline and the health care provider files a
SPIN change request so close to the deadline that the Administrator
cannot process the request before the invoice deadline, the health care
provider will not be able to submit invoices. Does the flexibility this
change would offer to health care providers justify the disadvantage to
health care providers who are unable to invoice because they filed a
SPIN change request too close to the deadline? Parties often indicate
that alignment between RHC Program rules and E-Rate Program rules
eliminates confusion. Would bringing these deadlines out of alignment
create confusion? Are there other reasons not to adopt the same
deadline for both corrective and operational SPIN changes?
Evergreen Contract Date Changes. The Commission seeks comment on
whether there should be a process for health care providers to change
evergreen contract dates following a funding commitment. Evergreen
contracts are multi-year agreements under which covered services are
exempt from the competitive bidding requirements for the life of the
contract. When the Administrator issues a funding commitment letter, it
sets the period for an evergreen contract based on the estimated
service start and end dates provided by the health care provider on the
FCC Form 462. However, services sometimes start after the estimated
[[Page 17502]]
service start date, which means that the evergreen status of the
contract expires before it would have if the evergreen designation
period was based on the actual service start date. The Commission seeks
comment on whether there should be a means for a healthcare provider to
change evergreen contract dates. Is such an alternative necessary and,
if so, how could it be accomplished? Would an alternative means require
a change in the Commission's rules or could the current rules be
interpreted to allow for evergreen contract date changes? What would be
the impact of such a change on the duration of evergreen contracts?
Would allowing program participants to change evergreen contract dates
make it more difficult for the Administrator to process funding
requests submitted pursuant to such contracts?
FCC From 466. The Commission seeks comment on proposed revisions to
the Funding Request and Certification Form (FCC Form 466), including
service-specific details that could both improve the accuracy of
similar service categorizations under the existing Method 1 and Method
2, or the alternatives the Commission proposes in the Second FNPRM, and
also result in more accurate cost-based rates. To ensure the reporting
of accurate data, the Commission proposes to begin collecting the data
from service providers because they are in the best position to furnish
it.
In the Promoting Telehealth in Rural America FNPRM (2022 FNPRM)
(FCC 22-15 rel. February 22, 2022 (87 FR 14421, March 15, 2022)), the
Commission sought general comment on both existing Telecom Program data
collected through current program forms as well as potential changes to
the categorization and details of Telecom Program services and data
reported on the FCC Form 466. Certain data currently collected appears
to be too vague and fails to capture details of the purchased services,
resulting in significantly different monthly rates for services broadly
categorized that report comparable bandwidths but likely vary
significantly. The Commission requested feedback on updating the
Telecom Program's categorization of services to more accurately reflect
the functionality and cost of services purchased by incorporating data
points such as details of service level agreements (SLAs). The
Commission also sought comment on collecting data that would classify
services based upon functionality, regardless of the commercial name
used by the service provider to describe the service. The Commission
then sought general comment on revisions to the FCC Form 466 and other
Telecom Program forms and corresponding USAC online portals that would
improve the accuracy of urban and rural rate determinations and ensure
program integrity.
Commenters agreed that collecting more detailed data would result
in more accurate categorization of services purchased by health care
providers and improve program transparency. Alaska Communications
agreed that service categorizations should be more granular and
explained that services broadly categorized as ``dedicated'' include a
range of services and features, particularly security and reliability,
that significantly impact rates. Alaska Communications also noted that
the factors identified in the 2022 FNPRM ``can have a profound effect
on the functionality of the service from the perspective of the end
user.'' GCI suggested that the Commission could collect data on network
type, prioritization, and term and volume discounts. GCI also argued
that the Commission should collect data on services purchased rather
than requiring healthcare providers to submit highly detailed forms
when requesting service.
The Commission proposes revisions to the FCC Form 466 to improve
the quality, consistency, and level of detail of RHC Program data.
Improved data will also increase the accuracy of rural rates calculated
through the current three rate determination methods or through any
rate determination process that is established in the future. Through
continued review of data currently collected on the FCC Form 466, the
Commission has identified five primary issues impacting the ability to
calculate rates: (1) services reported by healthcare providers are not
defined by a single factor such as technology or speed; (2) some
reported rates are based on distance whereas others are not; (3) value-
added services beyond data transmission are not reported; (4) bundled
prices offered by service providers make ``apples-to-apples'' rate
comparisons difficult; and (5) the form does not measure the impact of
SLAs on the rates offered.
To address these issues and collect more detailed, accurate data,
the Commission proposes to revise the FCC Form 466 to collect more
granular information about the services purchased by health care
providers. The Commission proposes to collect the following service
details for each connection endpoint. The Commission seeks comment on
collecting the data on the FCC Form 466 and welcome comments on
additional or alternative service data that could improve the accuracy
and fairness of Telecom Program rates. The Commission especially
request recommendations for additional individual descriptors for the
following items being considered:
Contract Type. In many instances services reimbursed under the RHC
Program are often part of a contract that bundles many services
together. The Commission proposes adding a field that would indicate if
the underlying contract includes a bundle and what services the bundle
covers. Data collected would include the total number of end points
serviced, an indicator of the geographic region of coverage, the
contract's duration, discounts and service level agreements that apply
to the contract, and the contract's total price including RHC supported
services.
Service Details--Connection Endpoint Information. There would be
one entry for each endpoint.
Location of Endpoint--Geographically identifiable latitude and
longitude.
Distance (If Applicable)--The distance would be in line miles from
this endpoint to the far termination endpoint of the link or the
central server node. This would be reported if the service provider
uses it in the price calculation for this item. This field would be
reported in line miles and not straight-line or ``crow fly'' miles.
Connectivity--Point-to-Point, Point-to-Multipoint, Multipoint-to-
Multipoint
Application--Voice, Data, or Both
Service or Product--This is the service at the Endpoint. The user
would select from the following options: Link (a point-to-point
transmission), Device (at an endpoint for a link, such as a router or
switch other network-supporting equipment), or Service (provided
capabilities using the Links and Devices).
Equipment Vendor/Model--If a device or other equipment is used to
extend the eligible service to the endpoint, the user would list it
here. All devices would be required to be listed.
Technology--The user would report the technology at the endpoint
selecting from items such as: DSL (Digital Subscriber Line), DOCSIS
(Data Over Cable Service Interface Specifications), PON (Passive
Optimal Network), GPON (Gigabit Passive Optical Network and its
variants), and similar, as well as Other (Describe) and N/A.
Bandwidth (Down/Up)--This would be expressed in Mbps.
SLA Coverage--The user would select ``Yes'' or ``No'' to indicate
if this endpoint is covered.
Access Media--The user would describe the transmission media that
is present at the termination of the
[[Page 17503]]
endpoint at each individual facility. This can often, but not always,
be considered the last mile. The user would select from: copper, cable,
microwave, fiber, high Earth orbit satellite, LEO satellite, power
line, other, and N/A.
Monthly Price--This field contains the monthly price in dollars and
cents. This price would not include any uplift for SLA coverage, which
will be collected elsewhere in the form. If the overall contract price
is for a service such as MPLS, the price for each endpoint would be a
pro-rated amount associated with each endpoint. Any service portion
that cannot be associated with an endpoint, such as MPLS management,
would be separately reported as an individual line item(s) in the
``Additional Services and Differentiators'' section. MPLS and similar
multi-point solutions would not be reported as a single item. These
services would be pro-rated to individual endpoints.
