Changes to the Board of Directors of the National Exchange Carrier Association, Inc. and Federal-State Joint Board on Universal Service

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 54

[CC Docket Nos. 97-21 and 96-45; FCC 99-269]

Changes to the Board of Directors of the National Exchange

Carrier Association, Inc. and Federal-State Joint Board on Universal

Service

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: This document concerning the Changes to the Board of Directors

of the National Exchange Association, Inc. and Federal-State Joint

Board simplifies the process for rural health care providers to receive

support from the

[[Page 66779]]

universal service support mechanism, among other things, and adopts

rules to permit the Universal Service Administrative Company to provide

support for any commercially available telecommunications service,

regardless of the bandwidth. It also requires USAC to calculate support

based upon all actual distance-based charges, unless the rural health

care provider or carrier requests a more comprehensive support

calculation and substantiates that request.

DATES: Effective July 1, 2000.

FOR FURTHER INFORMATION CONTACT: Linda Armstrong, Assistant Division

Chief, Common Carrier Bureau, Accounting Policy Division, (202) 418-

7400.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Sixth

Order on Reconsideration in CC Docket No. 97-21, Fifteenth Order on

Reconsideration in CC Docket No. 96-45 released on November 1, 1999.

The full text of this document is available for public inspection

during regular business hours in the FCC Reference Center, Room CY-

A257, 445 Twelfth Street, S.W., Washington, D.C., 20554.

I. Introduction

1. In this Fifteenth Order on Reconsideration, we reconsider, on

our own motion, some of the Commission's conclusions in the Universal

Service Order, 62 FR 32862 (June 17, 1997), in order to simplify the

process for rural health care providers to receive support from the

universal service support mechanism. Specifically, we amend our rules

to permit the Universal Service Administrative Company (USAC) to

provide support for any commercially available telecommunications

service, regardless of the bandwidth. We further modify our rules to

require USAC to calculate support based upon all actual distance-based

charges, unless the rural health care provider or carrier requests a

more comprehensive support calculation and substantiates that request.

We affirm the conclusion reached in the Universal Service Order that,

despite the difficulties of allocating costs and preventing abuses, the

benefits of permitting rural health care providers to join consortia

with other subscribers of telecommunications service outweigh the

danger that such arrangements will lead to significant abuse of the

prohibition on resale. Accordingly, we clarify that new members may be

added to a consortium at any time after the rural health care provider

applies for universal service support, and we clarify our use of the

term ``tariffed or market rate'' to permit a rural health care provider

participating in a consortium with ineligible private sector members to

receive support. Finally, in order to achieve a more equitable

distribution of USAC's joint and common billing and collection costs,

we clarify that USAC should include these costs in the projected

administrative expenses of the high-cost, low-income, schools and

libraries, and rural health care programs, based upon the volume of

disbursements by each program.

II. Scope of Services Eligible for Support

A. Per-Location Funding Limit

2. We eliminate the per-location funding limit because it has made

it more difficult for rural health care providers to receive the

benefits of the rural health care support mechanism, and it is no

longer necessary to ensure that demand for support remains below the

$400 million per year cap that the Commission established in the

Universal Service Order. We believe that eliminating the per-location

funding limit will make it easier for rural health care providers to

select and receive support for the telecommunications services that

they need for telemedicine. We find that, even if USAC substantially

underestimated the demand for support by rural health care providers,

demand would still be well within the $400 million cap. Moreover, we

find that the Commission's initial decision to limit support to a T-1

or some combination of lesser services was driven by two express

concerns that are no longer relevant. We further find that, because the

per-location funding limit imposes some cost and generates no apparent

benefit, it would be contrary to the public interest to maintain it.

Accordingly, we conclude that the universal service support mechanism

for rural health care providers shall support any commercially

available telecommunications services, necessary for the provision of

health care services in a state, regardless of the bandwidth, and we

revise Sec. 54.613 of the Commission's rules to reflect this change.

3. Based upon the information in the record, we find that the

Commission's initial demand estimate was much too high. Section 254(g)

directs that universal service support mechanisms should be specific,

predictable, and sufficient. The only qualification, in section

254(h)(1)(A), of the type of telecommunications service that may be

supported is the requirement that the telecommunications service be

``necessary for the provision of health care services in a [s]tate.''

In order to establish a ``specific, predictable, and sufficient''

mechanism for a program with no track record, the Commission concluded

that it must limit the telecommunications services that a rural health

care provider may receive for the provision of health care services in

a state.

4. The Commission's original estimate for the cost of the program

predicted that maximum demand for support would be $366 million per

year. The Commission arrived at this conclusion without the benefit of

expert assessment of the cost of leaving rural health care providers

free to purchase whatever telecommunications services they deemed

necessary for the provision of health care. According to the USAC

Report, ``[t]he best current estimates show that this Program is not

likely to exceed $10 million in annual support level in the near

term.'' Specifically, the USAC Report estimates that the total demand

for support for rural health care providers will not exceed $3.1

million for the 18 month period from January 1, 1998 through June 30,

1999. USAC projects that the total demand for rural health care

provider support for the second funding year (July 1, 1999 through June

30, 2000) will be no more than $9.3 million. Although armed with a

significantly more comprehensive set of data than used in the Universal

Service Order, USAC estimates that, even if we remove the per-location

funding limit, demand would not exceed $10 million per year.

Apparently, as the Advisory Committee believed, the urban rates for

telecommunications services are costly enough to deter rural health

care providers from demanding excessive levels of telecommunications

service. USAC also reports that there are a number of other factors

that have served to reduce demand, which we discuss. Accordingly, we

conclude that, beginning with the third funding cycle, the universal

service support mechanism for health care providers will support all

commercially available telecommunications services necessary for the

provision of health care services, and that this expansion of eligible

telecommunications services will not increase demand beyond the funding

cap.

