Wireline Competition Bureau Seeks Further Comment on Issues in the Rural Health Care Reform Proceeding, 43773-43780 [2012-18273]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 77, Number 144 (Thursday, July 26, 2012)]
[Proposed Rules]
[Pages 43773-43780]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-18273]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 54

[WC Docket No. 02-60; DA 12-1166]


Wireline Competition Bureau Seeks Further Comment on Issues in 
the Rural Health Care Reform Proceeding

AGENCY: Federal Communications Commission.

ACTION: Proposed rule; solicitation of comments.

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SUMMARY: In this document, the Wireline Competition Bureau (the Bureau) 
seeks to develop a more robust record in the pending Rural Health Care 
reform rulemaking proceeding, which will allow the Commission to craft 
an efficient permanent program that will help health care providers 
exploit the potential of broadband to make health care better, more 
widely available, and less expensive for patients in rural areas.

DATES: Comments are due on or before August 23, 2012. Reply comments 
are due on or before September 7, 2012.

ADDRESSES: Interested parties may file comments on or before August 23, 
2012 and reply comments on or before

[[Page 43774]]

September 7, 2012. Comments are to reference WC Docket No. 02-60 and DA 
12-1166 and may be filed using the Commission's Electronic Comment 
Filing System (ECFS). See Electronic Filing of Documents in Rulemaking 
Proceedings, 63 FR 24121 (1998).
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: https://fjallfoss.fcc.gov/ecfs2/.
     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing. If more than one docket 
or rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number.
     All hand-delivered or messenger-delivered paper filings 
for the Commission's Secretary must be delivered to FCC Headquarters at 
445 12th St. SW., Room TW-A325, Washington, DC 20554. The filing hours 
are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together 
with rubber bands or fasteners. Any envelopes and boxes must be 
disposed of before entering the building.
     Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail must be addressed to 445 12th Street SW., Washington DC 20554.
     People with Disabilities: To request materials in 
accessible formats for people with disabilities (braille, large print, 
electronic files, audio format), send an email to fcc504@fcc.gov or 
call the Consumer & Governmental Affairs Bureau at 202-418-0530 
(voice), 202-418-0432 (tty).

FOR FURTHER INFORMATION CONTACT: Chin Yoo, Telecommunications Access 
Policy Division, Wireline Competition Bureau at (202) 418-0295 or TTY 
(202) 418-0484. For detailed instructions for submitting comments and 
additional information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

