FCC's new Healthcare Connect Fund: Proceed with cautious optimism

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It's been a busy month at the Federal Communications Commission. While Congress and the Obama administration managed to muster legislation preventing the country from falling off the fiscal cliff, the FCC took concrete steps to reform and modernize its universal service program for healthcare.

Just before the Christmas break, the FCC issued an order transitioning the Commission's existing Internet Access and Rural Health Care Pilot Programs into a new Healthcare Connect Fund designed to expand healthcare provider access to broadband, especially in rural areas. And, just this week, the agency put its money behind its mouth, announcing that it will make available up to $400 million to healthcare providers in order to create and expand telemedicine networks nationwide.

This is a very encouraging development, given that the FCC has acknowledged that its existing Rural Health Care program, established by the 1996 Telecommunications Act, was "not effectively structured to expand the reach of broadband health care networks." In a previous column, I criticized the FCC's Rural Health Care Program for being another government initiative plagued by delays that has struggled to meet requirements that clearly were not defined from the outset.

Among the proof points in that editorial was a November 2010 Government Accountability Office report which found that the FCC "has not conducted an assessment of the telecommunications needs of rural healthcare providers as it has managed the primary Rural Health Care Program, which limits FCC's ability to determine how well the program has addressed those needs." In addition, government auditors charged that the FCC did not develop specific performance goals for the Rural Health Care Program and has developed "ineffective" performance measures.

The GAO recommended, among other things, that the Commission assess the communications needs of rural healthcare providers; consult with agencies and associations representing rural providers; develop effective goals, performance measures, and performance evaluation plans for current and future Rural Health Care programs; and clearly articulate rules governing any new programs.

With the launch of its new $400 million Healthcare Connect Fund, the FCC says that it now has addressed those concerns. In particular, the agency claims it put together a detailed assessment of healthcare provider needs for broadband capability in light of the current and future state of telemedicine. In addition, the FCC has adopted performance goals as "guideposts" in developing the Healthcare Connect Fund that it argues will enable the Commission to measure progress on the goals and performance measures. If the program is not meeting its performance goals, the FCC said it will consider corrective actions.

As a longtime observer of the FCC, I'm reserving judgment on the effectiveness of the Commission's reforms until we've actually had time to see them take effect. On the surface, it appears that the agency has taken the right steps that will help create positive results, but the proof of the pudding is in the eating. - Greg (@Slabodkin)