2011-16062. Rural Health Care Support Mechanism

AGENCY:

Federal Communications Commission.

ACTION:

Interim rule.

SUMMARY:

In this document, the Federal Communications Commission (Commission) adopts an interim rule permitting health care providers that are located in a “rural area” under the definition used by the Commission prior to July 1, 2005, and that have received a funding commitment from the rural health care program prior to July 1, 2005, to continue to be treated as if they are located in “rural” areas for purposes of determining eligibility for all universal service rural health care programs. The Commission takes these actions to ensure that health care providers located in rural areas can continue to benefit from connecting with grandfathered providers, and thereby provide health care to patients in rural areas.

DATES:

Effective June 27, 2011.

FOR FURTHER INFORMATION CONTACT:

Chin Yoo, Attorney Advisor, at 202-418-0295, Telecommunications Access Policy Division, Wireline Competition Bureau.

SUPPLEMENTARY INFORMATION:

This is a summary of the Commission's Order (Order) in WC Docket No. 02-60, FCC 11-101, adopted on June 20, 2011 and released on June 21, 2011. This Order was also released with a companion Notice of Proposed Rulemaking (NPRM). The full text of this document is available for public inspection during regular business hours in the FCC Reference Center, Room CY-A257, 445 12th Street, SW., Washington, DC 20554.

I. Introduction

1. In this Order, we adopt an interim rule permitting health care providers that are located in a “rural area” under the definition used by the Commission prior to July 1, 2005, and that have received a funding commitment from the rural health care program prior to July 1, 2005, to continue to be treated as if they are located in “rural” areas for purposes of determining eligibility for all universal service rural health care programs. In the accompanying Notice of Proposed Rulemaking (NPRM) published elsewhere in this issue of the Federal Register, we seek comment on whether to make these “grandfathered” providers permanently eligible for discounted services under the rural health care program. Grandfathered providers do not currently qualify as “rural,” but play a key role in delivering health care services to surrounding regions that do qualify as “rural” today. Thus, we take these actions to ensure that health care providers located in rural areas can continue to benefit from connecting with grandfathered providers, and thereby provide health care to patients in rural areas.

II. Order

2. In this order, we adopt an interim rule to allow all currently grandfathered health care providers to continue to qualify for discounted services until the Commission adopts permanent rules governing the eligibility of such providers to participate in rural health care programs. We find good cause to adopt this interim rule without notice and comment, and to make it effective upon publication in the Federal Register rather than 30 days afterwards. For the reasons below, we find that it is unnecessary and contrary to the public interest to delay adoption of this interim rule.

3. Section 553 of the Administrative Procedure Act (APA) requires that agencies provide notice in the Federal Register and an opportunity for public comment on their proposed rules except, inter alia, “when the agency for good cause finds (and incorporates the finding and a brief statement of reasons therefor in the rules issued) that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.” Notice and comment have been excused in emergency situations or where delay could result in serious harm. In addition, section 553(d) of the APA requires a substantive rule to be published not less than 30 days before its effective date, except “as otherwise provided by the agency for good cause found and published with the rule.”

4. Without a change in our rules before June 30, 2011, currently grandfathered providers will lose eligibility for discounted services. In 2008, the Commission found that discontinuing services to these providers would “serve only to endanger the continued availability of telemedicine and telehealth services that [these] health care facilities provide.” For the reasons below, we find that such an outcome remains as likely to happen today as in 2008, and thus would be contrary to the public interest.

5. The record demonstrates that grandfathered facilities, while not located themselves in a “rural area” under current Commission definitions, play a key role in providing health care services to “fundamentally rural” areas. These providers are not located in large urbanized areas. In some instances, the grandfathered health care provider is a primary or secondary hub in a network that serves health care providers and patients located in areas that do qualify as “rural” under our current definition. Discontinuance of rural health care support would make vulnerable rural providers that connect to these hub sites. For example, three grandfathered facilities in Nebraska are hub hospitals in the Nebraska Statewide Telehealth Network (NSTN), a “hub-and-spoke” statewide telehealth network in which nearly 80 percent of providers are eligible for rural health care support. The Nebraska hub hospitals currently receive support for backbone lines that carry traffic for the entire NSTN, including traffic for rural sites, and the majority of interactions over the backbone lines benefit small rural health care providers and those they serve, not the hub site.

6. The record also provides numerous examples of the critical services that the petitioners and other affected health care providers offer to their patients. By its nature, telehealth allows health care providers that are not themselves located in “rural” areas to provide services to patients that are located in rural areas. In particular, many grandfathered facilities are located in regions experiencing specialty health care shortages, which these facilities are seeking to remedy via telemedicine. Services provided by grandfathered facilities include the following: emergency services, preventative care, interactive video, counseling, specialist consultations, oncology, psychiatry, neurology, tele-trauma, teleradiology, health professional and community education, and other telehealth and telemedicine applications.

7. Without continued funding, these facilities will likely be unable to continue providing telehealth services to rural areas. Virginia Telehealth Network (VTN) states that many grandfathered providers do not enjoy the benefit of competitively priced broadband services and would likely no longer be able to afford to continue their telehealth programs without discounted services. Similarly, NSTN states that if the Commission takes no action, its hub sites will be unable to sustain the costs of the backbone lines, which would directly sever the connection of 40 eligible rural sites from the NSTN. According to the NSTN, these 40 sites would be unable to connect to tertiary care centers, which serve as their referring hospitals, and to other rural health sites. Access to specialized care via telehealth in rural Nebraska would be compromised, and in some cases, cease to exist. More generally, the American Telemedicine Association (ATA) explains that the loss of existing facilities supported by universal service could “result in the loss of health care services to populations that have unmet health care needs, that are remote and rural to the location of those services, and are most disparate.” Thus, we find that discontinuance of funding could result in serious harm to affected rural health care providers and their patient populations, and such harm would be contrary to the public interest.