5. The Commission's initial decision to limit support to a T-1 or

some combination of lesser services was based upon two factors that are

now irrelevant, given that there is little risk of demand exceeding the

cap. First, the Commission's initial decision to limit support to a T-1

or some combination of lesser services was based in part upon

[[Page 66780]]

a finding that the record did not demonstrate that rural health care

providers would require higher bandwidths than T-1. Specifically, the

Commission found that the Advisory Committee and the majority of

commenters who recommended a specific level of telecommunications

bandwidth recommended a capacity of up to and including 1.544 Mbps or

its equivalent. The Advisory Committee and the majority of commenters

contended that rural health care providers did not need higher

bandwidths for the provision of health care services, and that the cost

of higher bandwidth connections would outweigh the benefits. It is

still unclear to us whether rural health care providers need services

with greater or lesser bandwidth than 1.544 Mbps for the provision of

health care. On the one hand, the Rural Utilities Service (RUS) argues

that the current supported bandwidth of 1.544 Mbps may be inadequate

because, with the rapid evolution of high-speed broadband networks

approaching the 1.544 Mbps capability, the medical community's needs

are expected to significantly exceed this level in the near future. On

the other hand, the National Rural Health Association (NRHA) asserts

that it appears that many telehealth applications are moving away from

dedicated point-to-point T-1 type services to switched, lower bandwidth

applications such as ISDN and POTs. Further, a letter jointly filed by

the American Telemedicine Association, the American College of Nurse

Practitioners, the Association of Telemedicine Service Providers, and

the NRHA states that:

The program should include discounts for all forms of

communications services when used in the delivery of health care to

rural health care providers. As currently designed, services

eligible for the rural health care program are effectively limited

to a T1 line, largely because of the use of distance costs

associated with this service. However, advancements over the past

few years in technology and communications have enabled health care

providers to transmit and receive information at speeds lower than

that required of T1 lines. Although lower in cost, this still

remains an impediment to many health providers due to the few

resources available in support of rural health care.

6. We, therefore, affirm our finding in the Universal Service Order

that rural health care providers are best able to determine what

telecommunications services best meet their needs; moreover, we find

that allowing rural health care providers to choose the transmission

speeds necessary for health care services in rural areas, outweigh our

need to determine with certainty the required bandwidth. Accordingly,

we conclude that, given that the per-location funding limit is not

necessary for keeping demand on the fund within the $400 million cap,

as long as the telecommunications services are necessary for health

care services in rural areas, there is little reason to ascertain

definitively whether rural health care providers need

telecommunications services with greater or lesser bandwidth than T-1.

7. The second reason that the Commission decided to support only

bandwidths up to 1.544 Mbps was because it agreed with the parties who

weighed the cost of higher services against the benefits and found that

the limited data suggested that the cost of higher bandwidths could

unnecessarily increase the cost of the program by a significant amount.

While very few respondents to the USAC Report Public Notice discussed

the cost of supporting higher services, the USAC Report suggests that

the cost of higher bandwidths would not unnecessarily increase the cost

of the program by a significant amount.

8. More importantly, it appears from the record, particularly the

USAC Report, that maintaining the current limits on services does not

adequately serve the public interest. That is, regardless of whether

rural health care providers need services with greater or lower

bandwidth, the public interest would be better served by allowing rural

health care providers to have affordable access to all modern

telecommunications services necessary to provide medical services. The

majority of interested parties in this proceeding assert that the per-

location funding limit imposed by the Commission's rules increases the

cost of participating in the program, while reducing the value of the

potential benefit that a rural health care provider may receive. For

example, USAC reports that one of the costs of the restriction is that

it discourages some rural health care providers from seeking services.

This is in part because of the complexity of securing some combination

of services of less than 1.544 bandwidth. Specifically, in May 1999,

USAC reported that ``calculation of the PLFL for each applicant to this

program has taken a significant amount of effort by carriers and RHCD

staff.'' Consistent with the findings reported by USAC, RUS asserts

that the Commission's rules significantly limit the value of the

support provided by the program.

9. Finally, we reject the argument by USTA that any change to the

Commission's rules that would expand the class of eligible services

would be inconsistent with the Act. Although USTA admits that the per-

location funding limit could be made simpler to administer, USTA argues

that the Commission should not expand the scope of eligible services

for the sole purpose of increasing demand to the level that we

previously anticipated would be reached. We agree with USTA that the

Commission should not expand the scope of eligible services solely for

the sake of increasing demand. Instead, we expand the scope of eligible

services because the current restrictions are in large part the result

of the per-location funding limit, and for the reasons discussed, we

now reject the per-location funding limit. The per-location funding

limit is not necessary to ensure that demand for support remains below

the $400 million per year cap. We find that demand will be sufficiently

limited by the statutory requirement that supported telecommunications

services must be necessary for the provision of health care. Moreover,

as previously discussed, we find that a rural health care provider is

ill served by our current rule, which further limits the rural health

care provider's choices to telecommunications services within

bandwidths up to and including 1.544 Mbps, and limits the total amount

of support that a rural health care provider can receive to the cost of

one T-1 connection. We believe that a rural health care provider may

under some circumstances need, for the provision of health care

services, telecommunications services with a higher bandwidth than

1.544 Mbps; a single service with a lesser bandwidth that requires more

support than a T-1; or a number of services with lesser bandwidth that

together require more support than one T-1. Accordingly, while we

recognize that removing the per-location funding limit will potentially

increase the amount of support for services that are already eligible

for support, and expand the list of eligible services, we conclude that

this result is consistent with the Act.

B. Long Distance Charges

10. Based upon the information in this record, we remain

unconvinced that the rural health care program should provide

additional support for long distance and toll charges, with the

exception of support for toll charges incurred by accessing an Internet

service provider (for those unable to secure toll-free Internet

access). We find that section 254(h)(1)(A) does not obligate

telecommunications carriers to deliver service to rural health care

providers at rates that are less than those

[[Page 66781]]

charged to urban health care providers. We note that section

254(h)(1)(A) directs telecommunications carriers to deliver service to

rural health care providers at rates that are reasonably comparable to

those charged to health care providers in urban areas of the state.

Further, we note that, although many of the commenters argue that using

long distance service makes it more expensive for rural health care

providers to engage in the practice of telemedicine, none have argued

that telecommunications carriers charge more for long distance service

provided to rural health care providers than for similar service

provided to urban residents. Based on the record before us, therefore,

we find no basis for providing additional support for long distance and

toll charges.

C. Urban/Rural Rate Calculation

11. In light of the entire record now before us, we determine that

most of the base rates for telecommunications service elements charged

to rural health care providers are already reasonably comparable to

those charged in urban areas. This position is consistent with USTA's

recommendation. Accordingly, we conclude that the Administrator need

not compare the tariffed or publicly available base rates for

telecommunications service elements to determine the amount of support

that it can provide for the benefit of a rural health care provider.

We, therefore, direct that, beginning with the third funding cycle, the

Administrator must calculate support based upon all actual distance-

based charges.