SUPPLEMENTARY INFORMATION: This is a synopsis of the Wireline 
Competition Bureau's Public Notice in WC Docket No. 02-60; DA 12-1166, 
released July 19, 2012. The complete text of this document is available 
for inspection and copying during normal business hours in the FCC 
Reference Information Center, Portals II, 445 12th Street SW., Room CY-
A257, Washington, DC 20554. The document may also be purchased from the 
Commission's duplicating contractor, Best Copy and Printing, Inc., 445 
12th Street SW., Room CY-B402, Washington, DC 20554, telephone (800) 
378-3160 or (202) 863-2893, facsimile (202) 863-2898, or via the 
Internet at https://www.bcpiweb.com.
    1. In this document, the Wireline Competition Bureau seeks to 
develop a more robust record in the pending Rural Health Care reform 
rulemaking proceeding, particularly with regard to the proposed 
Broadband Services Program. The Commission's Rural Health Care Pilot 
Program has helped foster the creation and growth of numerous state and 
regional broadband networks of health care providers (HCPs) throughout 
the country. These Pilot project networks have enabled health care 
providers in rural areas to tap into the medical and technical 
expertise of other health care providers on their networks, using 
telemedicine and other telehealth applications to improve the quality 
and lower the cost of health care for their patients in rural areas. As 
the Commission moves forward with reform of the Rural Health Care (RHC) 
program, it can benefit greatly from the experience of the Pilot 
projects and the lessons learned in the Pilot Program. A more focused 
and comprehensive record will help the Commission craft an efficient 
permanent program that will help health care providers exploit the 
potential of broadband to make health care better, more widely 
available, and less expensive for patients in rural areas.
    2. In its March 16, 2010, Joint Statement on Broadband, the 
Commission said that ``ubiquitous and affordable broadband can unlock 
vast new opportunities for Americans, in communities large and small, 
with respect to * * * health care delivery.'' The National Broadband 
Plan issued that same day recommended, among other things, that the 
Commission reform its Rural Health Care program in two ways: (1) By 
replacing the existing Internet Access Fund with a Health Care 
Broadband Access Fund, and (2) by establishing a Health Care Broadband 
Infrastructure Fund to subsidize network deployment for HCPs where 
existing networks are insufficient. Later that year, the Commission 
issued a Notice of Proposed Rulemaking in this docket proposing, 
consistent with the National Broadband Plan recommendations, both a 
Health Infrastructure Program, which would support the construction of 
new broadband HCP networks in areas of the country where broadband is 
unavailable or insufficient, and a Health Broadband Services Program, 
which would support the monthly recurring costs of broadband services 
for rural HCPs.
    3. Since the Commission issued the NPRM in 2010, the rural health 
care Pilot projects have made additional progress toward full 
implementation of their health care broadband networks. Although the 
Commission allowed Pilot projects to receive support to construct and 
own broadband network facilities, many Pilot projects chose to lease 
broadband services from commercial service providers as a way to 
implement broadband networks connecting HCPs. Projects chose to lease 
services instead of building networks because HCPs did not want to own 
or manage the networks and could more easily obtain needed broadband 
without owning the facilities or incurring administrative and other 
costs associated with network ownership. In light of the number of 
successful projects that elected to lease services instead of 
constructing networks, this public notice focuses on deepening the 
record regarding the Commission's proposed Broadband Services Program 
and the participation by consortia, including Pilot projects, in such a 
program.
    4. In recent months, Commission staff has engaged in outreach calls 
and meetings with many Pilot projects, as well as with other entities 
knowledgeable about rural health care, telemedicine, and Health IT. 
Based on what we have learned from the Pilot projects, and in light of 
the comments and other information filed in this Docket, we have 
identified several areas relating to the Broadband Services Program 
proposed in the NPRM that would benefit from further development of the 
record: (1) Use of consortium applications; (2) inclusion of urban 
health care providers in funded consortia; (3) services and equipment 
to be supported; (4) use of competitive bidding processes and multi-
year contracts; and (5) broadband needs of rural health care providers. 
We are especially interested in obtaining input that reflects the 
experience of participants in the Commission's current Rural Health 
Care programs, particularly that of the Pilot Program participants. To 
the extent possible, parties should identify throughout their comments 
the particular public notice questions to which they are responding, by 
using the relevant section numbers and letters (for example, ``Section 
I.a.--Consortium application process'').

I. Consortia

    5. Section 254(h)(7)(B)(vii) of the Communications Act specifically 
authorizes funding for consortia of eligible health care providers.

[[Page 43775]]

Commenters suggest that the consortium approach has many benefits, 
especially for rural HCPs that have limited administrative, financial, 
and technical resources. Although a health care provider may apply for 
funding under the existing Rural Health Care telecommunications program 
or Internet access program (collectively, ``Primary Program'') as a 
member of a consortium, in practice consortium applicants in the 
Primary Program must still file a separate form for every HCP site, and 
thus the consortium process has not been as widely used in that program 
as it has in the Pilot Program.
    6. In the NPRM, the Commission recognized that many Pilot projects, 
which are consortia of HCPs, may wish to transition to the permanent 
Broadband Services Program, if adopted, and sought comment on that 
transition. We now seek to further develop the record on issues 
relating to the use of consortium applications in the proposed 
Broadband Services Program:
    a. Consortium application process. We seek comment on specific 
procedures for the application process for consortia in the proposed 
Broadband Services Program and ask commenters to focus on how to 
streamline the application process while protecting against waste, 
fraud and abuse. What specific information should the Commission 
require from the consortium leader regarding each consortium member on 
the application forms? Should letters of authorization (LOAs) from 
participating members of the consortium be required? If so, should LOAs 
be submitted at the request-for-funding-commitment stage (with the 
filing of the Form 466-A), rather than at the request-for-services 
stage (with the filing of the Form 465), as is now the case under the 
Pilot Program? Submitting the LOAs later in the process, with the Form 
466-A, would appear to be more administratively efficient for the 
consortium, because the consortium could wait until it had completed 
competitive bidding and knew the pricing before soliciting the LOAs. 
Before they know the pricing, health care providers are likely to be 
less certain about whether they will want to participate. This approach 
also would be administratively simpler for USAC, as USAC would only 
have to confirm eligibility for that smaller group of HCPs that already 
know the pricing and are therefore more sure that they want to 
participate. We also seek comment on the alternative of requiring HCP 
LOAs to be submitted at the earlier (Form 465) stage, as in the Pilot 
Program. Should the Commission require consortium applicants to provide 
details in the consortium's request for services (the Form 465) 
regarding the services to be purchased, such as the desired bandwidth, 
sites to be served, and general type of service, as is currently 
required in the Pilot Program? Should the Commission require the lead 
entity and selected vendor to certify that the support provided will be 
used only for eligible purposes, as it does in the Pilot Program in 
connection with Form 466-A? Should the Commission require applicants to 
submit a ``declaration of assistance,'' as is required with the Form 
465 in the Pilot Program? We encourage commenters to draw on their 
experience with the Pilot and Primary programs in supporting any 
recommendations for streamlined application procedures.
    b. Post-award reporting requirements. What is the least burdensome 
way to collect information necessary to evaluate compliance with the 
statute and other relevant regulations, and to monitor how funding is 
being used? Should the Commission require consortium applicants to 
submit Quarterly Reports, as in the Pilot Program? Would the same 
information that is required for single HCP applicants be required for 
each HCP in a consortium application, or should the Commission permit 
consortium applicants to submit a reduced amount of information for 
each HCP, as it did in the Pilot Program? We encourage commenters to 
draw on their experience with the Pilot and Primary Program in 
supporting any recommendations for streamlined reporting procedures.
    c. Site and service substitution. The Pilot Program permits site 
and service substitutions within a project in certain specified 
circumstances, in order to provide some amount of flexibility to 
project participants. Under the Pilot Program, a site or service 
substitution may be approved if (i) the substitution is determined to 
be provided for in the contract, be within the change clause, or 
constitute a minor modification, (ii) the site is an eligible health 
care provider or the service is an eligible service under the Pilot 
Program, (iii) the substitution does not violate any contract provision 
or state or local procurement laws, and (iv) the requested change is 
within the scope of the controlling FCC Form 465, including any 
applicable Request for Proposal. Should the Commission adopt a similar 
policy for consortia that participate in the Broadband Services 
Program, if adopted? Would any modifications to that policy be 
warranted for the Broadband Services Program?

