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AHA Letter: Broadband Funding Cuts Threaten Telehealth Expansion

The American Hospital Association is urging the FCC to fully fund the Rural Health Care Program, saying proposed budget cuts are putting rural providers in peril and endangering telehealth expansion.

Source: ThinkStock

By Eric Wicklund

- The American Hospital Association is protesting planned funding cuts to the Rural Health Care Program, saying the loss of money will severely impact telehealth and telemedicine programs in remote and rural communities around the nation.

In a letter dated April 24 and sent to Federal Communications Commission Secretary Marlene H. Dortch, the AHA takes aim at the Universal Service Administrative Company’s (USAC) March announcement that it will reduce RHC funding for the 2017 fiscal year by 15 percent for individual participants and 25 percent for consortia participants.

USAC is the independent administrator to the RHC program, which provides funding to eligible healthcare providers for broadband services to enhance delivery and quality of care. Among the most common uses for that funding is to improve connectivity to launch and expand telehealth and telemedicine programs in remote and rural regions.

According to the AHA, the unexpected funding cuts, announced eight months into the fiscal year, “not only affect the ability of these rural health care providers to maintain strong broadband connections but also could force tough decisions affecting funding for essential health care services.”

The organization made note of three states in which the cuts are especially painful.

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In Alaska, the Alaska Native Tribal Health Consortium “estimates $18 million in lost subsidies for tribal facilities, which will leave them effectively paying 25 times the urban rate for connectivity and facing tough decisions given their limited budgets,” the AHA reported. The Alaska State Hospital and Nursing Home Association, meanwhile, is bracing for $1.5 million in extra expenses.

In Kansas, the AHA said, the newly formed Kansas Health-e Broadband Consortium, comprising 55 sites and including 21 critical access hospitals, sees the RHC funding as “a way to secure the communications infrastructure needed for daily operations and innovative services, such as telehealth.” Because of those cuts, the AHA says the consortium is facing “financial challenges” and may not have a clear path forward.

And in Colorado, the funding cuts have affected a wide range of hospitals, rural health clinics, federally qualified health centers and behavioral health organizations.

“This is especially disheartening to small rural hospitals that already face slim operating margins and have set their budgets for 2018 and 2019,” the AHA letter reported. “These hospitals now need to adjust their budgets to accommodate the increase in monthly costs to maintain broadband capabilities. In many cases, they will need to reduce or eliminate other essential programs to accommodate this increase in operating costs.

The USAC’s proposed cuts came as a surprise for healthcare providers who had been led to believe they would see more money for broadband expansion.

READ MORE: Alaska Lawmakers Link Telehealth Growth to Better Broadband

In January, following months of debate and public meetings, the FCC announced plans to revamp the funding formula for the RHC fund, which had been capped at $400 million since its inception some 21 years ago. Noting that requests for funding had eclipsed the funding cap the past two years, the agency floated a proposal to adjust the fund upwards to account for inflation, and it ordered that leftover funding from past years be used to meet current requests.

That decision drew praised from, among others, the AHA and the American Association of Family Physicians, both of which sent letters to the agency lobbying for more support for broadband expansion efforts.

“Telehealth technologies can enhance patient-physician collaborations, increase access to care, improve health outcomes by enabling timely care interventions, and decrease costs when utilized as a component of, and coordinated with, longitudinal care,” AAFP Board Chairman John Meigs, Jr., MD, wrote in a letter to Dortch. “Responsible care coordination is necessary to ensure patient safety and continuity of care for the immediate condition being treated, and it is necessary for effective longitudinal care.”

But the FCC hasn’t yet acted on that proposal. And two months later, the USAC - saying it can’t meet the $521 million in requests even with the extra funding made available – announced the funding cuts.

The AHA is calling on the FCC to “fully fund qualified applicants under the RHC program for fiscal year (FY) 2017 and to take steps to permanently adjust the cap to prevent similar funding cuts in the future.”

READ MORE: Picking The Right Telehealth Platform For a Small or Solo Practice

“The AHA appreciates the FCC’s attempts to soften the blow this year by making unused funds from prior years available and allowing companies to lower prices for requested services, but these steps clearly were not sufficient,” the AHA said. “Now more than ever, innovations in health care demand connectivity for telehealth, remote monitoring, patient engagement and daily operations.”

“The Commission has expressed a strong commitment to meeting the broadband connectivity needs of rural health care providers and thereby improving the lives of rural Americans,” the letter concludes. “Reversing the large and unexpected cuts to FY 2017 funding under the RHC program and putting the program on a path to provide sufficient and predictable funding in FY2018 and beyond would be consistent with that commitment.”


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