12. At the time that the rural health care program was established,

the Commission did not realize the extent to which directing the

parties to identify the highest tariffed or publicly available rate

actually being charged to urban customers, in order to set rates for

telecommunications services ``that are reasonably comparable to rates

charged for similar services in urban areas in that State,'' would

consume an unwarranted amount of resources for very little benefit. In

the Universal Service Order, the Commission specifically acknowledged

that most base rates for telecommunications services are averaged

across a state or study area, and concluded, therefore, that it is

often the distance-based charges that account for the difference

between the urban and rural rates charged to rural health care

providers. As a result, the Commission directed that, in addition to

providing rural health care providers with support for the difference

between the highest tariffed or publicly available rate actually being

charged to urban customers and the rate charged to the rural health

care providers (i.e. the base rates for telecommunications service

elements), the Administrator must also provide support for distance-

based charges. We have since learned that, because of the need to refer

to the various tariffs, calculating the difference between the urban

and rural base rates for telecommunications service elements is

extremely labor intensive. For many carriers and rural health care

providers, the cost of calculating the difference between the urban and

rural base rates for telecommunications service elements outweighs the

benefits of participating in the rural health care program, because it

is the distance charges that account for the rate differences of any

significance. For example, Alaska argues that FCC Forms 466 and 468

should be simplified because,

[r]equirements for detailed diagramming of circuits have proven

confusing and time-consuming to some LECs in Alaska. Rural health

care providers throughout the State have often encountered

complaints or resistance from telecommunications carriers with

respect to this task. Moreover, the information is also of

questionable value, particularly when the rate for the service

provided is not distance-sensitive.

Because the failure to properly calculate the difference between the

urban and rural base rates for telecommunications service elements must

be corrected by the Administrator, this activity has proven to be a

burden for the Administrator as well.

13. We, therefore, simplify the method for calculating support

found in Sec. 54.609 of the Commission's rules. Consistent with the

approach proposed by USTA in response to the USAC Report Public Notice,

we direct the Administrator to consider the base rates for

telecommunications services elements in rural areas to be reasonably

comparable to the base rates charged for similar telecommunications

service elements in urban areas in that state. The Administrator,

therefore, shall not include these charges in calculating support. In

addition, we direct the Administrator to treat a rural health care

provider as if it is located in the nearest large city in the state, in

the same manner as it does under the current rules. That is, if the

requested service distance is less than or equal to the SUD for the

state, the distance-based charge for that service can be no higher than

the distance-based charged for a similar service over the same distance

in the large city nearest to the rural health care provider. If the

requested service distance is greater than the SUD for the state, but

less than the maximum allowable distance, the distance-based charge for

that service can be no higher than the distance-based charged for a

similar service, transmitted the length of the SUD, in the large city

nearest to the rural health care.

14. Consistent with the approach proposed by USTA, we also conclude

that, in the event a rural health care provider or carrier can

establish that there is a difference between the urban and rural base

rates charged for a telecommunications service, the rural health care

provider or the telecommunications carrier may request a more

comprehensive rate comparability calculation consistent with the

Commission's current rules. We note that it would not be feasible for

the Administrator to document the tariffed or publicly available urban

rates for all commercially available telecommunications services to

establish a benchmark for comparison of the base rates of

telecommunications service elements. Consequently, in the rare instance

where there is a difference between the urban and rural base rates for

services, we require the rural health care provider or carrier to

provide the evidence thereof.

15. We do not modify our rules to require the Administrator to

deduct a standardized SUD from the total distance-based charge. We

believe that such an approach would generally result in establishing a

national SUD to calculate the support amount. We reject this approach

because the Administrator has already established the average of the

longest diameters of all cities with a population of 50,000 or more

within each state, and adding the state averages together to ultimately

arrive at a national SUD would not be as accurate as using each state's

SUD. We also reject this suggestion because we believe that it would

not result in rural health care providers paying distance-based charges

that are reasonably comparable to those required of urban subscribers

as required by section 254(h)(1)(A), since it would require a rural

health care provider to pay the balance of the distance-based charge.

We find that this balance would generally be more than urban

subscribers are required to pay.

16. We reject USAC's proposal to establish statewide average

discount percentages to apply to the rural base rates and/or distance

sensitive charges for eligible services. Section 254(h)(1)(A) requires

the Commission to adopt mechanisms designed to make telecommunications

services available to rural health care providers at rates reasonably

comparable to ``rates charged for similar services in urban

[[Page 66782]]

areas.'' As the Joint Board previously stated, however, use of an

average rate ``would entitle some rural customers to rates below those

paid by some urban customers, creating fairness problems for those

urban customers and arguably going farther with this mechanism than

Congress intended.''

D. Equipment

17. Section 254(h)(1)(A) does not authorize the provision of

universal service support for equipment needed by rural health care

providers to establish telemedicine programs. We note that section

254(h)(1)(A) directs telecommunications carriers to provide

telecommunications services to rural health care providers at a

discounted rate, and permits the telecommunications carriers to have

the amount of the discount treated as part of their obligation to

participate in the mechanisms to preserve and advance universal

service. There is nothing in section 254(h)(1)(A) that authorizes the

provision of universal service support for the purchase of equipment by

rural health care providers. Indeed, the Joint Explanatory Statement

indicates that Congress' intent was that ``the rural health care

provider receive an affordable rate for the services necessary for the

purposes of telemedicine and instruction relating to such services.''

Consistent with the Joint Explanatory Statement, USTA argues that it

would be inappropriate and unlawful to provide support for equipment,

or any other non-telecommunications service component of telemedicine.

RUS similarly opposes providing support to reduce the cost of any non-

telecommunications service expenses of telemedicine. RUS notes that

other federal programs, such as the RUS Distance Learning and

Telemedicine Loan and Grant Program are available to assist with the

financing of end-user hardware and facilities used in telemedicine

projects. Under these circumstances, we conclude that the rural health

care support mechanism cannot assist in reducing the cost of the

equipment necessary for rural health care providers to provide

telemedicine services.

E. Insular Areas

18. Because we still lack sufficient information to ensure that

health care providers located in the insular areas have access to the

telecommunications services available in urban areas in the country at

affordable rates, on August 5, 1999, the Commission adopted the

Unserved, Tribal, and Insular Areas FNPRM, 64 FR 52738 (September 30,

1999), seeking public input on these and many related issues. We note

that the record here contains insufficient information about the status

and availability of health care services and telemedicine in most of

the insular areas.