II. Inclusion of Urban Sites in Consortia

    7. One of the benefits of facilitating the establishment and 
operation of health care networks that serve providers in rural America 
is improved access to specialized care that typically is more available 
in urban areas. Historically, support under the Primary Program has 
only been provided to health care providers that meet the rural health 
care mechanism's definition of ``rural.'' In the Pilot Program, 
however, the Commission permitted non-rural health care providers to 
participate as part of consortia that include health care providers 
serving rural areas.
    8. In response to the NPRM, a number of commenters and USAC 
identify many benefits from including public and not-for-profit urban 
(or ``non-rural'') health care providers in rural broadband health care 
networks. Urban providers have taken the lead in many of the Pilot 
projects, and commenters note that many urban HCPs also provide 
technical, financial, and administrative support that otherwise might 
be unavailable to rural HCPs. Commenters have also noted that urban 
locations typically have medical specialists and other resources that 
rural HCPs need to access, through telemedicine and other telehealth 
applications. To further develop the record in the rulemaking docket, 
we now seek more focused comment on issues relating to the 
participation of urban HCPs in consortia that serve rural health care 
needs as part of the Broadband Services Program, if adopted.
    a. Proportion of urban or rural sites in consortia. The 2007 Pilot 
Program Selection Order allowed urban HCPs to receive support under the 
Pilot Program as long as they were part of networks that had more than 
a de minimis number of rural HCPs on the network. If the Commission 
were to provide support for broadband services to urban HCPs that are 
members of consortia that serve rural areas, should it adopt specific 
rules to ensure that the major benefit of the program flows to rural 
HCPs and/or to rural patients? For example, should the Commission 
require that more than a de minimis number of rural HCPs be included in 
such consortia, as in the Pilot program, and if so, what specific 
metrics should be used to determine whether a sufficient number of 
rural HCPs are participating in the consortia? For instance, should the 
Commission specify a maximum percentage of urban sites within a 
consortium? USAC states that urban sites make up approximately 35 
percent of all HCP Pilot Program sites that received funding 
commitments as

