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                         FEDERAL COMMUNICATIONS COMMISSION

                        TELECOMMUNICATIONS AND HEALTH CARE
                             ADVISORY COMMITTEE MEETING

                                         
                                         

Pages:    1 through 189

Place:    Washington, D. C.

Date:     July 11, 1996                  FEDERAL COMMUNICATIONS COMMISSION
     
                      TELECOMMUNICATIONS AND HEALTH CARE 
                           ADVISORY COMMITTEE MEETING  
                                        
     
                                 July 11, 1996                   
     
     
     
                                  FCC BUILDING
                                    ROOM 110
                              2000 M STREET, N.W.
                            WASHINGTON, D.C.  20554
       
                                        
     
     
                     IN ATTENDANCE:
                
                     GREG LAWLER, ESQ.
                     Floria & Perrucci
                     Presiding
     
                     ELLIOT MAXWELL
                     Federal Communications Commission
     
                     LYGEIA RICCIARDI
                     Federal Communications Commission
     
                     JAMES BRICK
                     West Virginia University
     
                     JAY H. SANDERS
                     ATA
     
                     BILL BAILEY
                     Southeastern Bell Tel.
     
                     JAMES MCCONNAUGHY
                     NTIA/DOC
                          IN ATTENDANCE:  (Continued) 
     
                     RON COLEMAN
                     Med. Tel. International
     
                     RICK PFARR
                     Med. Tel. International
                     
                     LOUISE NOVOTNY
                     CWA
     
                     WILLIAM ENGLAND
                     HCFA
     
                     JOAN KING
                     AARP
     
                     HELEN CONNORS
                     University of Kansas Medical Center
                     School of Nursing
     
                     PAUL ZIMNIK
                     Department of Defense
                     
                     CINDY TRUTANIC
                     OVP - Tipper Gore
     
                     MIKE KIENZLE
                     University of Iowa
                     National Lab.
     
                     MARY JO MACLAUGHLIN
                     Eastern Maine Healthcare
     
                     NANCY SHARP
                     American College of Nurse Practitioners
     
                     EUGENE V. SULLIVAN
                     University of Virginia
     
                     ART LIFSON
                     CIGNA
     
                     TOM SPACEK
                     Bellcore
     
                     AL SONNENSTRAHL
                     Consumer Action Network
                          IN ATTENDANCE:  (Continued)
     
                     THOMAS LORAN
                     High Plains Rural Health
     
                     ROGER GUARD
                     University of Cincinnati
                     NetWellness
                
                     JAMES H. "RED" DUKE
                     University of Texas
                     Houston Medical School
                
                     STEVE COTTON
                     Texas Tech. University
                     Health Science Center
                     
                     CANDY CASTLE
                     AT&T Wireless Services/CTIA
     
                     DENA PUSKIN
                     Chair, Joint Working Group on Telemedicine
                     Deputy Director, Office of Rural Health Policy
     
                     MARY JO DEERING
                     USDHHS
                     Office of Disease Prevention and Health Promotion
                
                     REED TUCKSON
                     Drew University
     
                     BILL M. WELCH
                     Nev. Rural Hospital Project
     
                     ERIC R. MENN
                     Partners HealthCare System, NC
     
                     GEORGE KAMP
                     American College of Radiology
     
                     JEANINE POLTRONIERI
                     Federal Trade Commission/AAD
     
                     KIM KIRBY
                     MCI
     
                     JIM POTTER
                     ACR
                          IN ATTENDANCE:  (Continued)
     