19. We are concerned that, to the extent that section 254(h)(1)(A)

was intended solely to help equalize the rates paid by residents of

urban and rural areas within a state, the Commission would be

constrained in its ability to provide relief to rural health care

providers in the insular areas. We note that Congress could have

provided discounts on the telecommunications service that rural health

care providers use to connect to the nearest major urban hospital

within or outside the state when rural health care providers rely on

such hospitals for consultations. This approach would have directed

assistance to rural health care providers hindered by the high costs of

linking to major hospitals they need to reach outside of their states.

Moreover, the Act could have sought to equalize rates paid by rural

health care providers in different states, ensuring that no rural

health care provider paid significantly more than hospitals in the

largest urban areas, regardless of state boundaries. The language of

section 254(h)(1)(A), however, merely directs the Commission to provide

universal service support to rural health care providers to enable them

to pay rates similar to those paid in urban areas of their states.

20. On the other hand, we have always recognized that our method

for determining the amount of support that a rural health care provider

may receive is ill suited to insular areas. In the Universal Service

Order, for example, we noted that ninety-five percent of American

Samoa's population of 56,000 lives on the island of Tutuila, where the

territory's single hospital is located. Since we designated Tutuila as

an urban area for purposes of setting the urban rate, rural health care

providers in American Samoa will be constrained in their ability to

take full advantage of the benefits of the rural health care support

mechanism.

21. The Commission concluded in the Universal Service Order that

section 254(h)(2)(A) authorizes the Commission to adopt special

mechanisms to calculate support for the insular areas. Section

254(h)(2)(A) directs the Commission, in part, to establish

competitively neutral rules ``to enhance, to the extent technically

feasible and economically reasonable, access to advanced

telecommunications . . . services for all public and nonprofit . . .

health care providers.'' In order to implement the statute's

directives, among other things, we need to identify the necessary

services and determine what is ``technically feasible and economically

reasonable.'' That is, we need additional data about the specific needs

of insular areas in this context, as well as the estimated cost of

providing such support for those needs. We also note that, were we to

grant support for links between rural health care providers in insular

areas and the nearest advanced health care facilities in some other

jurisdiction, we would need to set standards for identifying such

facilities. We would also need to ensure that such rules would not be

inconsistent with state physician licensing requirements that might

preclude a rural health care provider from establishing a telemedicine

connection with an advanced facility in the nearest large city in

another state. Consequently, we encourage interested parties to submit

their comments in the Unserved, Tribal, and Insular Areas FNPRM

proceeding that we initiated on August 5, 1999, as we will be

addressing these issues in the near future.

III. Eligibility of Health Care Providers

A. Definition of Health Care Provider

22. We affirm our initial conclusion that section 254(h)(5)(B)

adequately describes those entities Congress intended to be eligible

for universal service support. We find that, given the specific

categories of health care providers listed in section 254(h)(5)(B), if

Congress had intended to include nursing homes, hospices, or other

long-term care facilities, and emergency medical service facilities, it

would have done so explicitly. Thus, we find that the definition of

``health care provider'' does not include nursing homes, hospices, or

other long-term care facilities, and emergency medical service

facilities.

23. Moreover, we clarify that a rural nursing home is ineligible to

receive universal service support from the rural health care support

mechanism, whether or not it is part of a not-for-profit hospital or

rural health clinic. We are not persuaded that an entity omitted from

the list in the statute should be allowed to apply for and receive the

benefits of the program directly from the universal service support

mechanism simply because of the relationship between the ineligible and

eligible entity. Moreover, we find no rational basis for distinguishing

between a rural nursing home that is part of a not-for-profit hospital

or rural health clinic and a rural nursing home that is associated with

any of the other categories of

[[Page 66783]]

eligible entities listed in the statute. Finally, we believe that

allowing nursing homes to receive support directly from the rural

health care support mechanism based upon their association with

eligible entities would very likely result in a flood of other types of

ineligible entities requesting similar treatment, and thus would render

meaningless the limitations imposed by Congress in section

254(h)(5)(B). We find, therefore, that, to the extent that the

instructions for the current version of the FCC Form 465 state that

nursing homes that are ``part of a not-for-profit hospital or rural

health care clinic'' are health care providers eligible to receive

support, those instructions are incorrect.

B. Restrictions on Resale and Aggregated Purchases

24. We affirm the conclusion that we reached in the Universal

Service Order that, despite the difficulties of allocating costs and

preventing abuses, the benefits of permitting rural health care

providers to join consortia with other subscribers of

telecommunications service outweigh the danger that such arrangements

will lead to abuse of the prohibition on resale. Accordingly, we

clarify that new members may be added to a consortium at any time after

the rural health care provider applies for universal service support.

We note that the Commission's rules do not restrict a rural health care

provider's ability to join a consortium with other eligible health care

providers, or public sector governmental entities (such as schools and

libraries). The Commission's rules also do not restrict a rural health

care provider's ability to continue to participate in a consortium to

which any of the above are added after the rural health care provider

applies for universal service support. The Commission's rules limit a

rural health care provider's ability to receive universal service

support only if the consortium includes a private sector entity.

Section 54.601(b) of the Commission's rules state that, in the event

that a consortium includes a private sector entity, a rural health care

provider may receive support only if the consortium is paying tariffed

or market rates for the subject services. We believe that our

interpretation is consistent with both the section 254(h)(1)(A)

requirement to ensure that health care providers located in rural areas

have access to telecommunications services at rates available to urban

residents, and the section 254(h)(3) prohibition against the sale,

resale, or other transfer of supported services for money.

25. We also clarify that a tariffed or market rate received by a

consortium of eligible and ineligible entities may include a volume

discount, or otherwise reflect consideration of the unique

characteristics of the subscribers, to the extent that characteristic

is not a rural health care provider's eligibility to receive support

from the rural health care program. This is because the Commission's

restriction on consortium membership was intended to prohibit

ineligible private entities from receiving the benefits of the rural

health care support mechanism. The Universal Service Order clearly

states that the Commission and the Joint Board supported broad-based

participation in consortia and intended to encourage their growth. The

Commission explained, in the Universal Service Order, that this

restriction is necessary to ``deter ineligible, private entities from

entering into aggregated purchase arrangements with rural health care

providers to receive below-tariff or below-market rates that they

otherwise would not be entitled to receive.'' We find that an

ineligible private entity that enters into an aggregated purchase

arrangement with a rural health care provider, and receives a tariff or

market rate that includes a volume discount, would not be receiving a

below-tariff or below-market rate because of the eligibility status of

a rural health care provider participating in the consortium. We,

therefore, find that such an arrangement would not violate our rules,

as long as entities and individuals not eligible for universal service

support pay the full contract rates for their portion of the services.