Additional Services and Differentiators--This question would only
be used if the service cannot be described in the ``Service Details''
question.
Service Name--This would be a free text descriptor for the
provider's name of this item.
Class--This would be a product, service, or differentiator not
listed in the ``Service Details'' section because it is not associated
with a single endpoint.
Coverage Scope--This field would refer to the scope of the network
and contract that this item covers.
Period--This field would indicate the period length in months over
which this item will occur. For example, if an ``Installation'' service
is provided for the first year and one-half is part of the contract,
``18'' months would be shown.
SLA Coverage--The user would provide a ``Yes'' or ``No'' answer to
indicate if this service/differentiator is covered under an SLA.
Monthly Price--This would be expressed in dollars and cents. The
provider would pro-rate the monthly average cost for each item if the
overall contract price is a single number.
The Commission also proposes to collect SLA details on the FCC Form
466, which currently captures whether there is an SLA, but does not
collect specific details about it. The specifics of an SLA appear to
significantly impact telecommunications service rates and therefore are
likely to be a key factor when determining whether services are
similar. SLAs are typically sold at varying levels (sometimes with
descriptors such as Gold, Silver, or Bronze) and include availability
and reliability metrics, service maintenance and management,
delineations of service provider and customer responsibilities, and
penalties for non-performance. The Commission seeks comment on adding
the following fields to the FCC Form 466 and also seek comment on any
additional SLA data that could improve the accuracy and fairness of
Telecom Program rural rates, with one line for each SLA coverage area
or item:
Target Measurement--The user would report the item or class of
items to be measured such as Availability (Network Level Outage),
Availability (Link or Endpoint Level Outage), Repair/Restore Times
(MTTR--Mean Time To Repair), or On Site Spares (Response Time for
Equipment Under Contract).
SLA Level--High, Medium, or Low that may correspond to individual
provider schemes, such as Bronze, Silver, Gold.
Basic, Standard, Premium.
As classified by any system the service provider may use.
What functions are covered?
The user selects between Operations, Performance, Maintenance,
Install, Administration, and Compliance.
Period--The user would indicate the period length in months over
which this item will occur. For example, if an ``Installation'' service
is provided for 18 months, then ``18 months'' would be shown.
Penalties For Non-Performance? (Yes/No)--The user would indicate
whether there are specific monetary or other penalties for carrier non-
performance of specific SLA requirements written in the contract. The
user would select from a drop-down menu. General statements of intent
would not constitute a penalty.
SLA Scope--The user would report the scope of the contract that
this item covers. Examples of options filers would select from include:
Performance (what is delivered), Operations (how it is managed), and
Maintenance (how it is repaired).
Description of Target SLA Measurement--An optional free text field
the provider could use to enter further clarification for the specific
SLA item.
Price Uplift--The user would report the increase to the contract
service price (usually represented as a percentage) that the SLA
impacts. If it is not a separate line item in the contract, then the
price would be estimated and/or pro-rated by the provider over the
period and scope of SLA coverage.
The Commission seeks comment on whether to apply the proposed
revisions to FCC Form 466 to the HCF Funding Request Form (FCC Form
462) for consistency. What are the benefits and/or drawbacks of
revising FCC Form 462 to collect more granular service data?
Service Provider Filing. The Commission proposes to require service
providers to report the technical service details on the FCC Form 466.
In the 2022 FNPRM, the Commission sought comment on whether service
providers should report certain technical information about services
purchased that rural health care providers either cannot access or lack
the technical expertise to report. Commenters expressed concerns about
increasing technical reporting burdens on healthcare providers. GCI
argued that any new collection process should not burden rural health
care providers, who are often ``not well positioned to supply technical
and granular details about the services they need,'' and suggested
collecting additional data through the FCC Form 466. Alaska
Communications acknowledged that reporting technical service data would
be complicated for health care providers. The Alaska Native Health
Board (ANHB) and the Alaska Native Tribal Health Consortium (ANTHC)
both supported increased data collection but cautioned against
increasing reporting burdens on Tribal and other health care providers.
The Commission agrees with commenters that proposed increases in
the level of detailed technical data required on the FCC Form 466 would
likely exceed the technical expertise of most health care providers.
The service providers are in the best position to understand the
difference between a commercial term and a functional capability as
well as the difference between a capability and the underlying
technology. The Commission therefore proposes that service providers
input service information into the FCC Form 466. The Commission
tentatively concludes that shifting the responsibility for providing
technical details to the service provider would reduce burdens on
healthcare providers and improve data quality and consistency. The
Commission proposes that service providers provide the technical
connection endpoint data as well as any other technical service data
that is recommended by commenters and ultimately adopted by the
Commission as part of the proceeding. Additionally, the Commission
proposes that the service providers include the actual contract as an
attachment to the FCC Form 466. This would be treated confidentially
and would document the carrier's answers in an official company
document. To ensure the accuracy of the information provided, the
Commission
[[Page 17504]]
proposes that the service provider certify to the accuracy of service
provider-supplied information. The Commission seeks comment on these
proposals.
The Commission also seeks comment on the logistics of service
providers filling out portions of the FCC Form 466. The Commission
proposes that the FCC Form 466 be transferred to the service provider
after the health care provider completes the certifications on its
portion of the FCC Form 466. The Commission seeks comment on how
service providers completing part of the FCC Form 466 would impact
program deadlines. Should the filing window close denote the health
care provider's deadline for completing its portion of the FCC Form
466? If so, how much time should service providers have to complete
their portion of it? Finally, the Commission seeks comment on the
extent to which there might be a miscommunication between health care
and service providers about the requested services. In limited
circumstances, service providers may be selected to provide RHC Program
supported services without submitting a bid in response to an RFP. If
there is no contract, how can the Commission ensure that health care
providers and service providers agree as to the specific services that
will be provided?
Digital Equity and Inclusion. The Commission, as part of its
continuing effort to advance digital equity for all, including people
of color, persons with disabilities, persons who live in rural or
Tribal areas, and others who are or have been historically underserved,
marginalized, or adversely affected by persistent poverty or
inequality, invites comment on any equity-related considerations and
benefits (if any) that may be associated with the proposals and issues
discussed herein. Specifically, the Commission seeks comment on how the
proposals may promote or inhibit advances in diversity, equity,
inclusion, and accessibility, as well the scope of the Commission's
relevant legal authority.
Procedural Matters
Paperwork Reduction Act. The document contains proposed new or
modified information collection requirements. The Commission, as part
of its continuing effort to reduce paperwork burdens, invites the
general public and the Office of Management and Budget (OMB) to comment
on the information collection requirements contained in the document,
as required by the Paperwork Reduction Act of 1995, Public Law 104-13.
In addition, pursuant to the Small Business Paperwork Relief Act of
2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the Commission
seeks specific comment on how to further reduce the information
collection burden for small business concerns with fewer than 25
employees.
