Non-ETC (Long Distance) Carriers Eligible for Support

Effective with the 11/3/1999 release of the FCC's Fourteenth Order on Reconsideration (CC Docket No. 96-45, FCC 99-256), telecommunications carriers are no longer required to be eligible telecommunications carrier (ETCs) to participate in this program. All common carriers may participate, including interexchange (IXC), long-distance carriers. This change shall be applied prospectively to all future commitments of support for the benefit of rural health care providers, including all pending requests therefor. Applicants affected by this, who completed the required 28-day posting for the 1998 funding year, who have not received a funding commitment, should immediately submit Forms 466 and 468 for their chosen carrier.

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Changes for RHCD Funding Year 3 (July 1, 2000 to June 30, 2001)

The FCC released the Fifteenth Order On Reconsideration (CC Docket No. 96-45 & 97-21) on November 1, 1999. This order will be effective with the start of the 3rd RHCD funding year (July 1, 2000 to June 30, 2001). This order: (1) Eliminates the limit on funding a telemedicine location can receive (the per-location-funding-limit); (2) Authorizes support for any commercially available telecommunications service, regardless of bandwidth. (Previously, only services up to 1.44 Mbps (T-1) were eligible); (3) Simplifies the application process by eliminating the requirement that discounts be based on tariffed or public rates for the telecommunications service. Instead, discounts will be based on actual distance charges; and (4) Affirms the ability of rural health care providers to join consortia and be eligible for discounts, even if the consortia receives volume discounts. It also allows new members to be added to such consortia at any time.

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Submitting Form 465 for the 1999 Funding Year

The FCC requires health care providers to complete applications each funding year to receive universal service support. To prevent any interruption in support from year to year, applicants must submit and post their Form 465 for 28 days prior to receiving support. If you have not submitted Form 465 for the 1999 Funding Year please do so immediately.

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Discounts on Services to Flow to Rural Health Care Providers

Today, the Federal Communications Commission accepted the results of the Rural Healthcare Division's audit conducted by independent auditor, Deloitte & Touche on the operational procedures for issuing universal service discounts to rural health care providers. With this final clearance, the Rural Health Care Division (RHCD) of the Universal Service Administrative Company (USAC) will begin issuing Funding Estimate letters to eligible applicants for year one discounts.

In a letter to USAC, FCC Chairman William Kennard said "Congratulations to you and your staff for a successful audit. I appreciate your dedication to seeing this audit through completion and the efforts that you and your staff have generally invested in implementing the rural health care program. Please accept my assurance that I, too, am committed to delivering specific federal universal service support to rural health care providers. I look forward to working together as we continue toward this mutual goal."

The RHCD will begin issuing Funding Commitment Letters (FCL) to applicants seeking discounts on telecommunications service for the 1998-1999 year shortly. The FCL notifies applicants that they have been approved for telecommunications service and provides an estimated support for the funding 1998-1999 funding year. Upon receipt of the FCL, rural health care providers must file a final form with the RHCD verifying that services have begun to flow in order for a funding commitment to be made.

End of Year One Year

One of the RHCD support program will end on June 30, 1999. All Year One applicants must complete the application process (submit Forms 466/468 by September 30, 1999 and Form 467 by December 31, 1999). Attached for your information is a report that indicates the number of Year One applications received by State.

On March 1, 1999, the RHCD began accepted applications for Year Two (which will begin on July 1, 1999 and end on June 30, 2000). All eligible RHCPs who did not apply for support in Year One are encouraged to apply for support for Year Two. Information concerning the number of Year Two forms received (by State) is also attached.

On May 2, 1999, the FCC released its Twelfth Order on Reconsideration which established $12 million as the collection level for the second funding year of the RHCD support program (July 1, 1999 to June 30, 2000). Although the FCC modified the collection level, they did not revise the $400 million annual cap for the rural health care support mechanism adopted in the Universal Service Order.

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Rural Health Care Division Funding Level For Year Two Set at $12M

Today,the Federal Communications Commission (FCC) set the fund level for year two for the Rural Health Care Division at $12 million. Year two of the program begins on July 1, 1999 and ends on June 30, 2000.

The FCC directed collections at the rate of no more than $3 million per quarter for the third and fourth quarters of 1999 and the first and second quarters of 2000 for the rural health care universal service support mechanism. This amount is consistent with demand projections submitted by the Universal Service Administrative Company in the March 5, 1999 Report to the FCC.

