Rural Health Care Suport Mechanism

Federal Communications Commission

FCC 07-6

Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of
Rural Health Care Support Mechanism

)
)
)

WC Docket No. 02-60

ORDER ON RECONSIDERATION
Adopted: February 5, 2007

Released: February 6, 2007

By the Commission:
I.

INTRODUCTION

1. In this Order, we grant a Petition filed by National LambdaRail, Inc. (NLR)1 seeking
reconsideration or, in the alternative, clarification of the Commission’s order establishing a rural health
care pilot program to encourage the provision of telehealth and telemedicine services throughout the
nation.2 Specifically, we find that pilot program applicants may request and, if selected, may receive
funding to support up to 85 percent of the cost of connecting state and regional broadband networks to the
University Corporation for Advanced Internet Development, Inc. (Internet2) or NLR. We further find
that an applicant that proposes to connect its state or regional broadband networks to Internet2 or NLR
may either (1) pre-select Internet2 or NLR; or (2) seek a competitive bid for the provision of nationwide
backbone services from Internet2 or NLR. To ensure the success of the pilot program, we expect that
Internet2 and NLR will interconnect or peer with each other. Finally, we provide applicants with an
additional thirty (30) days time to submit their applications to the Commission.
II.

BACKGROUND

2. On September 26, 2006, the Commission established a pilot program, pursuant to section
254(h)(2)(A) of the Telecommunications Act of 1996 (Act), 3 to examine how the universal service rural
health care funding mechanism can be used to enhance public and non-profit health care providers’ access
to advanced telecommunications and information services.4 Specifically, the pilot program will provide
funding to support up to 85 percent of the cost of the construction of state or regional broadband networks
and advanced telecommunications and information services provided over those networks.5 In addition,
the Commission specified that the pilot program would provide funding to support up to 85 percent of the
1

Rural Health Care Support Mechanism, WC Docket No. 02-60, Petition for Reconsideration or, in the Alternative,
Clarification by National LambdaRail, Inc. (filed Oct. 30, 2006) (Petition).
2

See generally Rural Health Care Support Mechanism, WC Docket No. 02-60, Order, 21 FCC Rcd 11111 (2006)
(Rural Health Care Pilot Program Order).
3

47 U.S.C. § 254(h)(2)(A).

4

See generally Rural Health Care Pilot Program Order, 21 FCC Rcd 11111.

5

See id. at 11111-12, 11115, paras. 1, 3, 14. Because participants are authorized to spend program funds on the
costs of advanced telecommunications and information services, applicants are permitted to request funding to
connect their proposed networks to the public Internet.

Federal Communications Commission

FCC 07-6

cost of connecting the state or regional broadband networks to Internet2, a nationwide backbone
provider.6 While the Commission indicated that funding provided by the pilot program could be used to
connect constructed state or regional broadband networks to Internet2, we did not indicate that such a
connection was required.7 Thus, under the pilot program, applicants are free to propose the construction
of state or regional broadband networks that would not be connected to any nationwide backbone.
3. On October 30, 2006, NLR filed a Petition for Reconsideration or, in the Alternative,
Clarification of the Commission’s Rural Health Care Pilot Program Order.8 In its Petition, NLR asked
the Commission to reconsider or clarify the Rural Health Care Pilot Program Order “by finding that . . .
the pilot program will also provide funding to support the cost of connecting state and regional networks
to NLR.”9
4. The Wireline Competition Bureau sought comment on the Petition on November 6, 2006.10
Most commenters supported the Petition, asserting that funding connections to NLR would lower costs,
provide redundancy, and promote competitive neutrality, as required by section 254(h)(2)(A) of the Act. 11
Other commenters opposed the Petition, arguing that connecting to a single dedicated nationwide
backbone provider, Internet2, is more efficient and would ensure that participating health care networks
are interoperable. 12
III.