Ex Parte Rules--Permit-But-Disclose. The proceeding shall be
treated as a ``permit-but-disclose'' proceeding in accordance with the
Commission's ex parte rules. Persons making ex parte presentations must
file a copy of any written presentation or a memorandum summarizing any
oral presentation within two business days after the presentation
(unless a different deadline applicable to the Sunshine period
applies). Persons making oral ex parte presentations are reminded that
memoranda summarizing the presentation must (1) list all persons
attending or otherwise participating in the meeting at which the ex
parte presentation was made, and (2) summarize all data presented and
arguments made during the presentation. If the presentation consisted
in whole or in part of the presentation of data or arguments already
reflected in the presenter's written comments, memoranda or other
filings in the proceeding, the presenter may provide citations to such
data or arguments in his or her prior comments, memoranda, or other
filings (specifying the relevant page and/or paragraph numbers where
such data or arguments can be found) in lieu of summarizing them in the
memorandum. Documents shown or given to Commission staff during ex
parte meetings are deemed to be written ex parte presentations and must
be filed consistent with the Commission's rule Sec. 1.1206(b). In
proceedings governed by the Commission's rule Sec. 1.49(f) or for
which the Commission has made available a method of electronic filing,
written ex parte presentations and memoranda summarizing oral ex parte
presentations, and all attachments thereto, must be filed through the
electronic comment filing system available for that proceeding, and
must be filed in their native format (e.g., .doc, .xml, .ppt,
searchable .pdf). Participants in the proceeding should familiarize
themselves with the Commission's ex parte rules.
Initial Regulatory Flexibility Analysis
As required by the Regulatory Flexibility Act of 1980, as amended
(RFA), the Commission has prepared the Initial Regulatory Flexibility
Analysis (IRFA) of the possible significant economic impact on a
substantial number of small entities by the policies and rules proposed
in the Second FNPRM. Written public comments are requested on the IRFA.
Comments must be identified as responses to the IRFA and must be filed
by the deadlines for comments. The Commission will send a copy of the
Second FNPRM, including the IRFA, to the Chief Counsel for Advocacy of
the Small Business Administration (SBA).
Need for, and Objectives of, the Proposed Rules
Through the Second FNPRM, the Commission seeks to further improve
the Rural Health Care (RHC) Program's capacity to distribute
telecommunications and broadband support to health care providers--
especially small, rural healthcare providers (HCPs)--in the most
equitable and efficient manner as possible. Over the years, telehealth
has become an increasingly vital component of healthcare delivery to
rural Americans. Rural healthcare facilities are typically limited by
the equipment and supplies they have and the scope of services they can
offer which ultimately can have an impact on the availability of high-
quality health care. Therefore, the RHC Program plays a critical role
in overcoming some of the obstacles healthcare providers face in
healthcare delivery in rural communities. Considering the significance
of RHC Program support, the Commission proposes and seeks comment on
several measures to most effectively meet HCPs' needs while responsibly
distributing the RHC Program's limited funds.
In the Second FNPRM, the Commission seeks comment on proposed
revisions to rate determination rules, the cap on support for satellite
services, and revisions to data collected in the Telecom Program. The
Commission also proposes changes to allow health care providers to
receive funding shortly after they become eligible, allow participants
with multi-year and evergreen contracts to only justify rural rates in
the first year of the contract, and proposes changes to administrative
deadlines such as changes to amend program rules to align the deadline
for filing a Service Provider Identification Number (SPIN) change with
the invoice deadline.
Legal Basis
The legal basis for the Second FNPRM is contained in sections 1
through 4(g)(D)(i)-(j), 201-205, 254, 303I, and 403 of the
Communications Act of 1934, as amended by the Telecommunications Act of
1996, 47 U.S.C. 151 through 154(i), (j), 201 through 205, 254, 303(r),
and 403.
[[Page 17505]]
Description of Projected Reporting, Recordkeeping, and Other Compliance
Requirements for Small Entities
The reporting, recordkeeping, and other compliance requirements
proposed in the Second FNPRM likely would positively and negatively
financially impact both large and small entities, including healthcare
providers and service providers, and any resulting financial burdens
may disproportionately impact small entities given their typically more
limited resources. In weighing the likely financial benefits and
burdens of the proposed requirements, however, the Commission has
determined that the proposed changes would result in more equitable,
effective, efficient, clear, and predictable distribution of RHC
support, far outweighing any resultant financial burdens on small
entity participants.
Description and Estimate of the Number of Small Entities to Which the
Proposed Rules Will Apply
The RFA directs agencies to provide a description of and, where
feasible, an estimate of the number of small entities that may be
affected by the proposed rules, if adopted. The RFA generally defines
the term ``small entity'' as having the same meaning as the terms
``small business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A ``small business concern'' is one that: (1) is independently
owned and operated; (2) is not dominant in its field of operation; and
(3) satisfies any additional criteria established by the Small Business
Administration (SBA).
Small Businesses, Small Organizations, Small Governmental
Jurisdictions. The Commission actions, over time, may affect small
entities that are not easily categorized at present. The Commission
therefore describes, at the outset, three broad groups of small
entities that could be directly affected herein. First, while there are
industry specific size standards for small businesses that are used in
the regulatory flexibility analysis, according to data from the SBA's
Office of Advocacy, in general a small business is an independent
business having fewer than 500 employees. These types of small
businesses represent 99.9 percent of all businesses in the United
States which translates to 31.7 million businesses.
Next, the type of small entity described as a ``small
organization'' is generally ``any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field.''
The Internal Revenue Service (IRS) uses a revenue benchmark of $50,000
or less to delineate its annual electronic filing requirements for
small exempt organizations. Nationwide, for tax year 2018, there were
approximately 571,709 small exempt organizations in the U.S. reporting
revenues of $50,000 or less according to the registration and tax data
for exempt organizations available from the IRS.
Finally, the small entity described as a ``small governmental
jurisdiction'' is defined generally as ``governments of cities,
counties, towns, townships, villages, school districts, or special
districts, with a population of less than fifty thousand.'' U.S. Census
Bureau data from the 2017 Census of Governments indicates that there
were 90,075 local governmental jurisdictions consisting of general
purpose governments and special purpose governments in the United
States. Of this number there were 39, 931 general purpose governments
(county, municipal and town or township) with populations of less than
50,000 and 12,040 special purpose governments (independent school
districts) with populations of less than 50,000. Based on the 2017 U.S.
Census Bureau data we estimate that at least 48, 971 entities fall in
the category of ``small governmental jurisdictions.''
Small entities potentially affected by the proposals herein include
eligible rural non-profit and public health care providers and the
eligible service providers offering them services, including
telecommunications service providers, internet Service Providers
(ISPs), and vendors of the services and equipment used for dedicated
broadband networks.
Healthcare Providers
Offices of Physicians (except Mental Health Specialists). This U.S.
industry comprises establishments of health practitioners having the
degree of M.D. (Doctor of Medicine) or D.O. (Doctor of Osteopathy)
primarily engaged in the independent practice of general or specialized
medicine (except psychiatry or psychoanalysis) or surgery. These
practitioners operate private or group practices in their own offices
(e.g., centers, clinics) or in the facilities of others, such as
hospitals or HMO medical centers. The SBA has created a size standard
for this industry, which is annual receipts of $12 million or less.
According to 2012 U.S. Economic Census, 152,468 firms operated
throughout the entire year in this industry. Of that number, 147,718
had annual receipts of less than $10 million, while 3,108 firms had
annual receipts between $10 million and $24,999,999. Based on the data,
the Commission concludes that a majority of firms operating in this
industry are small under the applicable size standard.