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Form 468 Worksheet - Version 1.5

Form 468 Worksheet - Version 1.5 and instructions for completing the Worksheet are now available on the RHCD Web Site. The new version of the Worksheet can be used for the 1998 or 1999 Funding Year. RHCD recommends that telecommunications carriers use the new Worksheet for calculating support for all health care providers going forward. If a previous version of the Worksheet was submitted for a health care provider, telecommunications carriers do not need to fill out the new version of the Worksheet for the circuit.

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Rural Health Care Program Update

Over the next few weeks, the Rural Health Care Division (RHCD) of the Universal Service Administrative Company (USAC) will be working to obtain clearance from our auditors, Deloitte & Touche, and the Federal Communications Commission on our processing procedures. Once the audit is complete, we will be ready to issue funding commitment letters to qualified applicants who have sought discounts for service in the 1998 Funding Year.

There are sufficient funds available to support all qualified applicants for the 1998 Funding Year. If your Forms 466 and 468 have not been completed and submitted to RHCD, you will not receive a funding commitment letter. If you have received a letter from us stating that your application is incomplete, we encourage you to provide us with the missing information as soon as possible. If it is unclear what information is needed to complete your application, please call our Customer Service Support Center at 1-800-229-5476.

As of April 1, 1999, the Rural Health Care Division reports the following application information.

• 1072 Form 465 applications have been received and posted covering
• 2539 rural health care sites in 47 states.
• 442 Form 466/468 packages have been received for processing covering 366 sites.
• RHCD expects to receive an additional 200 packets covering an additional 180 sites by June 30, 1999 from applicants who have not yet completed the application process.
• RHCD expects to commit almost $3 million by June 30, 1999 to those applicants who have successfully completed the application process.

The 1998 Funding Year (Year 1) is expected to end on June 30, 1999. On March 1, 1999, RHCD began accepting applications for the 1999 Funding Year (Year 2) which runs from July 1, 1999 to June 30, 2000. Unless the FCC again extends the 1998 Funding Year, Year 2 applications must be submitted for the required 28 day posting in order for you to receive support after June 30, 1999.

USAC's March 5 Report to the FCC on the rural health care program was sent out for public comment in late March and the comment period ended in early April. The Report and the comments all underscored the need to:

• Make commitments as early as possible
• Simplify the application process
• Expand the list of covered services eligible for support

These recommendations and comments are now before the FCC for consideration.

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USAC Report on RHCD Program

On March 5, 1999, USAC released "Report to the FCC: Evaluation of the Rural Health Care Program." The 55-page report highlights the program's current status, and provides recommendations for program improvement. On March 7, 1999, the FCC issued a public notice requesting comments on the report (CC Docket Nos 96-45 and 97-21, DA 99-521), due March 29, 1999. To review the report, click on the link that follows.

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Update on Status of Universal Service Fund Rural Health Care Program

The purpose of this notice is to provide you with an update on the status of the Universal Service Fund (USF) rural health care program. This notice coincides with the winding-down of the 1998 Funding Year and the start of the 1999 Funding Year. To date, the Rural Health Care Division (RHCD) of the Universal Service Administrative Company (USAC), formerly the Rural Health Care Corporation (RHCC), has received almost 1,500 applications representing over 3,100 rural health care providers (HCPs). This notice provides information on the following topics:

1. Recent Events
2. Funding Year 1998 Update
3. Funding Year 1999 Program

 

1. Recent Events

USAC Merger Effective January 1, 1999
Effective January 1, 1999, the RHCC was merged into the USAC. As a result, the RHCC became the Rural Health Care Division of USAC. The Web Site address has also changed. In the future, please use www.rhc.universalservice.org to access the RHCD site.

Six-Month Extension of 1998 Funding Year
On December 31, 1998, the FCC approved a six-month extension of the RHCD 1998 Funding Year to June 30, 1999. Consequently, 1998 applications are eligible for funding from January1, 1998 through June 30, 1999.

FCC Report on the Rural Health Care Program
Last December, the FCC requested that USAC evaluate and formally report on the rural health care program by March 1, 1999 (FCC 98-318, December 4, 1998). The report includes recommendations for increasing program participation while lowering administrative costs. To view the full report, click here.