[[Page 43776]]

of January 2012. Should the Commission adopt this or a different 
percentage as an upper limit on the proportion of urban HCP sites 
within the rural health care program overall or within a consortium?
    b. Limiting percentage of funding available to urban sites. In the 
alternative, should the Commission specify a maximum amount of funding 
that can be provided to urban sites within a consortium? USAC estimates 
that about 35 percent of committed funds have gone to urban HCPs in the 
Pilot Program (while noting that this figure probably overstates the 
true urban share). Given that the Commission has sought comment on how 
to transition Pilot Program participants into a reformed program, would 
adopting a requirement that urban sites receive no greater than 35 
percent of total funds per funding year be a workable and appropriate 
restriction? How would the existence of such limits on urban site 
funding or inclusion of urban sites affect the consortium planning 
process and the development and growth of consortia over time?
    c. Impact on Fund. To the extent commenters support a particular 
approach to limiting the participation of urban sites in consortia 
serving rural areas, they also should estimate the likely impact on the 
RHC funding mechanism if the Commission were to adopt their recommended 
approach. Commenters should provide data to support their estimates. We 
welcome detailed analysis on the impact on the Fund of any limits (or 
lack thereof) on urban HCP participation that the Commission may adopt 
or that parties may propose.
    d. Impact on network design. USAC notes that in the hub-and-spoke 
configuration common to Pilot projects, where a centralized or primary 
HCP serves as the main provider and is surrounded by several subsidiary 
providers, the hub is often an urban HCP. What impact would including 
(or excluding) urban sites from funding under the Broadband Services 
Program have on network design and efficiency, from both a cost 
perspective and a technological perspective? Would it be possible to 
limit funding for urban sites to recurring and non-recurring charges 
associated with equipment necessary to create hubs at urban HCP sites? 
Would such a limitation unnecessarily restrict participation by urban 
HCPs or otherwise limit the effectiveness of the program?
    e. Role of urban health care providers if not funded. There may be 
significant benefits to Pilot projects from having a project leader 
that handles administrative and other necessary tasks on behalf of the 
other project participants. If the Commission were to exclude urban 
sites that are part of consortia serving rural communities from 
receiving funding under the Broadband Services Program, would there be 
administrative benefits to allowing such urban providers still to serve 
as project leaders even though they do not receive any support? In 
response to the NPRM, some commenters and Pilot projects contend that 
without support from the RHC program, urban sites may be reluctant to 
participate in broadband networks with rural HCPs, which could 
undermine the ability of rural HCPs to interconnect with those urban 
sites and to draw on their technical and medical expertise. What 
incentives would urban providers have to participate as a project 
leader if they are unable to receive any support?
    f. Grandfathering of urban sites already participating in Pilot 
projects. If the Commission chooses not to provide funding to urban 
sites under the Broadband Services Program, or sets limits on such 
funding as discussed in paragraph (b) above, should the Commission 
nevertheless provide funding to urban sites that have received funding 
under existing Pilot projects? Should the Commission limit the funding 
to existing Pilot project urban sites only for so long as the urban 
site is a member of a consortium with rural HCPs?

III. Eligible Services and Equipment

    9. In the Pilot Program, the Commission allows health care 
providers to use ``any currently available technology'' in order to 
create networks. The Pilot Program funds both recurring costs and non-
recurring costs (NRCs) for dedicated broadband networks connecting HCPs 
in a state or region, including the cost of subscribing to commercial 
service providers' services. As noted above, although the Pilot Program 
permitted projects to construct and own broadband network facilities, 
many projects elected to lease broadband services (which mostly involve 
recurring costs) rather than constructing and owning the broadband 
facilities themselves. As of February 29, 2012, the Pilot Program had 
committed approximately $35 million for construction, $162 million for 
leased/tariffed facilities or services, and $19 million for network 
equipment (including engineering and installation). The projects 
choosing to lease services cite several reasons for that choice, 
including that the HCPs' core competencies does not include owning or 
managing communications networks, that the HCPs can obtain the needed 
broadband without owning the facilities themselves, and that the 
administrative and other costs associated with broadband network 
ownership are too great.
    10. For the Broadband Services Program, the NPRM proposed to fund 
``recurring monthly costs for any advanced telecommunications and 
information services that provide point-to-point connectivity, 
including Dedicated Internet Access.'' In light of the Pilot Program 
experience and the comments in the record, we seek more focused comment 
on questions related to this proposal.
    a. Point-to-point connectivity. Some commenters have raised 
concerns regarding the term ``point-to-point'' in the NPRM. We seek to 
further develop the record on the types of connectivity that should be 
eligible for support under the proposed Broadband Services Program. 
Health care networks and other enterprise customers use a wide variety 
of connectivity solutions which allow a variety of topologies (ring, 
mesh, hub-and-spoke, line, etc.) and technologies (MetroE, MPLS, 
Virtual Private Network, etc.) to meet their requirements. These 
solutions are ``point-to-point'' in the sense that they allow a 
facility to send or receive data to or from another facility, but they 
also provide additional capabilities--for example, the ability to 
connect to multiple facilities on the same network, and/or the ability 
to connect to another facility without needing a physically 
``dedicated'' circuit to that facility. Should the definition of 
services to be funded under the Broadband Services Program omit the 
phrase ``point-to-point''? We seek comment on whether the rules for the 
Broadband Services Program should enumerate a wide range of 
connectivity solutions such as those listed above, or should be more 
general, in recognition of the likely change and evolution of services 
utilized by health care providers that will occur over time. Should 
there be any distinction in the types of services that would be funded 
if the applicant is part of a consortium, as opposed to individual 
applicants?
    b. Eligible non-recurring costs (NRCs). For the Broadband Services 
Program, the Commission proposed in the NPRM to provide one-time 
support for 50 percent of reasonable and customary installation charges 
for broadband access and to provide support for the cost of leases of 
lit or dark fiber. The American Telemedicine Association has 
recommended that the Commission, at a minimum, support the costs of 
routers and bridges associated with the installation of broadband 
services to an