Offices of Dentists. This U.S. industry comprises establishments of
health practitioners having the degree of D.M.D. (Doctor of Dental
Medicine), D.D.S. (Doctor of Dental Surgery), or D.D.Sc. (Doctor of
Dental Science) primarily engaged in the independent practice of
general or specialized dentistry or dental surgery. These practitioners
operate private or group practices in their own offices (e.g., centers,
clinics) or in the facilities of others, such as hospitals or HMO
medical centers. They can provide either comprehensive preventive,
cosmetic, or emergency care, or specialize in a single field of
dentistry. The SBA has established a size standard for that industry of
annual receipts of $8 million or less. The 2012 U.S. Economic Census
indicates that 115,268 firms operated in the dental industry throughout
the entire year. Of that number 114,417 had annual receipts of less
than $5 million, while 651 firms had annual receipts between $5 million
and $9,999,999. Based on the data, the Commission concludes that a
majority of business in the dental industry are small under the
applicable standard.
Offices of Chiropractors. This U.S. industry comprises
establishments of health practitioners having the degree of DC (Doctor
of Chiropractic) primarily engaged in the independent practice of
chiropractic. These practitioners provide diagnostic and therapeutic
treatment of neuromusculoskeletal and related disorders through the
manipulation and adjustment of the spinal column and extremities, and
operate private or group practices in their own offices (e.g., centers,
clinics) or in the facilities of others, such as hospitals or HMO
medical centers. The SBA has established a size standard for this
industry, which is annual receipts of $8 million or less. The 2012 U.S.
Economic Census statistics show that in 2012, 33,940 firms operated
throughout the entire year. Of that number 33,910 operated with annual
receipts of less than $5 million per year, while 26 firms had annual
receipts between $5 million and $9,999,999. Based on the data, the
Commission concludes that a majority of chiropractors are small.
Offices of Optometrists. This U.S. industry comprises
establishments of health practitioners having the degree of O.D.
(Doctor of Optometry) primarily engaged in the independent practice of
[[Page 17506]]
optometry. These practitioners examine, diagnose, treat, and manage
diseases and disorders of the visual system, the eye and associated
structures as well as diagnose related systemic conditions. Offices of
optometrists prescribe and/or provide eyeglasses, contact lenses, low
vision aids, and vision therapy. They operate private or group
practices in their own offices (e.g., centers, clinics) or in the
facilities of others, such as hospitals or HMO medical centers, and may
also provide the same services as opticians, such as selling and
fitting prescription eyeglasses and contact lenses. The SBA has
established a size standard for businesses operating in this industry,
which is annual receipts of $8 million or less. The 2012 Economic
Census indicates that 18,050 firms operated the entire year. Of that
number, 17,951 had annual receipts of less than $5 million, while 70
firms had annual receipts between $5 million and $9,999,999. Based on
the data, the Commission concludes that a majority of optometrists in
this industry are small.
Offices of Mental Health Practitioners (except Physicians). This
U.S. industry comprises establishments of independent mental health
practitioners (except physicians) primarily engaged in (1) the
diagnosis and treatment of mental, emotional, and behavioral disorders
and/or (2) the diagnosis and treatment of individual or group social
dysfunction brought about by such causes as mental illness, alcohol and
substance abuse, physical and emotional trauma, or stress. These
practitioners operate private or group practices in their own offices
(e.g., centers, clinics) or in the facilities of others, such as
hospitals or HMO medical centers. The SBA has created a size standard
for this industry, which is annual receipts of $8 million or less. The
2012 U.S. Economic Census indicates that 16,058 firms operated
throughout the entire year. Of that number, 15,894 firms received
annual receipts of less than $5 million, while 111 firms had annual
receipts between $5 million and $9,999,999. Based on the data, the
Commission concludes that a majority of mental health practitioners who
do not employ physicians are small.
Offices of Physical, Occupational and Speech Therapists and
Audiologists. This U.S. industry comprises establishments of
independent health practitioners primarily engaged in one of the
following: (1) providing physical therapy services to patients who have
impairments, functional limitations, disabilities, or changes in
physical functions and health status resulting from injury, disease or
other causes, or who require prevention, wellness or fitness services;
(2) planning and administering educational, recreational, and social
activities designed to help patients or individuals with disabilities,
regain physical or mental functioning or to adapt to their
disabilities; and (3) diagnosing and treating speech, language, or
hearing problems. These practitioners operate private or group
practices in their own offices (e.g., centers, clinics) or in the
facilities of others, such as hospitals or HMO medical centers. The SBA
has established a size standard for this industry, which is annual
receipts of $8 million or less. The 2012 U.S. Economic Census indicates
that 20,567 firms in this industry operated throughout the entire year.
Of this number, 20,047 had annual receipts of less than $5 million,
while 270 firms had annual receipts between $5 million and $9,999,999.
Based on the data, the Commission concludes that a majority of
businesses in this industry are small.
Offices of Podiatrists. This U.S. industry comprises establishments
of health practitioners having the degree of D.P.M. (Doctor of
Podiatric Medicine) primarily engaged in the independent practice of
podiatry. These practitioners diagnose and treat diseases and
deformities of the foot and operate private or group practices in their
own offices (e.g., centers, clinics) or in the facilities of others,
such as hospitals or HMO medical centers. The SBA has established a
size standard for businesses in this industry, which is annual receipts
of $8 million or less. The 2012 U.S. Economic Census indicates that
7,569 podiatry firms operated throughout the entire year. Of that
number, 7,545 firms had annual receipts of less than $5 million, while
22 firms had annual receipts between $5 million and $9,999,999. Based
on the data, the Commission concludes that a majority of firms in this
industry are small.
Offices of All Other Miscellaneous Health Practitioners. This U.S.
industry comprises establishments of independent health practitioners
(except physicians; dentists; chiropractors; optometrists; mental
health specialists; physical, occupational, and speech therapists;
audiologists; and podiatrists). These practitioners operate private or
group practices in their own offices (e.g., centers, clinics) or in the
facilities of others, such as hospitals or HMO medical centers. The SBA
has established a size standard for this industry, which is annual
receipts of $8 million or less. The 2012 U.S. Economic Census indicates
that 11,460 firms operated throughout the entire year. Of that number,
11,374 firms had annual receipts of less than $5 million, while 48
firms had annual receipts between $5 million and $9,999,999. Based on
the data, the Commission concludes the majority of firms in this
industry are small.
Family Planning Centers. This U.S. industry comprises
establishments with medical staff primarily engaged in providing a
range of family planning services on an outpatient basis, such as
contraceptive services, genetic and prenatal counseling, voluntary
sterilization, and therapeutic and medically induced termination of
pregnancy. The SBA has established a size standard for this industry,
which is annual receipts of $12 million or less. The 2012 Economic
Census indicates that 1,286 firms in this industry operated throughout
the entire year. Of that number 1,237 had annual receipts of less than
$10 million, while 36 firms had annual receipts between $10 million and
$24,999,999. Based on the data, the Commission concludes that the
majority of firms in this industry is small.