DISCUSSION

5. In this Order, we grant NLR’s Petition and find that a pilot program applicant may request
and, if selected, may receive funding to support up to 85 percent of the cost of connecting state and
regional broadband networks to Internet2 or NLR.13 The Commission finds that it will serve the public
interest to allow applicants to request funding to support the cost of connecting state and regional
broadband networks to NLR as well. We limit our decision here by providing for the inclusion in the
6

See id. at 11111, para. 2. Further, the Commission capped the amount of money available for the pilot program for
each funding year at $100 million, less the amount committed to the existing rural health care mechanism for the
appropriate funding year. Id. at 11115, para. 12.
7

Rural Health Care Pilot Program Order, 21 FCC Rcd at 11111-2, para. 1-2, ("[T]he pilot program will provide
funding to support the construction of state or regional broadband networks and services provided over those
networks…. In addition, the pilot program will provide funding to support the cost of connecting the state or
regional networks to Internet2."), id. at 11115, para. 14 (“The funding provided under this pilot program may be
used to fund up to 85% of the costs incurred by the applicants to . . . connect [its] network to Internet2”).
8

See generally Petition.

9

Id. at 6. A list of commenters is provided in the Attachment.

10

Wireline Competition Bureau Seeks Comment on the Petition for Reconsideration or, in the Alternative,
Clarification Filed By National LambdaRail, Inc., WC Docket No. 02-60, Public Notice, 21 FCC Rcd 13125 (2006).
11

See, e.g., Comments of the American Telemedicine Association, WC Docket No. 02-60 at 2-5 (filed Nov. 21,
2006); Comments of the University Corporation for Atmospheric Research, WC Docket No. 02-60 (filed Nov. 27,
2006); Comments of NetworkVirginia, WC Docket No. 06-20 (filed Nov. 28, 2006); Reply Comments of AT&T,
Inc., WC Docket No. 02-60 at 2-5 (filed Nov. 28, 2006); Reply Comments of NTCA, WC Docket No. 02-60 at 2
(filed Nov. 28, 2006).
12

See Comments of Internet2 Regarding National LambdaRail, Inc.’s Petition for Reconsideration or Clarification,
WC Docket No. 02-60 at 3-4 (filed Nov. 21, 2006); Letter from Michael M. Crow, President, Arizona State
University, to Marlene H. Dortch, Secretary, FCC, WC Docket No. 02-60 at 2 (filed Nov. 21, 2006).
13

See generally Petition; Comments of LEARN, WC Docket No. 02-60 (filed Nov. 28, 2006).

2

Federal Communications Commission

FCC 07-6

pilot program of NLR in addition to Internet2. 14 In reaching this conclusion, we emphasize that the pilot
program is limited in scope and is intended as a “trial program that will . . . inform our examination” of
how to effectively bring the benefits of broadband connectivity to health care providers and patients, and
is not intended as a permanent revision to the rural health care program. 15 Moreover, it is reasonable to
limit the pilot program to Internet2 and NLR. As noted in our initial Order, Internet2 is a non-profit
entity that already links a number of institutions, such as government research institutions and academic,
public and private health care providers that house significant medical expertise.16 Significantly, NLR is
also a non-profit entity that is connected to these types of institutions. Thus, it would provide similar
opportunities to pilot program applicants as Internet2 does. Moreover, supporting connections to NLR
would expand health care providers’ ability to access institutions that may be currently connected to only
one backbone or to otherwise address network or clinical needs unique to an applicant.17
6. The participation of more than one non-profit nationwide backbone provider would also
provide redundancy, which “will enhance the health care community’s ability to provide a rapid and
coordinated response in the event of a national crisis.”18 Indeed, as stated above, a number of health care
entities are already connected to NLR as well as to Internet2.19 Accordingly, in order to enhance public
safety and homeland security, we expect that Internet2 and NLR will facilitate the exchange of traffic
between their networks by establishing peering or other interconnection arrangements.20 Such
arrangements will also enhance the utility of the pilot program as a tool for examining the
communications needs of health care providers, as well as enhance health care providers’ access to the
infrastructure and the medical resources connected to these networks that are necessary to develop a
ubiquitous dedicated health care network. 21
7. We further allow applicants to either pre-select Internet2 or NLR, or to seek competitive bids
from NLR and Internet2 through the normal competitive bidding process. We find that allowing an
14