                     BOB WATERS
                     Arent Fox/Center for Telemedicine Law
     
                     SUSAN STEVENS MILLER
                     Maryland Public Service Commission
     
                     HARRY L. ROESCH
                     Appalachian Regional Commission
     
                     THAYER NELSON
                     Managed Care Options
     
                     ALLISON BAKER
                     American Telemedicine Association
     
                     JENNIFER RAPP
                     National Rural Health Association
     
                     KURT SLOOP
                     NTIA
     
                     STEVE TOLKEN
                     Communications Daily
                     
                     KEVIN ROTH
                     IBM
     
                     PAT HUNNICUTT
                     IBM
     
                     LOUISE ARNHEIM
                     Consultant
     
                     SUZY TICHENOR
                     Council On Competitiveness
     
                     ROBERT HAGA
                     NECA
     
                     MIKE BUAS
                     Federal Communications Commission/OCF
     
                     RICHARD RETTIG
                     Rand
     
                     RAM BHAT
                     Rand
     
                     IN ATTENDANCE:  (Continued)
     
                     CHARLES DOUGHERTY
                     Creighton University
     
                     LYNN START
                     Telecom Reports
                
                     SID HOUSEIN
                     Bellcore
     
                     GOU SANCHEZ
                     Neuro Surgical Associates
                     Sioux Falls
                     Sioux Valley Hospital
     
                     ERIC G. TANGALOS
                     Mayo
     
                     LUIS GUILLERMO KUN, Ph.D.
                     Center for Information Technology
                     
     
                                                       