Outpatient Mental Health and Substance Abuse Centers. This U.S.
industry comprises establishments with medical staff primarily engaged
in providing outpatient services related to the diagnosis and treatment
of mental health disorders and alcohol and other substance abuse. These
establishments generally treat patients who do not require inpatient
treatment. They may provide a counseling staff and information
regarding a wide range of mental health and substance abuse issues and/
or refer patients to more extensive treatment programs, if necessary.
The SBA has established a size standard for this industry, which is
$16.5 million or less in annual receipts. The 2012 U.S. Economic Census
indicates that 4,446 firms operated throughout the entire year. Of that
number, 4,069 had annual receipts of less than $10 million while 286
firms had annual receipts between $10 million and $24,999,999. Based on
the data, the Commission concludes that a majority of firms in this
industry are small.
HMO Medical Centers. This U.S. industry comprises establishments
with physicians and other medical staff primarily engaged in providing
a range of outpatient medical services to the health maintenance
organization (HMO) subscribers with a focus generally on primary health
care. These establishments are owned by the HMO. Included in this
industry are HMO
[[Page 17507]]
establishments that both provide health care services and underwrite
health and medical insurance policies. The SBA has established a size
standard for this industry, which is $35 million or less in annual
receipts. The 2012 U.S. Economic Census indicates that 14 firms in this
industry operated throughout the entire year. Of that number, 5 firms
had annual receipts of less than $25 million, while 1 firm had annual
receipts between $25 million and $99,999,999. Based on the data, the
Commission concludes that approximately one-third of the firms in this
industry are small.
Freestanding Ambulatory Surgical and Emergency Centers. This U.S.
industry comprises establishments with physicians and other medical
staff primarily engaged in (1) providing surgical services (e.g.,
orthoscopic and cataract surgery) on an outpatient basis or (2)
providing emergency care services (e.g., setting broken bones, treating
lacerations, or tending to patients suffering injuries as a result of
accidents, trauma, or medical conditions necessitating immediate
medical care) on an outpatient basis. Outpatient surgical
establishments have specialized facilities, such as operating and
recovery rooms, and specialized equipment, such as anesthetic or X-ray
equipment. The SBA has established a size standard for this industry,
which is annual receipts of $16.5 million or less. The 2012 U.S.
Economic Census indicates that 3,595 firms in this industry operated
throughout the entire year. Of that number, 3,222 firms had annual
receipts of less than $10 million, while 289 firms had annual receipts
between $10 million and $24,999,999. Based on the data, the Commission
concludes that a majority of firms in this industry are small.
All Other Outpatient Care Centers. This U.S. industry comprises
establishments with medical staff primarily engaged in providing
general or specialized outpatient care (except family planning centers,
outpatient mental health and substance abuse centers, HMO medical
centers, kidney dialysis centers, and freestanding ambulatory surgical
and emergency centers). Centers or clinics of health practitioners with
different degrees from more than one industry practicing within the
same establishment (i.e., Doctor of Medicine and Doctor of Dental
Medicine) are included in this industry. The SBA has established a size
standard for this industry, which is annual receipts of $22 million or
less. The 2012 U.S. Economic Census indicates that 4,903 firms operated
in this industry throughout the entire year. Of this number, 4,269
firms had annual receipts of less than $10 million, while 389 firms had
annual receipts between $10 million and $24,999,999. Based on the data,
the Commission concludes that a majority of firms in this industry are
small.
Blood and Organ Banks. This U.S. industry comprises establishments
primarily engaged in collecting, storing, and distributing blood and
blood products and storing and distributing body organs. The SBA has
established a size standard for this industry, which is annual receipts
of $35 million or less. The 2012 U.S. Economic Census indicates that
314 firms operated in this industry throughout the entire year. Of that
number, 235 operated with annual receipts of less than $25 million,
while 41 firms had annual receipts between $25 million and $49,999,999.
Based on the data, the Commission concludes that approximately three-
quarters of firms that operate in this industry are small.
All Other Miscellaneous Ambulatory Health Care Services. This U.S.
industry comprises establishments primarily engaged in providing
ambulatory health care services (except offices of physicians,
dentists, and other health practitioners; outpatient care centers;
medical and diagnostic laboratories; home health care providers;
ambulances; and blood and organ banks). The SBA has established a size
standard for this industry, which is annual receipts of $16.5 million
or less. The 2012 U.S. Economic Census indicates that 2,429 firms
operated in this industry throughout the entire year. Of that number,
2,318 had annual receipts of less than $10 million, while 56 firms had
annual receipts between $10 million and $24,999,999. Based on the data,
the Commission concludes that a majority of the firms in this industry
is small.
Medical Laboratories. This U.S. industry comprises establishments
known as medical laboratories primarily engaged in providing analytic
or diagnostic services, including body fluid analysis, generally to the
medical profession or to the patient on referral from a health
practitioner. The SBA has established a size standard for this
industry, which is annual receipts of $35 million or less. The 2012
U.S. Economic Census indicates that 2,599 firms operated in this
industry throughout the entire year. Of this number, 2,465 had annual
receipts of less than $25 million, while 60 firms had annual receipts
between $25 million and $49,999,999. Based on the data, the Commission
concludes that a majority of firms that operate in this industry are
small.
Diagnostic Imaging Centers. This U.S. industry comprises
establishments known as diagnostic imaging centers primarily engaged in
producing images of the patient generally on referral from a health
practitioner. The SBA has established size standard for this industry,
which is annual receipts of $16.5 million or less. The 2012 U.S.
Economic Census indicates that 4,209 firms operated in this industry
throughout the entire year. Of that number, 3,876 firms had annual
receipts of less than $10 million, while 228 firms had annual receipts
between $10 million and $24,999,999. Based on the data, the Commission
concludes that a majority of firms that operate in this industry are
small.
Home Health Care Services. This U.S. industry comprises
establishments primarily engaged in providing skilled nursing services
in the home, along with a range of the following: personal care
services; homemaker and companion services; physical therapy; medical
social services; medications; medical equipment and supplies;
counseling; 24-hour home care; occupation and vocational therapy;
dietary and nutritional services; speech therapy; audiology; and high-
tech care, such as intravenous therapy. The SBA has established a size
standard for this industry, which is annual receipts of $16.5 million
or less. The 2012 U.S. Economic Census indicates that 17,770 firms
operated in this industry throughout the entire year. Of that number,
16,822 had annual receipts of less than $10 million, while 590 firms
had annual receipts between $10 million and $24,999,999. Based on the
data, the Commission concludes that a majority of firms that operate in
this industry are small.
Ambulance Services. This U.S. industry comprises establishments
primarily engaged in providing transportation of patients by ground or
air, along with medical care. These services are often provided during
a medical emergency but are not restricted to emergencies. The vehicles
are equipped with lifesaving equipment operated by medically trained
personnel. The SBA has established a size standard for this industry,
which is annual receipts of $16.5 million or less. The 2012 U.S.
Economic Census indicates that 2,984 firms operated in this industry
throughout the entire year. Of that number, 2,926 had annual receipts
of less than $15 million, while 133 firms had annual receipts between
$10 million and $24,999,999. Based on the data, the Commission
concludes that a majority of firms in this industry is small.