26. The section of the Universal Service Order that addresses the

universal service support mechanism for schools and libraries offers an

additional reason for the Commission's restriction on consortium

membership, which would not be contradicted by the finding. In the

section of the Universal Service Order that discusses the universal

service support mechanism for schools and libraries, the Commission

noted that it was concerned that ``permitting large private sector

firms to join with eligible schools and libraries to seek prices below

tariffed rates could compromise both the federal and state policies of

non-discriminatory pricing.'' The Commission found congressional

support for permitting eligible schools and libraries to secure prices

below tariffed rates, and no basis for extending that exception to

enable all private sector firms to secure such prices. The Commission

concluded that eligible schools and libraries would generally qualify

for universal service discounts and prices below tariffed rates for

interstate services, only if any consortia they join include only other

eligible schools, libraries, rural health care providers, and public

sector customers. Although the Universal Service Order does not define

the term ``tariffed rates,'' the definition of the term ``pre-discount

price,'' and the explanation of the Commission's intent in the schools

and libraries section of the Universal Service Order is instructive in

determining whether permitting a consortium of eligible and ineligible

entities to obtain tariff rates that include a volume discount could

compromise the policies of non-discriminatory pricing. The Universal

Service Order defines pre-discount price as the price of services to

schools and libraries prior to the application of a discount from the

universal service support mechanism. It is ``the total amount that

carriers will receive for the services they sell to schools and

libraries: the sum of the discounted price paid by a school or library

and the discount amount that the carrier can recover from universal

service support mechanisms for providing such services.'' The Universal

Service Order explains:

Although consortia-negotiated prices might commonly be

characterized as ``discounted prices,'' because they are lower than

the prices that individual members of the consortia would be able to

secure on their own, we still characterize them as ``pre-discount

prices'' for the purposes of section 254(h) because they are the

prices eligible schools and libraries could obtain even without

application of the relevant universal service support discounts. All

members of such consortia, including those ineligible for universal

service support, would benefit from these lower ``pre-discount''

prices produced by such statewide, regional, or large group

contracts. . . . While those consortium participants ineligible for

support would pay the lower pre-discount prices negotiated by the

consortium, only eligible schools and libraries would receive the

added benefit of universal service discount mechanisms.

It is clear from this statement that the Commission's intent as

expressed in both the rural health care and schools and libraries

sections of the Universal Service Order is the same; to wit, to ensure

that only eligible entities receive the benefit of the universal

service support mechanism, not to prohibit a consortium from taking

advantage of the tariff or other publicly available rates that reflect

the economies of scale. Accordingly, we conclude that it would not

violate section 254, or compromise Federal and state policies of non-

discriminatory pricing to permit a rural health care provider to

benefit from the

[[Page 66784]]

rural universal service support mechanism, where the rural health care

provider is a member of a consortium of eligible and ineligible

entities receiving service at tariffed or other publicly available

rates that include a volume discount.

27. The fact that the Commission's rules prohibit a rural health

care provider from receiving support if it is in a consortium that

includes private sector members, unless the consortium is receiving

tariffed rates or market rates, has apparently largely been erroneously

interpreted as requiring the consortium members to be paying rates that

do not include volume discounts. As a result, commenters such as the

Rural Telecommunications Policy Working Group (RTP) and the Health Care

Systemic Change Initiative (HCSCI) believe that the Commission's

treatment of consortia discourages community-based telecommunications

facilities. Consequently, they request that the Commission generally

encourage the community use of telecommunications service facilities

that the rural health care providers use for telemedicine. Similarly,

RUS argues that community use should be allowed because it is not

resale.

28. We find that, to the extent that the Commission's exception is

being narrowly interpreted as requiring a rural health care provider in

a consortium with ineligible private entities to receive rates that do

not include a volume discount, the interpretation largely defeats the

purpose of participating in a consortium, and, therefore, is

inconsistent with our intention to encourage participation in

consortia. OAT and NTIA provide ample justification for rejecting the

narrow interpretation of the terms ``tariffed rates'' and ``market

rates.'' OAT and NTIA indicate that together they support over 400

rural telemedicine sites in the United States, and about ninety percent

of those sites organize their networks into formal and informal

consortia to achieve greater economic efficiency. They further indicate

that the consortium typically includes an urban ``hub'' site such as a

medical college, urban hospital, medical center, or state governmental

unit associated with several small rural ``spoke'' sites. According to

OAT and NTIA, many rural health care providers use telecommunication

infrastructures established and maintained by the ``hub'' site. We are

not convinced that requiring a consortium to receive tariffed or market

rates should mean that the rate cannot take volume into consideration,

and reflect the economies of scale. We believe that a better

interpretation is one that recognizes that there are tariffed and

market rates that include volume discounts, just as there are tariffed

and market rates that recognize the unique characteristics of other

subscribers of telecommunications service. Consequently, we conclude

that entities not explicitly eligible for support cannot gain

eligibility for support by participating in consortia with those that

are eligible, but every member of the consortium may receive the

benefits otherwise available to them in tariffed or other publicly

available rates without jeopardizing a rural health care provider's

eligibility to receive the benefits of the rural health care support

mechanism.

29. Because of the difficulties of allocating costs and preventing

abuses, we also find that, in addition to telecommunications carriers,

health care providers and consortia of health care providers must share

in the responsibility for calculating and justifying the request for

support by maintaining documentation of the amount of support for which

each member of a consortium is eligible. Health care providers and

consortia of health care providers must also carefully maintain

complete records of how they allocate the costs of shared facilities

among consortium participants in order to charge eligible health care

providers the correct amounts. Accordingly, we revise Sec. 54.601 of

the Commission's rules to extend the record-keeping requirement to

health care providers and consortia of health care providers. Finally,

to the extent that a telecommunications carrier will not be applying

the discount directly to a billing telephone number in the name of the

rural health care provider, the rural health care provider and the lead

member of the consortium must certify to the proper disposition of the

benefits of the rural health care support mechanism.