[[Page 43777]]

eligible health care provider, and that the Commission allow such 
providers to work together to purchase equipment through joint, 
cooperative bidding procedures in order to allow for more efficient 
purchasing of network equipment costs. USAC notes that the availability 
of funding for certain types of equipment in the Pilot Program 
(``servers, routers, firewalls, and switches'') facilitates the ability 
of health care providers to upgrade circuits or create private 
networks. We seek more focused comment on whether the NRCs eligible to 
receive support under the Broadband Services Program should include 
equipment to enable the formation of networks among consortium members, 
similar to the Pilot Program.
    c. Limited Funding for Construction of Facilities in Broadband 
Services Program. As noted above, most Pilot projects chose to lease 
services rather than to construct and own their own network facilities. 
Some Pilot projects nevertheless argue that they need the option of 
constructing their own facilities when no service provider is willing 
to construct broadband facilities and lease them to project 
participants, or when the bids a project receives for leased services 
are higher than the cost of construction. The NPRM proposed a Health 
Infrastructure Program that would fund the construction of dedicated 
broadband networks in areas where broadband is demonstrated to be 
unavailable, and would require HCPs to have an ownership interest in 
the network facilities funded by the program. The Broadband Services 
Program, in contrast, would provide funding only for broadband services 
and, as proposed, would not cover capital or infrastructure costs. We 
seek to further develop the record on whether it would be appropriate 
under the proposed Broadband Services Program, if adopted, to provide 
funding to recipients to construct and own network facilities under 
limited circumstances. Would it be appropriate, for instance, in a 
situation where the applicant could demonstrate that self-provisioning 
the last mile facility to connect to an existing health care network is 
more cost-effective than procuring that last mile connectivity from a 
commercial service provider? What requirements would need to be in 
place to ensure that construction and ownership is the most cost-
effective option? How would a health care provider or consortium make 
such a showing? Would it be necessary to wait until after the 
competitive bidding process is completed in order for an applicant to 
be able to make that showing? Are there other more preliminary 
milestones during the competitive bidding process after which an 
applicant could make a showing? If the Commission were to make this 
option available, should there be specific caps on funding available to 
construct HCP-owned facilities?
    d. Ineligible sites and treatment of shared services/costs. Section 
254(h)(3) of the Act and Sec.  54.671(a) of the Commission's rules 
restrict the resale of any services purchased pursuant to the rural 
health care support mechanism. In the Pilot Program, the Commission 
determined that, under this resale restriction, a selected participant 
could not sell network capacity that was supported by Pilot Program 
funding, but could share excess network capacity with an ineligible 
entity as long as the ineligible entity paid its ``fair share'' of 
network costs attributable to the portion of the network capacity used. 
In the Pilot Program, projects have allocated the cost of shared 
services and equipment among members (both eligible and ineligible 
HCPs) by taking into account a variety of healthcare-specific factors. 
We note that in the Pilot Program, projects submit information about 
sharing of services and costs among members with their requests for 
funding commitments, and that USAC reviews and approves those 
submissions.
    We seek comment on whether there is a need to adopt specific rules 
in the Broadband Services Program (if adopted), regarding the 
participation of ineligible HCP sites (e.g., for-profit rural health 
clinics or, if not included in the Broadband Services Program, urban 
HCPs) in consortia that receive funding for broadband services provided 
to eligible members. Even if not funded, there may be other health care 
and financial reasons why providers that are not funded through the 
program may wish to enter into cooperative arrangements with other 
providers that are funded, in order to create local and regional health 
care networks. By acting together, providers are more likely to receive 
lower pricing and a wider array of services to meet their health care 
needs. Should the Broadband Services Program have a ``fair share'' 
requirement comparable to the Pilot Program? In particular, should the 
Commission adopt a specific approach to shared services and costs for 
consortium applicants, or should the Commission just require that the 
allocation of the costs of shared services and equipment among 
consortia members be reasonable? We welcome further comment on whether 
the procedures utilized by USAC to implement the fair share requirement 
in the Pilot Program are workable or burdensome, and what measures 
would best address potential waste, fraud and abuse in a reformed 
program.