[[Page 17508]]
Kidney Dialysis Centers. This U.S. industry comprises
establishments with medical staff primarily engaged in providing
outpatient kidney or renal dialysis services. The SBA has established
assize standard for this industry, which is annual receipts of $41.5
million or less. The 2012 U.S. Economic Census indicates that 396 firms
operated in this industry throughout the entire year. Of that number,
379 had annual receipts of less than $25 million, while 7 firms had
annual receipts between $25 million and $49,999,999. Based on the data,
the Commission concludes that a majority of firms in this industry are
small.
General Medical and Surgical Hospitals. This U.S. industry
comprises establishments known and licensed as general medical and
surgical hospitals primarily engaged in providing diagnostic and
medical treatment (both surgical and nonsurgical) to inpatients with
any of a wide variety of medical conditions. These establishments
maintain inpatient beds and provide patients with food services that
meet their nutritional requirements. These hospitals have an organized
staff of physicians and other medical staff to provide patient care
services. These establishments usually provide other services, such as
outpatient services, anatomical pathology services, diagnostic X-ray
services, clinical laboratory services, operating room services for a
variety of procedures, and pharmacy services. The SBA has established a
size standard for this industry, which is annual receipts of $41.5
million or less. The 2012 U.S. Economic Census indicates that 2,800
firms operated in this industry throughout the entire year. Of that
number, 877 has annual receipts of less than $25 million, while 400
firms had annual receipts between $25 million and $49,999,999. Based on
the data, the Commission concludes that approximately one-quarter of
firms in this industry are small.
Psychiatric and Substance Abuse Hospitals. This U.S. industry
comprises establishments known and licensed as psychiatric and
substance abuse hospitals primarily engaged in providing diagnostic,
medical treatment, and monitoring services for inpatients who suffer
from mental illness or substance abuse disorders. The treatment often
requires an extended stay in the hospital. These establishments
maintain inpatient beds and provide patients with food services that
meet their nutritional requirements. They have an organized staff of
physicians and other medical staff to provide patient care services.
Psychiatric, psychological, and social work services are available at
the facility. These hospitals usually provide other services, such as
outpatient services, clinical laboratory services, diagnostic X-ray
services, and electroencephalograph services. The SBA has established a
size standard for this industry, which is annual receipts of $41.5
million or less. The 2012 U.S. Economic Census indicates that 404 firms
operated in this industry throughout the entire year. Of that number,
185 had annual receipts of less than $25 million, while 107 firms had
annual receipts between $25 million and $49,999,999. Based on the data,
the Commission concludes that more than one-half of the firms in this
industry are small.
Specialty (Except Psychiatric and Substance Abuse) Hospitals. This
U.S. industry consists of establishments known and licensed as
specialty hospitals primarily engaged in providing diagnostic, and
medical treatment to inpatients with a specific type of disease or
medical condition (except psychiatric or substance abuse). Hospitals
providing long-term care for the chronically ill and hospitals
providing rehabilitation, restorative, and adjustive services to
physically challenged or disabled people are included in this industry.
These establishments maintain inpatient beds and provide patients with
food services that meet their nutritional requirements. They have an
organized staff of physicians and other medical staff to provide
patient care services. These hospitals may provide other services, such
as outpatient services, diagnostic X-ray services, clinical laboratory
services, operating room services, physical therapy services,
educational and vocational services, and psychological and social work
services. The SBA has established a size standard for this industry,
which is annual receipts of $41.5 million or less. The 2012 U.S.
Economic Census indicates that 346 firms operated in this industry
throughout the entire year. Of that number, 146 firms had annual
receipts of less than $25 million, while 79 firms had annual receipts
between $25 million and $49,999,999. Based on the data, the Commission
concludes that more than one-half of the firms in this industry are
small.
Emergency and Other Relief Services. This industry comprises
establishments primarily engaged in providing food, shelter, clothing,
medical relief, resettlement, and counseling to victims of domestic or
international disasters or conflicts (e.g., wars). The SBA has
established a size standard for this industry which is annual receipts
of $35 million or less. The 2012 U.S. Economic Census indicates that
541 firms operated in this industry throughout the entire year. Of that
number, 509 had annual receipts of less than $25 million, while 7 firms
had annual receipts between $25 million and $49,999,999. Based on the
data, the Commission concludes that a majority of firms in this
industry are small.
Providers of Telecommunications and Other Services
Telecommunications Service Providers--Incumbent Local Exchange
Carriers (LECs). Neither the Commission nor the SBA has developed a
small business size standard specifically for incumbent local exchange
services. The closest applicable NAICS Code category is Wired
Telecommunications Carriers. Under the applicable SBA size standard,
such a business is small if it has 1,500 or fewer employees. U.S.
Census Bureau data for 2012 indicate that 3,117 firms operated the
entire year. Of this total, 3,083 operated with fewer than 1,000
employees. Consequently, the Commission estimates that most providers
of incumbent local exchange service are small businesses that may be
affected by the actions. According to Commission data, one thousand
three hundred and seven (1,307) Incumbent Local Exchange Carriers
reported that they were incumbent local exchange service providers. Of
this total, an estimated 1,006 have 1,500 or fewer employees. Thus,
using the SBA's size standard the majority of incumbent LECs can be
considered small entities.
Interexchange Carriers (IXCs). Neither the Commission nor the SBA
has developed a small business size standard specifically for
Interexchange Carriers. The closest applicable NAICS Code category is
Wired Telecommunications Carriers. The applicable size standard under
SBA rules is that such a business is small if it has 1,500 or fewer
employees. U.S. Census Bureau data for 2012 indicate that 3,117 firms
operated for the entire year. Of that number, 3,083 operated with fewer
than 1,000 employees. According to internally developed Commission
data, 359 companies reported that their primary telecommunications
service activity was the provision of interexchange services. Of this
total, an estimated 317 have 1,500 or fewer employees. Consequently,
the Commission estimates that the majority of interexchange service
providers are small entities.
Competitive Access Providers. Neither the Commission nor the SBA
[[Page 17509]]
has developed a definition of small entities specifically applicable to
competitive access services providers (CAPs). The closest applicable
definition under the SBA rules is Wired Telecommunications Carriers and
under the size standard, such a business is small if it has 1,500 or
fewer employees. U.S. Census Bureau data for 2012 indicates that 3,117
firms operated during that year. Of that number, 3,083 operated with
fewer than 1,000 employees. Consequently, the Commission estimates that
most competitive access providers are small businesses that may be
affected by the actions. According to Commission data the 2010 Trends
in Telephone Report (rel. September 30, 2010), 1,442 CAPs and
competitive local exchange carriers (competitive LECs) reported that
they were engaged in the provision of competitive local exchange
services. Of these 1,442 CAPs and competitive LECs, an estimated 1,256
have 1,500 or few employees and 186 have more than 1,500 employees.
Consequently, the Commission estimates that most providers of
competitive exchange services are small businesses.
Wireline Providers, Wireless Carriers and Service Providers, and
internet Service Providers. The small entities that may be affected by
the reforms include eligible nonprofit and public health care providers
and the eligible service providers offering them services, including
telecommunications service providers, internet Service Providers, and
service providers of the services and equipment used for dedicated
broadband networks.