                                                  P R O C E E D I N G S                         
                                                                 10:05 a.m.
                    MR. LAWLER:  Why don't we try to get started. 
     We've improved over last time.  We have coffee this time. 
     Welcome, everyone.  I know we've got some people who weren't
     here last time and some replacements or stand-ins
     temporarily.  But welcome to our second meeting.
                    What I'd like to do both for -- just very briefly,
     a couple of ground rules.  We have a court reporter again,
     so we need to identify ourselves before we speak.  And I
     think we ought to quickly go around the room just -- and say
     who we are and where we're from to reaquaint ourselves from
     the last meeting.  I'm Greg Lawler and the Chair for the
     Advisory Committee.  And Elliot, why don't you --
                    MR. MAXWELL:  I'm Elliot Maxwell of the FCC's
     Office of Plans and Policies and we welcome you all and
     thank you all for coming.  And in order not to call upon the
     services of any of the doctors here, maybe you -- if anyone
     wants to take off their coats, feel free to do so.
                    MS. MACLAUGHLIN:  I'm Mary Jo MacLaughlin from
     Eastern Main Healthcare, Bangor, Maine.
                    MR. BAILEY:  I'm Bill Bailey from Southwestern
     Bell in St. Louis.
                    MR. KIENZLE:  I'm Mike Kienzle.  I'm the Associate
     Dean for Clinical Affairs at the University of Iowa College
     of Medicine and the Director of the National Laboratory for
     the Study of Telemedicine.  And NLM funded a hospital R & D
     network for telemedicine.
                    DR. SANDERS:  I'm Jay Sanders, President of the
     American Telemedicine Association.
                    MS. TRUTANIC:  I'm Cindy Trutanic.  I'm an
     attorney and I'm with the Office of Tipper Gore.
                    MS. CONNORS:  I'm Helen Connors and I'm with the
     University of Kansas Medical Center School of Nursing.
                    MS. KING:  I'm Joan King with AARP National
     Legislative Council.
                    MR. ENGLAND:  I'm Bill England with the Office of
     Research and Demonstrations of HCFA and I'm the project
     director for their telemedicine demonstration.
                    MS. NOVOTNY:  I'm Louise Novotny with the
     Communications Workers of America.
                    MR. PFARR:  Rick Pfarr with Med. Tel.
     International, McLean, Virginia.
                    MR. COLEMAN:  I'm Ron Coleman.  I'm also with Med.
     Tel. -- I'm Chairman of Med. Tel. International Corporation.
                    MR. MCCONNAUGHY:  I'm Jim McConnaughy, NTIA, the
     Commerce Department filling in for Kathy Brown who got
     pulled at the last moment.
                    MR. MENN:  I'm Eric Menn from Partners HealthCare
     System in Boston, part of Massachusetts General Hospital.
                    MR. WELCH:  Bill Welch with the Nevada Rural
     Hospital Project in Reno, Nevada.
                    MR. TUCKSON:  Reed Tuckson, President of Charles
     Drew University of Medicine and Science in Los Angeles.
                    MS. DEERING:  Mary Jo Deering with the Office of
     Disease Prevention and Health Promotion where I'm the
     Director of Health Communication and Telehealth.
                    MS. PUSKIN:  I'm Dena Puskin.  I'm Deputy Director
     of the Office of Rural Health Policy where we administer
     over 20 networks in telemedicine and telehealth and
     administer evaluations.  And I'm also Chair of the General
     Interagency Joint Working Group on Telemedicine which cuts
     across all cabinet agencies developing (inaudible).
                    MS. CASTLE:  I'm Candy Castle.  I'm with AT&T
     Wireless Services representing Cellular Telephone Industry
     Association.
                    MR. COTTON:  Steve Cotton, Director of Marketing
     and Program Development for an organization called TelNet
     (phonetic) which is a telemedicine and a satellite-based
     distance learning project in Texas, out in west Texas at
     Texas Tech. University.
                    DR. DUKE:  My name is James, people call me "Red",
     Duke, D-U-K-E of the University of Texas Medical School in
     Houston.  I'm professor of surgery and a trauma surgeon. 
     And you'll understand later why I'm here.
                    DR. BRICK:  I'm Jim Brick.  I'm a rheumatologist
     for West Virginia University School of Medicine.  And I'm
     Medical Director of our telemedicine project which is
     Mountaineer Doctor Television (phonetic).
                    MR. GUARD:  I'm Roger Guard, NetWellness and
     University of Cincinnati Medical Center.
                    MR. LORAN:  I'm Thomas Loran, Executive Director
     of High Plains Rural Health, Fort Morgan (phonetic),
     Colorado.
                    MR. SONNENSTRAHL:  I'm Al Sonnenstrahl from
     Consumer Action Network of Deaf People.  I'm here
     representing people with hearing impairments, hearing
     disabilities.
                    MR. SPACEK:  I'm Tom Spacek.  I'm the Executive
     Director for National Information Infrastructure Initiatives
     at Bellcore in Morristown, New Jersey.
                    MR. SULLIVAN:  Gene Sullivan from the University
     of Virginia, Charlottesville.
                    MS. RICCIARDI:  Lygeia Ricciardi from the FCC's
     Office of Plans and Policy.
                    MR. LAWLER:  And Thayer Nelson is back there who
     many of you have talked to on the phone.  Thayer is sitting
     actually directly straight back there.  There is an agenda
