CHA News Article

FCC Announces New Permanent Rural Health Care Subsidy Program

The Federal Communications Commission (FCC) announced this week a new permanent rural health care subsidy program, the Healthcare Connect Fund (HCF), to replace the Rural Health Care Pilot Program (RHCPP).  The purpose of the HCF is to expand broadband access to health care providers and support state and regional broadband networks for health care. The RHCPP has provided the primary funding for the California Telehealth Network’s (CTN) broadband services and enrolled 367 eligible health care providers (HCPs) — both rural and urban. CHA is a member of the CTN Board of Directors and participated in the stakeholder comment process for the permanent program. 

The HCF will support the cost of (1) broadband and other advanced services; (2) upgrades of existing facilities to higher bandwidth; (3) equipment needed to create networks of health care providers and receive broadband services; and (4) health care provider-owned infrastructures shown to be the most cost-effective option.  Additional highlights of the HCF include:

  • Both rural and urban HCPs will remain eligible – provided they participate in a consortium where a majority of the HCPs are rural. RHCPP participants are grandfathered.
  • Overall funding cap of $400 million will be maintained; $150 million/year cap on support for infrastructure/long-term leases/pre-paid leases for services. 
  • New “pilot” program for skilled-nursing facilities ($50 million over three years); details of the program will be developed by Wireline Bureau.

Despite comments from CTN, CHA and other stakeholders opposing the change, the FCC reduced the program’s subsidy level from 85 percent to 65 percent of broadband deployment costs.  This means the match required for future program participants will increase from 15 percent to 35 percent.  The FCC may be open to addressing this issue in the future, especially if it proves to be a barrier to participation for small, rural and underserved health care providers.

The FCC is expected to release the order document soon.