See Rural Health Care Pilot Program Order, 21 FCC Rcd at 11111, 11112, paras. 1, 4; but see Comments of
AT&T Inc., WC Docket No. 02-60 at 2 (filed Nov. 21, 2006) (advocating funding for all backbone providers);
Reply Comments of AT&T Inc., WC Docket No. 02-60 at 2 (filed Nov. 28, 2006) (same); Comments of NTCA, WC
Docket No. 02-60 at 4 (filed Nov. 21, 2006) (same).
15

Rural Health Care Pilot Program Order, 21 FCC Rcd at 11113, para. 9.

16

Rural Health Care Pilot Program Order, 21 FCC Rcd at 11111, para. 2.

17

See generally, Reply Comments of NLR, WC Docket No. 02-60 at 6, 10-15 (filed Nov. 28, 2006) (suggesting that
connections to Internet2 or NLR may fulfill different needs for different health care providers to access different
institutions); Comments of American Telemedicine Association, WC Docket No. 02-60 (filed Nov. 21, 2006)
(stressing that health care providers’ connectivity decisions are driven by the need to access a variety of clinical
services).
18

Rural Health Care Pilot Program Order at 11111, paras. 2, 4; See Reply Comments of NTCA, WC Docket No.
02-60 at 2 (filed Nov. 28, 2006).
19

See Petition at Attachment A; Comments of LEARN, WC Docket No. 02-60 (filed Nov. 28, 2006); Comments of
NetworkVirginia, WC Docket No. 02-60 (filed Nov. 28, 2006); Comments of National Center for Atmospheric
Research, WC Docket No. 06-20 (filed Nov. 27, 2006).
20

See Reply Comments of NLR, WC Docket No. 02-60 at 10-12 (filed Nov. 28, 2006) (suggesting that institutions
connected to NLR are already indirectly connected to Internet2, and that NLR has offered to peer with Internet2 in
the past); See also, Reply Comments of AT&T, Inc., WC Docket No. 02-60 at 3 (filed Nov. 28, 2006); Comments
of Internet2, WC Docket No. 02-60 at 10 (filed Nov. 21, 2006) (suggesting that institutions connected to NLR could
easily connect to Internet2).
21

See note 17, supra.

3

Federal Communications Commission

FCC 07-6

applicant to pre-select NLR or Internet2 will provide the applicant with an opportunity to more fully
develop the specific elements of its infrastructure proposal, particularly where only a specific non-profit
nationwide backbone provider will fulfill the applicant’s network plan or meet its need to access a
particular institution that is currently connected to only one nationwide network.22
8. For these reasons, where an applicant proposes to pre-select Internet2 or NLR, pursuant to
section 1.3 of the Commission’s rules, we waive, on our own motion, the rural health care program’s
competitive bidding and cost-effectiveness rules for pilot program applicants. 23 Alternatively, those
applicants who have not yet selected a backbone provider at the time of their applications may request
funding for such a connection and, if selected, seek bids through the established rural health care
competitive bidding mechanism by submitting the appropriate forms to the Universal Service
Administrative Company (USAC).24 We also remind applicants that regardless of whether they choose to
pre-select NLR or Internet2, pilot program participants will be subject to the Commission's audit
authority, and we emphasize that we retain the discretion to evaluate the activities of applicants and
determine on a case-by-case basis whether waste, fraud, or abuse has occurred and whether corrective
action is necessary.
9. Finally, in light of our decision here, we provide applicants with additional time to submit
their proposals to the Commission. In the Rural Health Care Pilot Program Order, the Commission
required that applications be filed with the Commission thirty (30) days from the date that the
Commission receives Office of Management and Budget (OMB) approval of the information collection
requirements contained in the Rural Health Care Pilot Program Order.25 In order to provide applicants
with sufficient time to consider this Order in formulating their proposals, we extend that deadline by
thirty (30) days for all applicants and require that proposals be submitted to the Commission sixty (60)
days from the receipt of OMB approval of the information collection requirements.
IV.