30. Based upon the information in the record, we also clarify that

it is not necessary to set a time limit for rural health care providers

to report the identities of all of the consortia participants in order

to enforce the statutory prohibition against the resale of

telecommunications services by rural health care providers, or to

otherwise ensure that the support provided by the rural health care

universal service support mechanism is used for the purposes intended

by Congress. We find that USAC should permit a rural health care

provider to add new consortium members by submitting a new form 465

that the Administrator will use to re-evaluate the eligibility of the

rural health care provider. The rural health care provider must satisfy

anew the competitive bidding requirements only if the addition of a new

consortium member would be more than a minor change in the contract or

other arrangement for service from the carrier. Consistent with the

Fourth Reconsideration Order, a rural health care provider must look to

state or local procurement laws and regulations to determine whether a

proposed contract modification would be considered minor, and,

therefore, exempt from state or local competitive bid processes. If a

proposed modification would be exempt from state or local competitive

bid requirements, the applicant would not be required to undertake an

additional competitive bid process in connection with the applicant's

request to add a new member to the consortium. Similarly, if a proposed

modification would have to be re-bid under state or local competitive

bid requirements, then the applicant would also be required to comply

anew with the Commission's universal service competitive bid

requirements in order to be eligible to receive the benefits of the

rural health care program. Consistent with the Fourth Reconsideration

Order, 63 FR 2093 (January 13, 1998), where state and local procurement

laws and regulations are silent, or otherwise inapplicable with respect

to whether a proposed contract modification must be re-bid under state

or local competitive bid processes, the Commission will look to the

``cardinal change doctrine'' to determine whether the contract

modification requires re-bidding. The ``cardinal change doctrine''

generally examines the extent to which a modification exceeds the scope

of the original contract. We understand that USAC might prefer that

rural health care providers list all possible participants in their

initial applications, thus, permitting USAC to evaluate all

participants at once. We, however, are not persuaded that the

administrative difficulties are so great as to warrant restricting

joint purchasing and network-sharing arrangements.

IV. Administration

A. Billing and Collection

31. Consistent with the USAC Report, we direct USAC to include its

joint and common billing and collection costs in the projected

administrative expenses of the high cost, low-income, schools and

libraries, and rural health care programs, based upon the volume of

disbursements by each program, beginning January 1, 2000. We agree with

USAC that, in order to ensure a fair and accurate allocation of billing

and

[[Page 66785]]

collection costs among the four support mechanisms, it is better to use

an allocator that takes into account the actual size of the programs.

The Commission did not know, in 1997, the actual size of the individual

programs, or the extent of the difference in their sizes. Based upon

the information in the record, we find that there is no longer any

rational basis for requiring the rural health care program to be

responsible for twenty-five percent of the joint and common billing and

collection costs in question. We further find that continuing to

include one-fourth of USAC's joint and common billing and collection

costs in the projected administrative expenses of the rural health care

program would place a disproportionate burden on the rural health care

support mechanism.

B. Consolidation of Support Mechanisms

32. Consistent with the USAC Reorganization Order, we conclude

that, where efficiencies can be achieved, USAC should consolidate the

functions and operations that are common to the administration of all

three universal service support mechanisms. We decline, however, to

further direct the consolidation of any additional specific functions

and operations at this time. There is very little information in the

record upon which to base any decision to further consolidate

additional functions of the various universal service support

mechanisms. Although both the schools and libraries, and rural health

care programs have completed their first funding cycle, there will be

enough changes to the rural health care program as a result of this

Order, that the rural health care program will, in essence, be

repeating its first program year. We believe that, under these

circumstances, not only would it be difficult to identify with any

certainty the division with which we should merge RHCD, we find that

there would be little benefit to merging RHCD with any of the other

divisions of USAC while RHCD is undergoing significant change.

Moreover, as we indicated in the USAC Reorganization Order, we will

review USAC's performance after one year from the merger to assess

whether USAC has succeeded in eliminating duplicative functions, and

whether it has succeeded in preserving the distinct missions of the

schools and libraries, and rural health care support mechanisms. Given

that it has been less than one year since the merger, we conclude that

it would be premature to further direct the consolidation of additional

functions and operations that are common to the administration of the

support mechanisms.

V. Supplemental Final Regulatory Flexibility Analysis

33. In compliance with the Regulatory Flexibility Act (RFA), this

Supplemental Final Regulatory Flexibility Analysis (SFRFA) supplements

the Final Regulatory Flexibility Analysis (FRFA) included in the

Universal Service Order only to the extent that changes to that Order

adopted herein on reconsideration require changes in the conclusions

reached in the FRFA. As required by 603 RFA, 5 U.S.C. 603, the FRFA was

preceded by an Initial Regulatory Flexibility Analysis (IRFA)

incorporated in the Notice of Proposed Rulemaking and Order

Establishing the Joint Board (NPRM), and an IRFA, prepared in

connection with the Recommended Decision, which sought written public

comment on the proposals in the NPRM and the Recommended Decision.

34. Need for and Objective of this Order. The Commission is

required by section 254 of the Act to promulgate rules to implement

promptly the universal service provisions of section 254. On May 8,

1997, the Commission adopted rules whose principle goal is to reform

our system of universal service support mechanisms so that universal

service is preserved and advanced as markets move toward competition.

In this Order, we reconsider two aspects of those rules and clarify one

aspect of those rules. First, we direct USAC to provide support for any

commercially available telecommunications service necessary for health

care in rural areas, regardless of the bandwidth. Second, we find that

the Administrator need not compare the tariffed or publicly-available

base rates for telecommunications service elements to ensure that rural

health care providers are receiving rates that are reasonably

comparable to those in urban areas, and we direct the Administrator to

calculate support based upon all actual distance-based charges.

Finally, we clarify that new members may be added to a consortia at any

time after the rural health care provider applies for universal service

support. We also conclude that, a rural health care provider

participating in a consortium with eligible private sector members may

receive support, even if the consortium is receiving a tariffed or

market rate that includes a volume discount. Because of the

difficulties of allocating costs and preventing abuses, we find that,

in addition to telecommunications carriers, health care providers, and

consortia of health care providers must share in the responsibility for

calculating and justifying the request for support by maintaining

documentation of the amount of support for which each member of a

consortium is eligible.

