Chairman Pai Proposes Funding Increase for Rural Health Care Program

Federal Communications Commission Chairman Ajit Pai announced that he has circulated a draft order to his colleagues that would take immediate action to significantly increase funding for the Universal Service Fund’s Rural Health Care Program. The program’s current annual funding cap is $400 million. The cap was set in 1997 and was never indexed for inflation. Recently, demand for funding under the program has outpaced the budget, creating uncertainty for patients, health care providers, and communications companies alike.

The Chairman’s order would increase the annual cap to $571 million. This increase represents what the funding level would be today had the cap established in 1997 included an inflation adjustment. The order would apply the increased cap to the current funding year to immediately address a critical funding crisis and enable rural health care providers to continue offering telemedicine services. The order would also give these providers long-term certainty about universal service funding by adjusting the cap annually for inflation and allowing unused funds from prior years to be carried forward to future years.