ORDERING CLAUSES

10. Accordingly, IT IS ORDERED that, pursuant to the authority contained in sections 1, 4(i),
4(j), 10, 201-205, 214, 254, and 403 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151,
154(i), 154(j), 160, 201-205, 214, 254, and 403, and section 1.106 of the Commission’s rules, 47 C.F.R. §
1.106, the Petition filed by National LambdaRail, Inc. on October 30, 2006, IS GRANTED to the extent
provided herein.

22

See note 17, supra.

23

As the Commission stated in the Rural Health Care Pilot Program Order, waivers may be necessary to effectuate
the purposes of the pilot program. See Rural Health Care Pilot Program Order, 21 FCC Rcd at 11117, para. 18.
The Commission may waive any provision of its rules on its own motion for good cause shown. 47 C.F.R. § 1.3. A
rule may be waived where the particular facts make strict compliance inconsistent with the public interest.
Northeast Cellular Telephone Co. v. FCC, 897 F.2d 1164, 1166 (D.C. Cir. 1990) (Northeast Cellular). In addition,
the Commission may take into account considerations of hardship, equity, or more effective implementation of
overall policy on an individual basis. WAIT Radio v. FCC, 418 F.2d 1153, 1157 (D.C. Cir. 1969), affirmed by WAIT
Radio v. FCC, 459 F.2d 1203 (D.C. Cir. 1972). In sum, waiver is appropriate if special circumstances warrant a
deviation from the general rule, and such deviation would better serve the public interest than strict adherence to the
general rule. Northeast Cellular, 897 F.2d at 1166; 47 C.F.R. § 1.3; 47 C.F.R. §§ 54.603, 54.603(b)(4), 54.615(a),
54.615(c)(7).
24

See 47 C.F.R. § 54.603; Rural Health Care Pilot Program Order, 21 FCC Rcd at 11117, para. 18.

25

Rural Health Care Pilot Program Order, 21 FCC Rcd at 11117, 11118, paras. 20, 24.

4

Federal Communications Commission

FCC 07-6

11. IT IS FURTHER ORDERED, pursuant to the authority contained in sections 1-4 and 254 of
the Communications Act of 1934, as amended, 47 U.S.C. §§ 151-154 and 254, and pursuant to section 1.3
of the Commission’s rules, 47 C.F.R. § 1.3, that sections 54.603, 54.603(b)(4), 54.615(a), and
54.615(c)(7) of the Commission’s rules, 47 C.F.R. §§ 54.603, 54.603(b)(4), 54.615(a), and 54.615(c)(7),
ARE WAIVED to the extent provided herein.
12. IT IS FURTHER ORDERED that applications to participate in the pilot program SHALL BE
FILED sixty (60) days from the receipt of OMB approval of the information collection requirements
contained in the Rural Health Care Pilot Program Order. The Commission will issue a public notice
announcing the date upon which the information collection requirements shall become effective following
receipt of such approval.
13. IT IS FURTHER ORDERED that, pursuant to section 408 of the Communications Act of
1934, as amended, 47 U.S.C. § 408, this Order SHALL BE EFFECTIVE upon release.

FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch
Secretary

5

Federal Communications Commission
APPENDIX
LIST OF COMMENTERS
American Telemedicine Association
Arizona State University
AT&T, Inc.
Internet2
University of Louisville
National Telecommunications Cooperative Association
LIST OF REPLY COMMENTERS
AT&T, Inc.
Florida LamdaRail (filed in CC Docket No. 02-6)
Healthcare Information and Management Systems Society (late filed)
Lonestar Education and Research Network
MAGPI Power Networking
National Center for Atmospheric Research
National LambdaRail, Inc.
National Telecommunications Cooperative Association
Network Virginia
Southern Crossroads

6

FCC 07-6