Vendors and Equipment Manufactures--Vendors of Infrastructure
Development or ``Network Buildout.'' The Commission has not developed a
small business size standard specifically directed toward manufacturers
of network facilities. There are two applicable SBA categories in which
manufacturers of network facilities could fall and each have different
size standards under the SBA rules. The SBA categories are ``Radio and
Television Broadcasting and Wireless Communications Equipment'' with a
size standard of 1,250 employees or less and ``Other Communications
Equipment Manufacturing'' with a size standard of 750 employees or
less.'' U.S. Census Bureau data for 2012 shows that for Radio and
Television Broadcasting and Wireless Communications Equipment firms 841
establishments operated for the entire year. Of that number, 828
establishments operated with fewer than 1,000 employees, and 7
establishments operated with between 1,000 and 2,499 employees. For
Other Communications Equipment Manufacturing, U.S. Census Bureau data
for 2012, show that 383 establishments operated for the year. Of that
number 379 operated with fewer than 500 employees and 4 had 500 to 999
employees. Based on the data, the Commission concludes that the
majority of Vendors of Infrastructure Development or ``Network
Buildout'' are small.
Telephone Apparatus Manufacturing. This industry comprises
establishments primarily engaged in manufacturing wire telephone and
data communications equipment. These products may be stand-alone or
board-level components of a larger system. Examples of products made by
these establishments are central office switching equipment, cordless
and wire telephones (except cellular), PBX equipment, telephone
answering machines, LAN modems, multi-user modems, and other data
communications equipment, such as bridges, routers, and gateways. The
SBA has developed a small business size standard for Telephone
Apparatus Manufacturing, which consists of all such companies having
1,250 or fewer employees. U.S. Census Bureau data for 2012 show that
there were 266 establishments that operated that year. Of this total,
262 operated with fewer than 1,000 employees. Thus, under the size
standard, the majority of firms in this industry can be considered
small.
Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing. This industry comprises establishments
primarily engaged in manufacturing radio and television broadcast and
wireless communications equipment. Examples of products made by these
establishments are: transmitting and receiving antennas, cable
television equipment, GPS equipment, pagers, cellular phones, mobile
communications equipment, and radio and television studio and
broadcasting equipment. The SBA has established a small business size
standard for this industry of 1,250 or fewer employees. U.S. Census
Bureau data for 2012 show that 841 establishments operated in this
industry in that year. Of that number, 828 establishments operated with
fewer than 1,000 employees, 7 establishments operated with between
1,000 and 2,499 employees and 6 establishments operated with 2,500 or
more employees. Based on the data, the Commission concludes that a
majority of manufacturers in this industry are small.
Other Communications Equipment Manufacturing. This industry
comprises establishments primarily engaged in manufacturing
communications equipment (except telephone apparatus, and radio and
television broadcast, and wireless communications equipment). Examples
of such manufacturing include fire detection and alarm systems
manufacturing, Intercom systems and equipment manufacturing, and
signals (e.g., highway, pedestrian, railway, traffic) manufacturing.
The SBA has established a size standard for this industry as all such
firms having 750 or fewer employees. U.S. Census Bureau data for 2012
shows that 383 establishments operated in that year. Of that number,
379 operated with fewer than 500 employees and 4 had 500 to 999
employees. Based on the data, the Commission concludes that the
majority of Other Communications Equipment Manufacturers are small.
Steps Taken To Minimize the Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
The RFA requires an agency to describe any significant,
specifically small business, alternatives that it has considered in
reaching its proposed approach, which may include the following four
alternatives (among others): ``(1) the establishment of differing
compliance or reporting requirements or timetables that take into
account the resources available to small entities; (2) the
clarification, consolidation, or simplification of compliance and
reporting requirements under the rule for such small entities; (3) the
use of performance rather than design standards; and (4) an exemption
from coverage of the rule, or any part thereof, for such small
entities.'' We expect to consider all of these factors when we have
received substantive comment from the public and potentially affected
entities.
Largely, the proposals in the Second FNPRM if adopted would have no
impact on or would reduce the economic impact of current regulations on
small entities. Certain proposals could have a positive economic impact
on small entities. In the instances in which a proposed change would
increase the financial burden on small entities, the Commission has
determined that the net financial and other benefits from such changes
would outweigh the increased burdens on small entities.
Determining Accurate Rates in the Telecom Program. The Commission
proposes modifications to the three rural rate determination methods in
the Telecom Program, including changes to the market-based approach of
Methods
[[Page 17510]]
1 and 2 and new evidentiary requirements for justifying cost-based
rates under Method 3. The Commission also proposes that participants
with multi-year contracts and evergreen contracts would only have to
justify rural rates in the first year of the contract. The Commission
also proposes to simplify the calculation of urban rate rules by
eliminating the ``standard urban distance'' requirement and seek
specific comment on sources of urban rates as well as general comment
on the urban rate rules. The Commission proposes to keep the cap on
support for satellite services reinstated and seek comment on potential
changes to it. Lastly, the Commission seeks comment on proposed
revisions to FCC Form 466 intended to improve the quality of Telecom
Program data.
Administrative Deadlines. The Commission also proposes to amend
program rules align the deadline for filing a SPIN change with the
invoice deadline. If implemented, the proposal would have a positive
impact on small health care providers because it would reduce the need
for them to seek waivers of the current SPIN change deadline. The
Commission also seeks comment on whether a mechanism to allow post-
commitment changes to evergreen contract dates is necessary.
Future Eligibility. The Commission also proposes a mechanism
whereby entities that are not yet eligible health care providers can
engage in competitive bidding and file requests for funding, which
would allow them to receive RHC Program funding shortly after they
become eligible. If implemented, the proposal would have a positive
economic impact on small health care providers because it would allow
them to receive RHC Program funding shortly after they become eligible.
Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
None.
Ordering Clauses
Accordingly, it is ordered, pursuant to the authority contained in
sections 1, 4(j), 214, 254, and 405 of the Communications Act of 1934,
as amended, 47 U.S.C. 151, 154(j), 214, 254, and 405 and Sec. Sec.
1.115 and 1.429 of the Commission's rules, 47 CFR 1.115, 1.429, that
the Second FNPRM is adopted.
It is further ordered that, pursuant to applicable procedures set
forth in Sec. Sec. 1.415 and 1.419 of the Commission's rules, 47 CFR
1.415, 1.419, interested parties may file comments on the Second FNPRM
on or before April 24, 2023, and reply comments on or before May 22,
2023.
List of Subjects in 47 CFR Part 54
Communications common carriers, Health facilities, internet,
Reporting and recordkeeping requirements, Telecommunications.
Federal Communications Commission.
Marlene Dortch,
Secretary.
Proposed Rules
For the reasons discussed in the preamble, the Federal
Communications Commission proposes to amend 47 CFR part 54 as follows:
PART 54--UNIVERSAL SERVICE
0
1. The authority citation for part 54 continues to read as follows:
Authority: 47 U.S.C. 151, 154(i), 155, 201, 205, 214, 219, 220,
229, 254, 303(r), 403, 1004, 1302, 1601-1609, and 1752, unless
otherwise noted.
0
2. Amend Sec. 54.601 by adding paragraph (c) to read as follows:
Sec. 54.601 Health care provider eligibility.