     that I don't whether we passed it around, but it's back
     there.  Lygeia, why don't you just hand them out?  It
     doesn't tell us -- it just lays out what we're going to do
     with the hour.
                    What we want to try to do today is spend -- each
     of the subgroups, I know, has been talking either
     electronically or otherwise about where to go.  And what
     we're going to do today is spend an hour with each subgroup,
     the first 20 minutes to a half an hour with each subgroup
     head and members of the subgroup describing just what
     they've done so far, what they've identified as issues, how
     they're approaching those issues, where they think this
     ought to go, and then follow that with a general discussion
     so that there is interaction with everyone with that
     subgroup.  If there's a complete uniform view on that, if
     that's a great thing to do or a terrible thing to do or
     whatever, we will have a discussion about it.
                    What we want to try to do just to lay out -- well,
     everybody wasn't here last time.  But we have another
     meeting sometime in September which we'll talk about later,
     early in September.  And we are then going to submit a
     report to the FCC by the end of September.  There may
     actually be a date.  I think it's the end of September. 
     That does not give us very much time for a very large
     subject.  
                    So what we want to try to do today is get all the
     issues on the table so that everybody is comfortable that we
     are discussing issues that are significant and frankly try
     to organize them in a way so that we can get our hands
     around this in -- by September and actually provide some
     focused sensible advice to the FCC in the short time that we
     have.
                    I think the one thing that everybody -- well, I
     won't speak for everyone.  Certainly, the thing that I've
     concluded which I think we all knew coming into this is, you
     know, this is an enormous subject.  And if we can focus our
     efforts, focus our thoughts, pick out the things that we
     think are most important and to try to provide some sensible
     advice on those things, we will have made a great
     contribution.  We are not going to be able to do everything. 
     Telemedicine is going to evolve in a way that, you know --
     we could have a pool and we could guess about it, but we do
     need to try to focus our thoughts and -- and that's really
     what the purpose of today's meeting is.
                    What I'd like to do is also just if people have
     plans, if the subgroup heads are available after the
     meeting, I think we're going until 3:00 or 3:30, just for a
     short time so we can talk about how to organize ourselves
     going forward between now and September, that would be
     useful if you have the time.
                    What we thought we'd do is start with Jim Brick
     who is our rural subgroup head.  Do we have any other things
     we need to say before we get started?
                    MS. RICCIARDI:  That's about it for now.  When we
     take a break, I'm going to say something about a number of
     handouts that I've prepared, just copied, the reports and
     other items that I think may be useful to you.  And I'll
     just give you a quick run-through of that when we convene
     after the lunch break.  I think it's easier that way.
                    MR. LAWLER:  And I just saw walk in -- I don't
     know if anyone else has walked in.  Maybe if we could go
     around the room and identify those people.
                    MR. LIFSON:  Art Lifson with CIGNA.
                    MR. LAWLER:  Also, when you -- I'm sorry.
                    MR. ZIMNIK:  Paul Zimnik, the Department of
     Defense.
                    MR. LAWLER:  And another?
                    DR. KAMP:  George Kamp, American College of
     Radiology.
                    MR. LAWLER:  Also, we have a court reporter, so --
     oh, I'm sorry.  Did I miss someone?
                    MR. ROESCH:  Harry Roesch from the Appalachian
     Regional Commission.
                    MR. LAWLER:  I'm sorry.  Before you speak, please
     identify yourself so that the court reporter will know who
     you are.  We're going to pass around an attendance sheet so
     she will be able to see who you are and correctly identify
     you.  So let's try to help her out, as well.  It will help
     people looking at this.
                    What we thought we'd do is start with Jim Brick
     and the rural subgroup and spend an hour talking about that
     and then move forward.  So Jim, it's all yours.
                             RURAL SUBGROUP REPORT
                    DR. BRICK:  Okay.  Thanks, Greg.  I'm Jim Brick
     for the record.  Thanks a lot for this opportunity.  The
     rural subgroup is comprised of a number of folks.  I'd like
     to put their names in the record:  Narcisso Cano (phonetic),
     Helen Connors, Charles Holland, Mary Jo McLaughlin, Paul
     Pilar (phonetic), Dena Puskin, Eugene Sullivan and Bill
     Welch.  Most of these folks, nearly all of them really have
     contributed to the things that I'm going to tell you today.
                    As we discussed at the last meeting, there is a
     lot of overlap between all of the groups that we outlined
     last time.  And I think that that's good because that way we
     get a lot more input into what we're going to decide.  Dena
     Puskin and I after the last meeting, we did talk about this
     though and decided that we needed to start somewhere.  It's
     kind of a guldian (phonetic) knot that we're trying to