IV. Competitive Bidding Process and Related Matters

    11. The Pilot Program requires projects to prepare Requests for 
Proposals (RFPs) and to use a competitive bidding process to select 
broadband infrastructure and service providers. It appears that the 
competitive bidding process, in combination with bulk purchasing by a 
large number of health care providers using a single RFP, has led to 
lower prices, better service quality, and more broadband deployment 
than the individual HCPs might otherwise have obtained. In the NPRM, 
the Commission proposed to extend the competitive bidding requirements 
currently applicable to the Primary Program's Internet access program 
to the Broadband Services Program, and sought comment on changes that 
could be made to make the competitive bidding mechanism more successful 
or efficient. We now seek more focused comment on issues relating to 
the competitive bidding process.
    a. Competitive bidding process. Building on the experience gained 
from the Pilot Program, what specific requirements should be in place 
for competitive bidding in the Broadband Services Program, if adopted? 
Should the Commission require consortium applicants in the Broadband 
Services Program to prepare a Request for Proposal (RFP), as applicants 
in the Pilot Program were required to do? Should the Commission exempt 
consortia from the RFP requirement if they are applying for less than a 
specified amount of support (for example, if they are applying for less 
than $100,000 in support)? Are there other elements of the competitive 
bidding process utilized in the Pilot Program that should be applied to 
the Broadband Services Program, either as is or with changes that the 
parties suggest to improve the process? Are there any competitive 
bidding requirements used in the Schools and Libraries Universal 
Service Support Mechanism that the Commission should apply to the 
Broadband Services Program, if adopted?
    b. Requirement to obtain competitive bids. Some commenters indicate 
individual rural HCPs may decide not to seek RHC support due to the 
added administrative burden associated with the competitive bidding 
process. The

[[Page 43778]]