35. Summary and Analysis of the Significant Issues Raised by Public

Comments in Response to the IRFA. In this Order, the Commission

simplifies the process for rural health care providers to receive

support from the universal service support mechanism. The Commission

reconsiders, on its own motion, the rules that define the services that

are eligible for support, and clarifies the definition of the entities

eligible to receive the benefits of that support. In addition, the

Commission clarifies the rules associated with the administration of

the universal service support mechanisms. Specifically, the Order

modifies the rules to allow the universal service mechanism for rural

health care providers to support any commercially available

telecommunications service regardless of the bandwidth, and allow the

Administrator to calculate support based solely upon all actual

distance-based charges. The Order clarifies the rules to allow a rural

health care provider participating in a consortium with ineligible

private sector members to be able to receive support even if the

consortium is receiving a tariffed or market rate that includes a

volume discount. It also clarifies the rules to enable USAC to include

its joint and common billing and collection costs in the projected

administrative expenses of the high cost, low-income, schools and

libraries, and rural health care programs, based upon the volume of

disbursements by each program.

36. Description and Estimates of the Number of Small Entities to

Which the Rules Adopted in This Order Will Apply. The RFA directs

agencies to provide a description of and, where feasible, an estimate

of the number of small entities that may be affected by the proposed

rules, if adopted. The RFA generally defines the term ``small entity''

as having the same meaning as the terms ``small business,'' ``small

organization,'' and ``small governmental jurisdiction.'' In addition,

the term ``small business'' has the same meaning as the term ``small

business concern'' under the Small Business Act. A small business

concern is one which: (1) Is independently owned and operated; (2) is

not dominant in its field of operation; and (3) satisfies any

additional criteria established by the Small Business Administration

(SBA). A small organization is generally ``any not-for-profit

enterprise which is independently

[[Page 66786]]

owned and operated and is not dominant in its field.''

37. In the FRFA of the Universal Service Order, we estimated and

described in detail the number of small entities that might be affected

by the new universal service rules. The rules adopted in this Order,

however, would affect primarily rural health care providers.

Specifically, the Commission modifies the rules that define the

services that are eligible for support. Health care providers will now

receive universal service support for any commercially available

telecommunications services, necessary for the provision of health care

services in a state, regardless of the bandwidth. The Commission also

revises the rules that calculate support based on the urban/rural rate.

Rural health care providers' universal service support will now be

calculated using actual distance-based charges. Finally, the Commission

clarifies the rules that define limitations on supported services for

rural health care providers. Rural health care providers are allowed to

participate in a consortium with ineligible private sector members and

will be able to receive support even if the consortium is receiving a

tariffed or market rate that includes a volume discount. The adopted

rules will allow rural health care providers to benefit more fully from

the rural health care universal service support mechanism, constituting

a positive economic impact on these small entities.

38. As noted, small entities includes ``small businesses,'' ``small

organizations,'' and ``small governmental jurisdictions.'' All three

types of small entities may also constitute rural health care providers

for the purpose of this analysis. ``Small governmental jurisdiction''

generally means ``governments of cities, counties, towns, townships,

villages, school districts, or special districts, with a population of

less than 50,000.'' As of 1992, there were approximately 85,006 such

jurisdictions in the United States. This number includes 38,978

counties, cities, and towns; of these, 37,566, or 96 percent, have

populations of fewer than 50,000. The Census Bureau estimates that this

ratio is approximately accurate for all governmental entities. Thus, of

the 85,006 governmental entities, we estimate that 81,600 (91 percent)

are small entities. As for ``small organizations,'' as of 1992, there

were approximately 275,801.

39. In addition, the Commission noted in the Universal Service

Order that neither the Commission nor the SBA has developed a

definition of small, rural health care providers. Section 254(h)(5)(B)

defines the term ``health care provider'' and sets forth the seven

categories of health care providers eligible to receive universal

service support. We estimated that there is less than 12,296 health

care providers potentially affected by the rules in the Universal

Service Order. We note that these small entities may potentially be

affected by the rules adopted in this Order.

40. Summary Analysis of the Projected Reporting, Record keeping,

and Other Compliance Requirements and Significant Alternatives. In the

FRFA to the Universal Service Order, we described the projected

reporting, record keeping, and other compliance requirements and

significant alternatives associated with the Schools and Libraries

section, the Rural Health Care Provider section, and the Administration

section of the Universal Service Order. Because the rules adopted

herein may only affect those requirements in a marginal way, we

incorporate by reference paragraphs 956 through 960, 968 through 971,

and 980 of the Universal Service Order, which describe those

requirements and provide the following analysis of the new requirements

adopted herein.

41. Under the rules adopted herein, we revise the rules governing

the eligibility of services that the universal service support

mechanism will support. We find that regardless of whether rural health

care providers need services with greater or lower bandwidths, the

public interest would be better served by allowing rural health care

providers to have affordable access to all modern telecommunications

service to provide medical services without regard for the bandwidth

thereof. We also revise the rules to allow the Administrator to

calculate the support based upon all distance-based charges. We've

learned that because of the need to refer to the various tariffs,

calculating the difference between the urban and rural base rates for

telecommunications is extremely labor intensive. We have determined

that most of the base rates for telecommunications service elements

charged to rural health care providers are already comparable to those

charged in urban areas so there is no need to continue to require the

comparison of tariffs to other publicly available rates. Finally, we

revise the rules to show that a rural health care provider

participating in a consortium with ineligible private sector members

may receive support even if the consortium is receiving a tariffed or

market rate that includes a volume discount. We find that, an

ineligible private entity that enters into an aggregated purchase

agreement with a rural health care provider, and receives a tariff or

market rate that includes a volume discount, would not be receiving a

below-tariff or below-market rate because of the eligibility status of

a rural health care provider participating in the consortium. We also

find that new members may be added to a consortium even after the rural

health care provider submits it application for support. Finally,

because of the difficulties of allocating costs and preventing abuses

in consortium arrangements, we find that, in addition to

telecommunications carriers, health care providers and consortia of

health care providers must maintain documentation of the amount of

support for which each member of a consortium is eligible. These

changes will not have a significant impact on the reporting, record

keeping, and other compliance requirements for participation in the

rural health care support program.

42. Steps Taken To Minimize the Significant Economic Impact on a

Substantial Number of Small Entities Consistent With Stated Objectives.

In the FRFA to the Universal Service Order, we described the steps

taken to minimize the significant economic impact on a substantial

number of small entities consistent with stated objectives associated

with the Schools and Libraries section, the Rural Health Care Provider

section, and the Administration section of the Universal Service Order.