     unravel here.  And we decided we would send out four
     questions to people and let them respond to these.  And then
     we would start with those.
                    And my job was to sort of collate everything and
     put it together into a summary that we could present to you
     folks and also to cajole them into responding while they
     were on vacation and stuff like that.  There are four
     questions -- and I hope you have the handout that was in the
     back -- that we asked.  The questions --
                    MR. LAWLER:  Does everybody have -- do we have
     copies of it --
                    DR. BRICK:  I put lots of copies back there.  You
     can -- I have these overheads if -- I wasn't going to use
     them.  But in case people don't have the handouts, we could
     put those up.  
                    Anyway, there are four questions.  And the four
     questions are:  1) What is the definition of rural?  2) Who
     should be the providers that we include in this?  3) What is
     the minimum functionality that we thought that should be
     covered under the universal service provisions and should it
     be the same for all providers?  4) And what are the current
     variations in pricing in rural communities for various
     levels of functionality and what are the implications for
     the subsidy of establishing various minimums?
                    We had lots of responses to all the questions. 
     There are a lot of differences in opinion about how we need
     to do this.  I think some of the differences are engendered
     by the fact that people are -- bring something to this
     committee, their own experiences of where they are; what's
     available in their particular part of the country; the
     problems they have; what they're doing there.  And I think
     that that accounts for a lot of the differences.  But there
     are also a lot of similarities.
                    With regard to the first question -- what's the
     definition of rural -- the act requires that access be given
     to services comparable to those available in urban areas and
     at comparable rates.  And this requires a practical and a
     sensitive definition of rural.  And a definition of rural is
     hard to come by.  We had a lot of comments.  People thought
     it needed to be as inclusive as possible.  But they also
     didn't want to cost to be extraordinarily prohibitive. 
                    There's a lot of concern that if travel time is
     used as a benchmark by some people, that -- that -- or
     distance is used as the only benchmark, that it will be
     prohibitively expensive in some rural states in the west
     because of the long distances to get from anywhere to
     anywhere else.  
                    Another suggestion that after reading the
     responses that everybody sent in, I think one of the ideas
     was Dena's idea that was in a handout that she gave us from
     some testimony that she gave which was a combination of
     office management and budget, metro and nonmetro county
     rankings which is a way to divide counties as to rural and
     nonrural.  And then there's a U.S. Department of Agriculture
     Economic Research Service, urban influence codes which can
     be dovetailed with that, and a modification of that which
     comes out at Dena's office.  
                    I think, again, an attempt to be as inclusive as
     possible with this definition of rural because there isn't
     any one definition of rural that fits everything.  And also,
     one of the points that Dena made in her comments to the
     board I think which was very appropriate is there also needs
     to be some special consideration for these parts of the
     country where you just have a few people living per square
     mile.  I mean, just really, really frontier areas of the
     country and really none of the rules really fit those kind
     of folks.  
                    We don't want to leave them off the information
     super highway.  From the meeting that we had the last time
     when the senators got up and made speeches, it sounds like
     they don't want anybody left off the information super
     highway.  So I think we need to consider those folks, as
     well.
                    What providers should be included on the list of
     eligible providers?  For example, should physicians' offices
     be included on the list?  This is the second question. 
     Again, here we had lots of viewpoints.  The real issue here
     I think is is whether to include the private practitioners'
     office, not usually thought of as being a not-for-profit
     venture though at the last meeting, some WAGs (phonetic)
     suggested maybe that they were not-for-profit ventures.  I
     think they don't meet anybody's definition of being not-for-
     profit.
                    And -- but there was a lot of concern that we
     needed to find some way to be able to do that.  There were -
     - there were several comments maybe that this could be
     addressed as part of a network or cooperative type
     arrangement between smaller places, the doctor's office,
     very small clinics, et cetera, and maybe a bigger place;
     that this would allow them to share use and decrease cost. 
     But there was also a lot of concern as to whether that would
     be allowed by the act.  I think the act has some specific
     language about selling services.  And I'm not sure how that
     we can address that.  
                    But that was a concern that people had because --
     because a lot of the care that's given in rural communities