Virginia Telehealth Network (VTN) states that many rural HCPs are in 
areas served by a single broadband provider, where competitive options 
do not exist. Based on USAC's data, approximately 11 percent of RHC 
Primary Program applicants outside Alaska receive bids in the 
competitive bidding process. In response to the NPRM, VTN recommends 
that the Commission consider a streamlined service provider selection 
process for HCPs that do not have multiple broadband service options, 
such as simply requiring an HCP to submit a simple certification of its 
efforts to identify all broadband providers and a description of the 
broadband service option selected. In the Broadband Services Program, 
should competitive bidding only be required for consortium applicants, 
given the experience to date with the current competitive bidding 
requirement for individual HCPs in the Primary Program? We particularly 
seek comment on this question from HCPs who have experience with 
competitive bidding as individual HCPs in the Primary Program. Should 
the Commission consider not applying a competitive bidding requirement 
to individual applicants who request only a limited amount of funding? 
Are there any other applicants that the Commission should exempt from 
competitive bidding requirements under a Broadband Services Program, if 
adopted?
    c. Multi-year contracts. Participants in the Primary Program must 
submit funding requests annually, but may obtain ``evergreen'' status 
for certain multi-year contracts. Participants with evergreen contracts 
are not required to go through the competitive bidding process 
annually. In contrast, Pilot Program participants were awarded a set 
maximum award for a multiple-year period and permitted to carry over 
unused funds from year to year during the duration of the award, which 
has reduced the paperwork they needed to file and may have allowed them 
to lock in stable prices for several years. Notably, a significant 
number of Pilot participants opted to make use of long-term prepaid 
leases and indefeasible rights-of-use (IRU) arrangements. For the 
Broadband Services Program, the Commission proposed to allow evergreen 
contracts, similar to those allowed in the Primary Program, and also to 
allow funding for the lease of lit or dark fiber, which is typically 
purchased under an IRU corresponding to the useful life of the fiber.
    Commenters have suggested that the Commission could encourage high 
capacity broadband networks that would support health care providers' 
telemedicine and broadband needs by allowing HCPs to enter into long 
term contracts for such networks with carriers or other 
telecommunications providers. We seek comment on the benefits and 
drawbacks of providing funding for multi-year contracts, including 
long-term prepaid leases and IRUs, in the Broadband Services Program. 
The Nebraska Statewide Telehealth Network (NSTN) recommends that a 
``true'' evergreen provision be applied to HCPs with multi-year 
contracts, which would allow for HCPs with multi-year contracts to 
apply only once for multiple years of funding.
    Would permitting evergreen contracts (as they are implemented 
today, with the annual filing requirement) be sufficient to allow 
consortia in the Broadband Services Program to reap the potential 
benefits of multi-year contracts, while minimizing administrative 
burdens? Or, would evergreen status need to be coupled with a multi-
year award, and if so, would three years be sufficient for the term of 
the award, or would some other period be more appropriate? We note that 
long-term prepaid leases and IRUs generally involve a large, upfront 
payment. For example, the full cost for a dark fiber IRU is typically 
paid for in advance. If the Commission permitted long-term prepaid 
leases and/or IRUs in the Broadband Services Program, how should it 
deal with upfront payments? How would funding multi-year contracts 
impact the calculation and forecasting of demand for RHC support? What 
protections should be put in place to protect against waste, fraud and 
abuse? For instance, would the measures used in the Pilot Program for 
such arrangements be useful in the Broadband Services Program (such as 
sustainability plans, minimum contract length, and repayment 
requirements)? If so, should those same measures be used, or should 
they be modified in any respect?
    d. Existing Master Services Agreements (MSAs). MSAs permit 
applicants to opt into a contract for eligible services that have been 
negotiated by federal or state government entities without having to 
engage in negotiations with individual service providers. The U.S. 
Department of Health and Human Services has recommended that the 
Commission exempt from competitive bidding requirements federal health 
care providers (such as the Indian Health Service) that are required to 
use the General Services Administration Networx contract for 
telecommunications services. Should the Commission permit applicants 
for the Broadband Services Program to take services from an MSA, so 
long as the original master contract was awarded through a competitive 
process? What specific rules should be in place (e.g., an exception to 
the competitive bidding requirement) in order for HCPs to take 
advantage of MSAs? Should Pilot program participants that have 
exhausted Pilot program funding be able to obtain support from the 
Broadband Services program for services pursuant to MSAs that were 
negotiated by the Pilot projects?
    e. Eligible service providers. The NPRM proposed that broadband 
services supported by the Broadband Services Program may be provided by 
``a telecommunications carrier or other qualified broadband access 
service provider.'' In response to the NPRM, some Pilot participants 
expressed concern that this definition would be too narrow, as it might 
exclude some vendors that responded to RFPs issued by project 
participants. In the Pilot Program, a wide range of service providers 
responded to the RFPs issued by the project participants, including 
telecommunications carriers and companies in the fields of systems 
integration, optical networking, utilities, construction, electronics 
and equipment. We seek more focused comment on the specific definition 
that should be adopted in our rules for eligible providers under the 
Broadband Services Program, if adopted.

V. Broadband Needs of Rural Health Care Providers

    12. Both the National Broadband Plan and the GAO Report emphasized 
the importance of determining the broadband needs of health care 
providers as part of the Commission's reform of its rural health care 
program. A number of parties have commented on the broadband needs of 
health care providers, and USAC has filed an informal needs assessment. 
In light of developments since the issuance of the NPRM, we seek to 
refresh the record on various questions relating to the broadband needs 
of rural HCPs, with particular attention to how the answers may vary 
based on the size and type of HCP, and how the broadband needs may 
change over time.
    a. Telemedicine. What bandwidth is needed for various types of 
telemedicine applications? In particular, how widespread is the use of 
teleradiology, and what bandwidth is required? How widespread is the 
use of videoconferencing in providing telemedicine, and what bandwidth 
is required? Will broadband needs