Because the rules adopted herein may only affect those requirements in

a marginal way, we incorporate by reference paragraphs 961 through 967,

972 through 976, and 981 through 982 of the Universal Service Order,

which describe those requirements and provide the following analysis of

the new requirements adopted herein.

43. Our decision to simplify the process for rural health care

providers to receive support from the universal service support

mechanism, will benefit rural health care providers, as well as their

chosen service providers, who may be small entities. We also find that

this approach should permit all parties to use fewer resources (i.e.

less time and labor) to access the benefits of the universal service

support program.

VI. Ordering Clauses

44. The authority contained in 1-4, 201-205, 218-220, 254, 303(r),

403, and 405 of the Communications Act of 1934, as amended, 47 U.S.C.

151-154, 201-205, 218-220, 254, 303(r), 403, and 405, Sec. 1.108 of the

Commission's rules, 47

[[Page 66787]]

CFR 1.108, the Fifteenth Order on Reconsideration is adopted.

45. The authority contained in 1-4, 201-205, 218-220, 254, 303(r),

403, and 405 of the Communications Act of 1934, as amended, 47 U.S.C.

151-154, 201-205, 218-220, 254, 303(r), 403, and 405, Sec. 1.108 of the

Commission's rules, 47 CFR 1.108, Part 54 of the Commission's rules, 47

CFR Part 54, are amended.

46. This Fifteenth Order on Reconsideration, the rule changes set

forth are effective beginning with the third funding cycle of the rural

health care universal service support program.

47. The Commission's Office of Public Affairs, Reference Operations

Division, shall send a copy of this Fifteenth Order on Reconsideration,

including the Supplemental Final Regulatory Flexibility Analysis, to

the Chief Counsel for Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Part 54

Universal service.

Federal Communications Commission.

Magalie Roman Salas,

Secretary.

Rule Changes

Part 54 of Title 47 of the Code of Federal Regulations is amended

as follows:

PART 54--UNIVERSAL SERVICE

1. The authority for part 54 continues to read as follows:

Authority: 47 U.S.C. 1, 4(i), 201, 205, 214, and 254 unless

otherwise noted.

2. Amend Sec. 54.601 by revising paragraphs (b)(3), (b)(4), and

(c)(1) to read as follows:

Sec. 54.601 Eligibility.

* * * * *

(b) * * *

(3) Telecommunications carriers, health care providers, and

consortia of health care providers shall carefully maintain complete

records of how they allocate the costs of shared facilities among

consortium participants in order to charge eligible health care

providers the correct amounts. Such records shall be available for

public inspection.

(4) Telecommunications carriers, health care providers, and

consortia of health care providers shall calculate and justify with

supporting documentation the amount of support for which each member of

a consortium is eligible.

(c) * * *

(1) Any telecommunications service that is the subject of a

properly completed bona fide request by a rural health care provider

shall be eligible for universal service support, subject to the

limitations described in this paragraph. The length of a supported

telecommunications service may not exceed the distance between the

health care provider and the point farthest from that provider on the

jurisdictional boundary of the nearest large city as defined in

Sec. 54.605(c).

* * * * *

3. Amend Sec. 54.609 by adding paragraphs (a)(1), (a)(2), and by

revising paragraphs (b) and (c) to read as follows:

Sec. 54.609 Calculating support.

(a) * * *

(1) With one exception, the Administrator shall consider the base

rates for telecommunications services elements in rural areas to be

reasonably comparable to the base rates charged for similar

telecommunications service elements in urban areas in that state, and,

therefore, the Administrator shall not include these charges in

calculating the support. The Administrator shall include, in the

support calculation, all other charges specified, and all actual

distance-based charges as follows:

(i) If the requested service distance is less than or equal to the

SUD for the state, the distance-based charge for that service can be no

higher than the distance-based charged for a similar service over the

same distance in the large city nearest to the rural health care

provider;

(ii) If the requested service distance is greater than the SUD for

the state, but less than the maximum allowable distance, the distance-

based charge for that service can be no higher than the distance-based

charged for a similar service in the large city nearest to the rural

health care provider over the SUD.

(iii) ``Distance-based charges'' are charges based on a unit of

distance, such as mileage-based charges.

(iv) Except with regard to services provided under Sec. 54.621, a

telecommunications carrier that provides telecommunications service to

a rural health care provider participating in an eligible health care

consortium, and the consortium must establish the actual distance-based

charges for the health care provider's portion of the shared

telecommunications services.

(2) If a telecommunications carrier, health care provider, and/or

consortium of health care providers reasonably determines that the base

rates for telecommunications services elements in rural areas are not

reasonably comparable to the base rates charged for similar

telecommunications service elements in urban areas in that state, the

telecommunications carrier, health care provider, and/or consortium of

health care providers may request that the Administrator perform a more

comprehensive support calculation. The requester shall provide to the

Administrator the information to establish both the urban and rural

rates consistent with Sec. 54.605 and Sec. 54.607, and submit to the

Administrator all of the documentation necessary to substantiate the

request.

(i) Except with regard to services provided under Sec. 54.621, a

telecommunications carrier that provides telecommunications service to

a rural health care provider participating in an eligible health care

consortium, and the consortium must establish the applicable rural base

rates for telecommunications service elements for the health care

provider's portion of the shared telecommunications services, as well

as the applicable urban base rates for the telecommunications service

elements.

(b) Absent documentation justifying the amount of universal service

support requested for health care providers participating in a

consortium, the Administrator shall not allow telecommunications

carriers to offset, or receive reimbursement for, the amount eligible

for universal service support.

(c) The universal service support mechanisms shall provide support

for intrastate telecommunications services, as set forth in Sec. 54.101

paragraph (a), provided to rural health care providers as well as

interstate telecommunications services.

4. Revise Sec. 54.613 to read as follows:

Sec. 54.613 Limitations on supported services for rural health care

providers.

(a) Upon submitting a bona fide request to a telecommunications

carrier, each eligible rural health care provider is entitled to

receive the most cost-effective, commercially-available

telecommunications service at a rate no higher than the highest urban

rate, as defined in this paragraph, at a distance not to exceed the

distance between the eligible health care provider's site and the

farthest point from that site that is on the jurisdictional boundary of

the nearest large city, as defined in Sec. 54.605(c).

(b) This section shall not affect a rural health care provider's

ability to obtain supported services under Sec. 54.621.

[FR Doc. 99-30989 Filed 11-29-99; 8:45 am]

BILLING CODE 6712-01-P