8. We note that continued grandfathering on an interim basis will also support important Commission, federal, and state health information technology (health IT) priorities. For example, the Tanana Chiefs Conference states that continued funding is needed to meet bandwidth requirements created by National Broadband Plan initiatives, adoption of electronic health record meaningful use requirements by HHS, and Alaska's statewide health information exchange initiative. VTN and the Office of Telemedicine of the University of Virginia Health System (UVA) explain that Virginia was recently awarded two federal rural health IT grants to create a demonstration tele-stroke network and to deliver high risk obstetric services. Both Virginia projects include grandfathered health care providers as partners, and elimination of discounted services to these providers would adversely impact the projects' ability to sustain the federal grants. Similarly, NSTN states it has been successful in developing a model, comprehensive, statewide network in which the federal government has invested over $1.4 million, but the discontinuance of funding to Nebraska's grandfathered hub hospitals would result in the transformation of this statewide network into isolated “mini” networks.

9. We also find that notice-and-comment and 30-day advance publication in the Federal Register is unnecessary for this interim rule. The purpose of the notice-and-comment requirement is to allow interested parties to respond to the proposed rule and participate in the rulemaking process. In July 2010, the Nebraska Public Service Commission (Nebraska PSC) filed a petition requesting that the FCC permanently grandfather health care providers that were temporarily grandfathered until 2011. In response to the Nebraska PSC petition, the Wireline Competition Bureau issued a public notice requesting comment on whether the Commission should grant the relief sought by the Nebraska PSC, either through permanent grandfather, permanent waiver, or other action, and interested parties had an opportunity to respond to the public notice. We note that all commenters, including all affected health care providers, support at least an interim extension of the grandfathering period. The 30-day advance publication requirement of section 553(d) is intended to inform affected parties of the proposed rule and afford them a reasonable time to adjust to the new regulations. The purpose of our interim rule, however, is to maintain the status quo while we consider amending our rules permanently. Thus, as a practical matter, there is no “new” regulation to which grandfathered health care providers must adjust. Indeed, the National Telecommunications Cooperative Association argues that without the interim extension, grandfathered entities would be left without a needed “transition period * * * to accommodate for any lost USF revenues and to comply with” new requirements, and would be forced to “scramble for alternative technology solutions and funding sources.” In addition, as discussed above, grandfathered providers, in the aggregate, have historically received less than $1.4 million annually in discounted services, or less than 0.02 percent of the $8 billion universal service fund. Therefore, we find that the interim rule will not materially affect entities that contribute to the universal service fund, because their individual contributions will not change significantly. Based on the foregoing, we find good cause to adopt this interim rule without notice and comment.

III. Procedural Matters

A. Final Regulatory Flexibility Certification

10. Interim Rule. The interim rule adopted in this Order is being adopted without notice and comment, and therefore is not subject to Regulatory Flexibility Act analysis under 5 U.S.C. 604(a).

11. Proposed Permanent Rule. The Regulatory Flexibility Act of 1980, as amended (RFA), requires that a regulatory flexibility analysis be prepared for notice-and-comment rule-making proceedings, unless the agency certifies that “the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities.” 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 which: (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).

12. An initial regulatory flexibility analysis (IRFA) was incorporated in the Second Report and Order, 70 FR 6365, February 7, 2005. The Commission sought written public comment on the proposals in the Second Report and Order, including comment on the IRFA. No comments were received to the Second Report and Order or IRFA that specifically raised the issue of the impact of the proposed rules on small entities.

13. In this Order, we now indefinitely extend, and propose to adopt permanently, the Commission's prior determination to grandfather those health care providers who were eligible under the Commission's definition of “rural” prior to the Second Report and Order. This has no effect on any parties that do not currently participate in the rural health care support program. It does not create any additional burden on small entities. We believe that this action imposes a minimal burden on the vast majority of entities, small and large, that are affected by this action.

14. Therefore, we certify that the requirements of the order will not have a significant economic impact on a substantial number of small entities.

15. In addition, the Order and this final certification will be sent to the Chief Counsel for Advocacy of the SBA, and will be published in the Federal Register.

B. Other Matters

16. Congressional Review Act. The Commission will send a copy of this Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act. See 5 U.S.C. 801(a)(1)(A). The interim rule contained in this Order shall take effect upon publication of a summary of the Order in the Federal Register for the reasons stated therein. See id. Sec. 808(2).

List of Subjects in 47 CFR Part 54

• Communications common carriers
• Reporting and recordkeeping requirements
• Telephone

Federal Communications Commission.

Marlene H. Dortch,

Secretary.

Interim Final Rule

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 54 to read as follows:

PART 54—UNIVERSAL SERVICE

1. The authority citation for part 54 continues to read as follows:

Authority: 47 U.S.C. 1, 4(i), 201, 205, 214, and 254 unless otherwise noted.

2. Amend § 54.601 by revising paragraph (a)(3)(i) to read as follows:

§ 54.601

Eligibility.

(a) * * *

(3) * * *

(i) Notwithstanding the definition of “rural area” in § 54.5, any health care provider that is located in a “rural area” under the definition used by the Commission prior to July 1, 2005, and received a funding commitment from the rural health care program prior to July 1, 2005, is eligible for support under this subpart.

* * * * *