The FCC approved an order reforming the smallest of the...

changes are aimed at expanding provider access to broadband especially in rural areas and encouraging the creation of state and regional broadband healthcare networks, officials said Wednesday. The order builds on lessons learned from a pilot program approved by the commission in 2008. The order also creates a pilot program slated to start in 2014, to study how the program could be expanded to optimize care for patients in skilled nursing facilities. A commission news release said the order removed “artificial limitations on technology and provider type that hampered legacy universal service health care support,” requires participants to contribute 35 percent of the costs “increasing fiscal responsibility” and supports broadband services “purchased from diverse communications providers, while also allowing health care providers to construct new broadband networks when that is the most cost-effective option.” Parts of the reform efforts proved controversial. Commissioner Robert McDowell would only concur with parts of the order. McDowell complained that the program rules only require that a “majority” of consortia members be rural. “While some rural health care participants may benefit by using the experts and specialists that non-rural participants can offer as members of a consortia, simply requiring a ‘majority’ of the members to be rural is insufficient,” he said. “The intended focus of this USF program should be for rural America, that is, parts of the country that typically are far from hospitals.” McDowell also said he was pleased that the program remains capped at $400 million per year. “I am not convinced that the annual demand will stay below the cap in the foreseeable future, as projected in this order,” he said. “As such it would have been more prudent for the commission to include in this order a contingency plan to allocate priorities if the program does approach the spending cap.” McDowell also opposed the new pilot for skilled nursing facilities. “We certainly shouldn’t be laying the foundation for inflating the program before assessing the effect of the other reforms we adopt today,” he said. Commissioner Ajit Pai dissented to parts of the order. Pai was also concerned about the new pilot program. “The order recognizes that, ‘on this record,’ this program may not comply with Section 254 of the Communications Act,” he said. “That provision directs us to support ‘health care providers,’ and yet the order reaches ‘no conclusion about whether or under what circumstances a [skilled nursing facility] might qualify as a healthcare provider under the statute.’ It’s also fair to say that we have not had the chance to assess how the reforms we implement today will work on the ground and how much the new Health Care Connect Fund will cost.” Pai also questioned budget caps in the order. “The order defers hard decisions about enforcing these caps,” he said. “This leaves in place the current first-come-first-served system. As a result, everyone who submits an application will get fully funded, until one day, they won’t.” But Commissioner Mignon Clyburn was more enthusiastic. “This marks the fourth tine under the leadership of Chairman [Julius] Genachowski that the FCC has voted to reform a Universal Service Fund program as recommended by the National Broadband Plan.”