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associated with telemedicine likely change over time? What factors will 
cause the needs to grow? How important are connections between rural 
HCPs and urban HCPs?
    b. Electronic health records. How will the current trend toward 
adoption and exchange of electronic health records affect bandwidth 
needs? Congress has directed the Medicare and Medicaid programs to 
provide incentive payments for HCPs that have adopted electronic health 
records and have achieved ``meaningful use'' of those records, which 
includes some electronic exchange of those health records. Eventually, 
achieving ``meaningful use'' is expected to be mandatory for recipients 
of Medicare and Medicaid payments. What is the impact of ``meaningful 
use'' incentive payments and requirements on likely demand for 
broadband connectivity for rural HCPs? What is the likely impact of 
participation by rural HCPs in Health Information Exchanges?
    c. Other telehealth applications. What are the likely broadband 
needs for other telehealth applications (e.g., training and technical 
support for health care purposes and health IT applications)?
    d. Service quality requirements. We also seek comment on the needs 
of rural HCPs for such service quality features as dedicated 
connections, redundancy, low latency, and lack of jitter. How much will 
these added levels of quality add to the cost of broadband services for 
HCPs? Will privacy and security requirements applicable to health care 
data exchange affect HCP broadband service quality needs?
    e. Cost savings from broadband connectivity. In the NPRM, the 
Commission recognized that the use of broadband by health care 
providers has the potential to enable them not just to provide higher 
quality health care but also to realize substantial savings in the cost 
of providing health care. Many of the Pilot projects report that the 
broadband connectivity made possible by the program helped to generate 
such cost savings. We solicit specific information regarding the nature 
and magnitude of cost savings that HCPs have been able to achieve 
through use of broadband, as well as information and data regarding 
potential for cost savings through telemedicine and other telehealth 
applications. Many of these cost savings are realized by the HCPs 
themselves, through reductions in the number of and length of hospital 
stays, through savings in patient transport costs, through savings in 
transportation costs and time for medical professionals, and through 
other Health IT applications (such as consolidation of billing and 
scheduling functions, transmission and remote storage of images and 
medical records, and video-based training of health care and health IT 
professionals). Some commenters note that telemedicine also creates the 
potential for rural HCPs to increase revenues, because telemedicine can 
enable rural providers to treat more of their patients locally. 
Telemedicine also yields costs savings for patients and their families, 
who can avoid the cost of travel and loss of workdays by receiving 
treatment closer to home. Some of the cost savings from telehealth 
applications accrue not directly to the HCP or the patients, but rather 
to other governmental entities (through savings in Medicare and 
Medicaid expenditures) and to other participants in the health care 
system (such as private insurers). We solicit the submission of 
specific information on all these possible sources of cost savings, 
including cost data and any studies documenting cost savings.

VI. Procedural Matters

    13. Interested parties may file comments and reply comments on or 
before the dates indicated on the first page of this document. Comments 
are to reference WC Docket No. 02-60 and DA 12-1166 and may be filed 
using the Commission's Electronic Comment Filing System (ECFS). See 
Electronic Filing of Documents in Rulemaking Proceedings, 63 FR 24121 
(1998).
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: https://fjallfoss.fcc.gov/ecfs2/.
     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing. If more than one docket 
or rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number.
    Filings can be sent by hand or messenger delivery, by commercial 
overnight courier, or by first-class or overnight U.S. Postal Service 
mail. All filings must be addressed to the Commission's Secretary, 
Office of the Secretary, Federal Communications Commission.
     All hand-delivered or messenger-delivered paper filings 
for the Commission's Secretary must be delivered to FCC Headquarters at 
445 12th St. SW., Room TW-A325, Washington, DC 20554. The filing hours 
are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together 
with rubber bands or fasteners. Any envelopes and boxes must be 
disposed of before entering the building.
     Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail must be addressed to 445 12th Street SW., Washington, DC 20554.
     People with Disabilities: To request materials in 
accessible formats for people with disabilities (braille, large print, 
electronic files, audio format), send an email to fcc504@fcc.gov or 
call the Consumer & Governmental Affairs Bureau at 202-418-0530 
(voice), 202-418-0432 (tty).

In Addition, One Copy of Each Pleading Must Be Sent to Each of the 
Following

    (1) Chin Yoo, Telecommunications Access Policy Division, Wireline 
Competition Bureau, 445 12th Street SW., Room 5-A441, Washington, DC 
20554; email: Chin.Yoo@fcc.gov; (2) Charles Tyler, Telecommunications 
Access Policy Division, Wireline Competition Bureau, 445 12th Street 
SW., Room 5-A452, Washington, DC 20554; email: Charles.Tyler@fcc.gov.
    14. This matter 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 rule Sec.  1.1206(b). In proceedings governed 
by rule Sec.  1.49(f) or for which the Commission has made available a

[[Page 43780]]

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 this 
proceeding should familiarize themselves with the Commission's ex parte 
rules.

Federal Communications Commission.
Trent B. Harkrader,
Division Chief, Telecommunications Access Policy Division, Wireline 
Competition Bureau.
[FR Doc. 2012-18273 Filed 7-25-12; 8:45 am]
BILLING CODE 6712-01-P