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Update on the FCC’s Rural Health Care Program

Federal Communications CommissionState and Local Government Webinar

September 27, 2012

Chin YooAttorney Advisor, Wireline Competition Bureau,

Telecommunications Access Policy Division

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Health Care in the News

• How to improve quality of care?• How to save on costs?

IOM Report: “Best Care at Lower Cost”

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Health Care & Broadband, Part I(Electronic Health Records)

• HITECH Act: Incentives for physicians and hospitals to achieve “meaningful use” of electronic health records

• IOM: 20% patients reported that test results or medical records not transferred in time for appointment

• “Phase 2” Meaningful Use: ability to exchange these records with others

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Health Care & Broadband, Part II(Telemedicine)

• Iowa: The Iowa Health System transmits high resolution images via tele-radiology, which has improved diagnoses and has enabled more patients to stay at local hospitals.

• South Carolina: Palmetto State Providers Network uses tele-OB/GYN services to treat high-risk expectant mothers, saving both doctors and patients travel time and reducing the patient no-show rate.

• South Dakota: Heartland Unified Broadband Network (HUBNet) members use E-emergency, E-ICU, and E-Pharmacy programs to bring specialist care to remote areas.

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Overview of FCC RHC Discounts

Services Supported Discount Rate

Telecommunications Services Urban-rural differential

Internet Access Services 25 percent*

Deployment of statewide or regional health care broadband networks for rural and urban providers (infrastructure, services, equipment)

85 percent

“Primary” Program: Telecom Services

“Primary” Program: Internet Access

PilotProgram

* 50 percent for entirely rural states and territories (American Samoa, U.S. Virgin Islands, Northern Mariana Islands, and Guam qualify)

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Eligible Health Care Providers“Public” or “Nonprofit” (includes government health care providers)

Rural only• Includes circuits to urban if one side is rural• Eligibility lookup tool:

http://www.universalservice.org/rhc/tools/Rural/2005/search.asp• Reform rulemaking – open issue on urban eligibility

7 Eligible Provider Types• Local health departments or

agencies• Community or migrant health

centers • Community mental health

centers• Rural health clinics

• Not-for-profit hospitals• Post-secondary educational

institutions offering health care instruction, teaching hospitals, and medical schools

• Consortia of one or more of the above

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Applying to the Primary Program

The Universal Service Administrative Company (USAC) administers the program under direction from the FCC.• http://www.universalservice.org/rhc/Getting Started:• http://www.universalservice.org/rhc/about/getting-started/default.aspxWelcome Packet:•http://www.universalservice.org/_res/documents/rhc/pdf/handouts/RHC-Welcome-Packet.pdf

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Pilot Program Fostered Creation of Health Care Networks

http://www.fcc.gov/maps/rural-health-care-pilot-program

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Pilot Program: Summary of Key Benefits and Lessons Learned

Pilot-funded networks improve the quality and reduce the cost of health care in rural areas.

Consortium applications lower broadband costs through bulk buying and create administrative efficiencies.

Most health care providers (HCPs) prefer to use third-party networks rather than construct their own.

Urban HCPs in networks provide medical and technical expertise, leadership, and administrative support to rural sites.

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Trends Pilot Program Examples

Reduced time to treatment

Lives saved

Bacon County Hospital (GA): Connection to specialists allowed rapid administration of drug to save stroke patient’s life

TelemedicineSavings to taxpayers

Palmetto State (SC): Tele-psychiatry saved Medicaid program $18 million

Remote consults

Reduced transport costs

Barton Health (CA): Patients save almost $30,000/month in travel costs due to remote consults

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Health Care & Broadband, Part II(Telemedicine)

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Pilot Program Findings: Bulk Buying Enables Lower Rates, Higher Bandwidth, and

Better Service Quality

Pilot Program

Primary Program

Individual Competitive

Bidding

Bulk buying power

• Only 16 percent of funding requests receive bids at all

• 94 percent of projects had more than one vendor bid

• Over 120 vendors have been selected to provide services in Pilot Program

Consortium-led Competitive

Bidding

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0

500

1000

1500

2000

2500

3000

3500

4000

0

100

200

300

400

500

600

700

1.5 to <3 3 to <6 6 to <10 10 to <25 25 to <100 100+

Bandwidth (Mbps)

# of

HCP

s#

of C

ircui

ts

Primary Program

PilotProgram 0

1000

2000

3000

4000

5000

6000

1.5 to <3 3 to <6 6 to <10 10 to <25 25 to <100 100+

Cost

($)

Bandwidth (Mbps)

Primary

Pilot

Bandwidth Usage in Primary and Pilot Programs

Avg Total Monthly Recurring Costs – Primary and Pilot Program

Participants

Pilot Program Findings: Participation by Urban Providers Yields Benefits

Health Care Administrative Technical• Access to

specialists• Cost savings from

telemedicine• Training of health

care personnel in rural areas

• Leadership of consortia

• Sources of technical expertise

• Financial resources

• Efficiency of network design

• Urban hubs, rural spokes

DRAFT FOR REVIEW

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Reform of Rural Health Care Program

• The FCC issued a Notice of Proposed Rulemaking in 2010 proposing to reform its Rural Health Care Program.

• In the Notice, the FCC proposed two separate programs: a Health Infrastructure Program and a Broadband Services Program.

• The FCC recognized the value of gaining experience from the Pilot Program in shaping a reformed permanent Rural Health Care Program.

• The FCC expects to adopt its reformed program by the end of 2012.

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For Further Information:

At the FCC (Policy Questions)

Chin YooAttorney-AdvisorTelecommunications Access Policy DivisionWireline Competition Bureau

(202) 418-0295Chin.Yoo@fcc.gov

www.fcc.gov

At USAC (Application Questions)

Paloma CostaProgram Manager of OutreachRural Health Care

(202) 772-6374pcosta@usac.org

www.usac.org/rhc