* * * * *
(c) Conditional approval of eligibility. (1) An entity that is not
a public or non-profit health care provider may request and receive a
conditional approval of eligibility from the Administrator if the
entity satisfies the following requirements:
(i) The entity is or will be physically located in a rural area
defined in Sec. 54.600(e) by an estimated eligibility date or, for the
HCF Program only, is not located in a rural area but is or will be a
member of a majority-rural Healthcare Connect Fund Program consortium
that satisfies the eligible rural health care provider composition
requirement set forth in Sec. 54.607(b) by the estimated eligibility
date;
(ii) The entity must provide documentation showing that it will
qualify as a public or non-profit health care provider as defined in
Sec. 54.600(b) by the estimated eligibility date; and
(iii) The estimated eligibility date must be in the same funding
year as or in the next funding year of the date that the entity
requests the conditional approval of eligibility.
(2) An entity that receives conditional approval of eligibility may
conduct competitive bidding for the site. An entity engaging in
competitive bidding with conditional approval of eligibility must
provide a written notification to potential bidders that the entity's
eligibility is conditional and specify the estimated eligibility date.
(3) An entity that receives conditional approval of eligibility may
file a request for funding for the site during an application filing
window opened for a funding year that ends after the estimated
eligibility date. The Administrator shall not issue any funding
commitments to applicants that have received conditional approval of
eligibility only. Funding commitments may be issued only after such
applicants receive formal approval of eligibility as described in
paragraph (c)(4) of this section.
(4) An entity that receives conditional approval of eligibility is
expected to notify the Administrator, along with supporting
documentation for the eligibility, within 30 days of its actual
eligibility date. The actual eligibility date is the date that the
entity qualifies as a public or non-profit health care provider as
defined in Sec. 54.600(b) and may be a different date from the
estimated eligibility date. The Administrator shall formally approve
the entity's eligibility if the entity meets the requirements for a
public or non-profit health care provider defined in Sec. 54.600(b),
provided that the entity still satisfies the requirement under
paragraph (c)(1)(i) of this section. Upon the entity receiving a formal
approval of eligibility, the Administrator may issue funding
commitments covering a time period that starts no earlier than the
entity's actual eligibility date and that is within the funding year
for which support was requested.
0
3. Revise Sec. 54.604 to read as follows:
Sec. 54.604 Determining the urban rate.
If a rural health care provider requests support for an eligible
service to be funded from the Telecommunications Program the ``urban
rate'' for that service shall be a rate no higher than the highest
tariffed or publicly-available rate charged to a commercial customer
for a functionally similar service in any city with a population of
50,000 or more in that state, calculated as if it were provided between
two points within the city.
0
4. Revise Sec. 54.605 to read as follows:
Sec. 54.605 Determining the rural rate.
(a) The rural rate shall be used as described in this subpart to
determine the credit or reimbursement due to a telecommunications
carrier that provides eligible telecommunications services to eligible
health care providers.
(1) The rural rate shall be the median of publicly available rates
charged by other service providers for the same or functionally similar
services over the same distance in the rural area where
[[Page 17511]]
the health care provider is located (Method A).
(2) If there are no publicly available rates charged by other
service providers for the same or functionally similar services, the
rural rate shall be the median of the rates that the carrier actually
charges to non-health care provider commercial customers for the same
or functionally similar services provided in the rural area where the
health care provider is located (Method B).
(3) If the telecommunications carrier serving the health care
provider is not providing any identical or similar services in the
rural area or it reasonably determines that the rural rate calculated
under paragraph (a)(1) or (2) of this section would not generate a
reasonably compensatory rate, then the carrier shall submit to a state
commission, for intrastate rates, or the Commission, for interstate
rates, a cost-based rate for the provision of the service.
(i) The carrier must provide to the state commission, for
intrastate rates, or the Commission, for interstate rates, a
justification of the proposed rural rate, which must include all
financial data and other information to verify the service provider's
assertions, including at a minimum, the following information:
(A) Company-wide and rural health care service gross investment,
accumulated depreciation, deferred state and Federal income taxes, and
net investment; capital costs by category expressed as annual figures
(e.g., depreciation expense, state and Federal income tax expense,
return on net investment); operating expenses by category (e.g.,
maintenance expense, administrative and other overhead expenses, and
tax expense other than income tax expense); the applicable state and
Federal income tax rates; fixed charges (e.g., interest expense); and
any income tax adjustments;
(B) An explanation and a set of detailed spreadsheets showing the
direct assignment of costs to the rural health care service and how
company-wide common costs are allocated among the company's services,
including the rural health care service, and the result of these direct
assignments and allocations as necessary to develop a rate for the
rural health care service;
(C) The company-wide and rural health care service costs for the
most recent calendar year for which full-time actual, historical cost
data are available;
(D) Projections of the company-wide and rural health care service
costs for the funding year in question and an explanation of those
projections;
(E) Actual monthly demand data for the rural health care service
for the most recent three calendar years (if applicable);
(F) Projections of the monthly demand for the rural health care
service for the funding year in question, and the data and details on
the methodology used to make those projections;
(G) The annual revenue requirement (capital costs and operating
expenses expressed as an annual number plus a return on net investment)
and the rate for the funded service (annual revenue requirement divided
by annual demand divided by twelve equals the monthly rate for the
service), assuming one rate element for the service), based on the
projected rural health care service costs and demands;
(H) Audited financial statements and notes to the financial
statements, if available, and otherwise unaudited financial statements
for the most recent three fiscal years, specifically, the cash flow
statement, income statement, and balance sheets. Such statements shall
include information regarding costs and revenues associated with, or
used as a starting point to develop, the rural health care service
rate; and
(I) Density characteristics of the rural area or other relevant
geographical areas including square miles, road miles, mountains,
bodies of water, lack of roads, remoteness, challenges and costs
associated with transporting fuel, satellite and backhaul availability,
extreme weather conditions, challenging topography, short construction
season or any other characteristics that contribute to the high cost of
servicing the health care providers.
(ii) [Reserved]
(4) The carrier must provide such information periodically
thereafter as required by the state commission, for intrastate rates,
or the Commission, for interstate rates. In doing so, the carrier must
take into account anticipated and actual demand for telecommunications
services by all customers who will use the facilities over which
services are being provided to eligible health care providers.
(b) The rural rate shall not exceed the monthly rate in the service
agreement that the health care provider enters into with the service
provider when requesting funding.
(c) Service providers engaged in multi-year or evergreen contracts
are required to justify the rural rate only in the first year of the
contract.
0
5. Amend Sec. 54.622 by revising paragraph (e)(1)(i) to read as
follows:
Sec. 54.622 Competitive bidding requirements and exemptions.
* * * * *
(e) * * *
(1) * * *
(i) The entity seeking supported services is a public or nonprofit
health care provider that falls within one of the categories set forth
in the definition of health care provider listed in Sec. 54.600, or
will be such a public or nonprofit health care provider before the end
of the funding year for which the supported services are requested
provided that the entity is requesting or has received a conditional
approval of eligibility pursuant to Sec. 54.601(c);
* * * * *
0
6. Amend Sec. 54.625 by revising paragraph (c) to read as follows:
Sec. 54.625 Service Provider Identification Number (SPIN) changes.
* * * * *
(c) Filing deadline. An applicant must file its request for a
corrective or operational SPIN change with the Administrator no later
than the invoice filing deadline as defined by Sec. 54.627.
[FR Doc. 2023-04990 Filed 3-22-23; 8:45 am]
BILLING CODE 6712-01-P
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