AHA calls on FCC to restore funding levels for Rural Health Care program

The American Hospital Association is speaking out about "unexpected and significant funding cuts" made to the Rural Health Care program that happened in March. 

In a letter addressed to FCC Secretary Marlene Dortch, the AHA is urging the FCC to fully fund qualified applicants through fiscal year 2017 and to permanently adjust the funding cap to prevent future cuts.

The Rural Health Care program provides funding to eligible health care providers for telecommunications and broadband services that facilitate healthcare delivery, including telehealth. Funding for the effort is capped at $400 million annually, which has been the limit since the program's implementation, more than 20 years ago. In 2016, the cap was exceeded for the first time and then again in 2017. Had there been an adjustment for inflation annually from the start of the program, the cap for 2017 would have been $517 million, which would have accommodated the $521 million in requests received during 2017.

In its proposed rule, the FCC has suggested instituting a yearly inflation adjustment, including a "catch up adjustment" for 2017. The AHA has expressed support for this approach but while the FCC has yet to conclude its rulemaking on this issue the budget was cut by 15 percent for individual participants and 25 percent for consortia participants. 

"Unfortunately, these deep reductions were announced eight months into the funding year, and were far greater than anticipated. These cuts 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 AHA wrote.

The Association cited several examples of hardships caused by the cuts, including in Colorado, where small rural hospitals that have already set budgets for 2018 and 2019 will now have to make possibly painful adjustments to accommodate the increase in monthly costs to maintain broadband capabilities, including the elimination of other valuable programs. 

AHA also wrote that in Kansas 55 sites, including 21 critical access hospitals, have been participating in the newly-formed Kansas Health-e Broadband Consortium to solidify a communications infrastructure needed for daily operations and services like telehealth will also face financial issues. 

The Alaska Native Tribal Health Consortium, meanwhile, estimates $18 million in lost subsidies for tribal facilities and will likely end up paying 25 times the urban rate for connectivity. For the state's rural non-tribal hospitals, the Alaska State Hospital and Nursing Home Association forecasted more than $1.5 million in unanticipated expenses due to the cuts. While they expressed appreciation for the option of using unused funds from past years to soften the blow of the cuts, and allowing companies to lower prices for services, it is not enough, especially as the demand for innovation and telehealth grows stronger.

"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," AHA wrote. "Reversing the large and unexpected cuts to 2017 funding under the RHC program and putting the program on a path to provide sufficient and predictable funding in 2018 and beyond would be consistent with that commitment."

Twitter: @BethJSanborn
Email the writer: beth.sanborn@himssmedia.com