2. 1998 Funding Year Update

Year 1 Application Deadlines
1998 Form 465s must be received by May 15, 1999. All "new service" requests must comply with the 28-day posting requirement prior to selection of a telecommunications carrier. Forms received after May 15th will not be posted in time to qualify for support before June 30th. However, if the HCP seeks support for a contracted "existing service" that was signed before May 1, 1998, the HCP may submit Form 465 up to June 30, 1999, which is the last day Form 465s will be accepted. 1998 Forms 466 and 468 must be received no later than September 30, 1999. Form 467 for 1998 must be received no later than December 31, 1999.

Approval Notification Letters
To date, the RHCD has received approximately 400 Form 466/468 "packets". We expect to begin sending Approval Notification Letters (ANL) around May 1, 1999. The ANL indicates that a HCP will receive support contingent upon completion of Form 467. The ANL also informs the HCP of its estimated level of support based on the non-recurring (i.e., installation) and monthly recurring costs of the telecommunications service and the months of support. A blank Form 467 will be included with the ANL for the HCP to complete and remit to the RHCD.

Health Care Provider Support
Once the Form 467 has been processed, HCPs and telecommunications carriers will receive a detailed Support Forecast and support will begin to appear as a credit on the HCPs' telecommunications bills. If an entity other than the HCP (i.e., third party) receives and pays the bill for the HCP's telecommunications service, the credit will be provided on the third party's telecommunications bill.

3. Funding Year 1999 Program

New Forms in 1999
New 1999 forms (465, 466, 467, and 468) are posted on the RHCD Web Site in the forms section. HCPs may complete forms on-line or download a copy to submit on paper. While much of the information requested is similar to the information requested on the 1998 forms, the new forms must be used. If the HCP submits a form electronically, the HCP is still required to print and remit a signed paper copy to the RHCD before its form can be processed.

Funding Year 1999 Form 465 Postings -- Avoiding Disruption in USF Support
All HCPs that seek USF support for Funding Year 1999 must comply with the 28-day posting requirement. The only exception is if an HCP entered into a service contract signed by July 10, 1997. If the HCP requested Funding Year 1998 support and wishes to avoid a disruption in support for 1999, the 28-day posting requirement must be satisfied before July 1, 1999.

Questions
If you have any questions or need additional information, please call the Customer Service Support Center at 1-800-229-5476. Hours of operation are 8 a.m. to 8 p.m., Eastern Time, Monday through Friday.

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1999 Funding Year

The RHCD started accepting applications for the 1999 Funding Year on March 1, 1999. The 1999 Funding Year starts on July 1, 1999 and ends on June 30, 2000.

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Schools and Libraries Corporation and Rural Health Care Corporation Merge into the Universal Service Administrative Company

The Schools and Libraries Corporation (SLC) and the Rural Health Care Corporation (RHCC) have merged with the Universal Service Administrative Corporation (USAC). The merger is effective on January 1, 1999. One entity will now be responsible for administering the telecommunications universal service programs for the Federal Communications Commission. The universal service programs help to provide access to modern telecommunications services to schools, libraries, rural health care facilities, and consumers regardless of geographic location or socioeconomic status. The new structure will enable the integrity and focus of the targeted programs to be maintained while bringing additional efficiencies to the administration of the programs.

As a result of the merger, the Rural Health Care Corporation (RHCC) and the Schools and Libraries Corporation will become divisions of USAC. USAC will create a third division for the High Cost and the Low-Income universal service programs. Committees of the USAC Board will govern each division. Each committee of the USAC Board will be responsible for overseeing the budgets of its respective division and will report to the USAC Board. Any action taken by a committee is subject to review by the USAC Board.

USAC was created in 1997 as a subsidiary of the National Exchange Carrier Association, Inc., and is governed by a Board of Directors that includes a broad representation of both industry and non-industry interests, including representatives of service providers, schools and libraries, health care providers, consumers, and state regulatory commissions. USAC was responsible for overseeing the administration of the High Cost and the Low Income universal service programs as well as the billing, collection, and disbursement of funding for the high cost, low income, schools & libraries, and rural health care programs.

The RHCC was the not-for-profit corporation responsible for administering the universal service program for Rural Health Care Providers and was created to guarantee rural Americans access to affordable telecommunications technology by ensuring that rural health care providers pay no more for telecommunications services than their urban counterparts.

The SLC was the not-for-profit corporation responsible for administering the Universal Service program for Schools and Libraries. Under this program schools and libraries can apply for discounts ranging from 20% to 90% on telecommunications services, Internet access, and internal connections.

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