     is given not even in the small rural hospitals.  It's given
     in individual practitioners' offices.  And we put those
     people out there.  We want them to do a job for us.  And
     then we cut them off the network.  That -- you know, that
     doesn't seem to make very much sense.
                    People thought it ought to be very inclusive. 
     There was a lot of comment that it ought to be public and
     not for profit.  Again, include doctors, nurse
     practitioners, PAs, you know, any kind of health care
     provider that needs it.  Some people thought that -- that it
     would be okay to just include anybody that's now
     reimbursable for services; that is, anybody that can be paid
     now to be included.  And one person suggested that we ought
     to ask Congress for some clarification on this and see
     exactly what they mean by that.  
                    The third question is is what is the minimum
     functionality or band width covered under the universal
     services provisions and should that minimum be the same for
     all health care providers.  The main issue here seems to be
     the less-than-hospital-size application.  I think everybody
     that responded -- and everybody did respond to this question
     -- felt that -- that we need to have a fairly robust service
     that goes to small rural hospitals.  
                    And most people talked in terms of something
     equivalent to a T1 line.  Some people talked about, you
     know, fancy switching with ISDN lines and using those to --
     to mount up a T1 line and some other things.  I read all
     these responses.  But I've got to be honest with you.  I
     don't understand all this stuff.  But I -- but I know there
     are ways to assimilate broader band width using smaller
     pieces.  And I think people were very interested in being
     able to get that kind of a service, approximate the T1 lines
     in the hospitals.
                    There was also a lot of talk about the Internet
     and the Internet being available in all of these communities
     as a local call, not as a long distance call.  The Internet,
     of course, allows access to the National Library of
     Medicine, world wide web, all these services that we all
     take for granted now.  But I can tell you now that my
     friends and classmates that work in rural West Virginia
     don't have those things.  And they would love to be able to
     have those things and they want them.  And in some places in
     West Virginia, you can't get them at any price.  And I think
     that's a very appropriate thing to be able to do that.
                    On the other hand, in the last three weeks, I
     personally found out as a result of collating all this stuff
     that it's -- the Internet is not going to be available to do
     brain surgery.  Okay?  It -- things happen on the Internet. 
     You don't get messages.  And it's hard to find out what
     messages you get and you didn't get.  It crashes.  You know,
     you go down on vacation and you have your laptop with you
     and on Tuesday, it dies.  And you call the computer guy at
     your place and he says oh, that; no, I can't fix that from
     up here; you've got to bring it back.  Okay?  
                    So -- and -- so, you know, I think there is a
     limit to how much you can do with the Internet.  But the
     Internet can do a lot of things with telemedicine and
     certainly, the education things should be available to
     everybody.
                    As far as providers, there was some talk, a great
     deal of talk about more robust service for them.  For
     example, in qualified clinics, it would be ISDN lines that -
     - that that would allow more robust service in those areas. 
     And one of the comments that I thought was particular
     appropriate was that whatever we -- we set -- we decide on,
     that there needs to be an appeals process so that if I think
     that I've got a problem that needs to be addressed with more
     robust service than the act -- than our reading and putting
     into effect provides for, that there's an appeals process
     that they can come and provide information that allows them
     to get a more robust service.
                    The final question is regarding current variation
     in pricing in rural communities for various levels of
     functionality and what are the implications for the subsidy
     of establishing various minimums.  I think there's a lot of
     agreement here in the issue of shared use.  I think people
     understand that by having education, the libraries involved
     in this, that there's at least the potential here for the
     line cost to come way down.  
                    People believe -- a number of people believe that
     lower cost will increase use and make it economically
     feasible.  And that reminds me of "Red" Duke beside me.  And
     years ago in Texas when Lyndon Johnson was in the House or
     the Senate, he was trying to get a dam built in Texas to
     generate power.  And we was told repeatedly that the people
     in east Texas, in the hill country of Texas, that they would
     never be able to use the power and they couldn't pay for it
     and, you know, there wasn't enough people there and, you
     know, all these kinds of arguments that we all hear all the
     time.  
                    But they built the dam.  Sam Rayburn saw to it
     that they built the dam.  And they sold the power.  And in
     fact, they made the dam even higher after they started
     building it.  So, you know, there is precedent for that
     idea; that lowered costs will increase use and make it
     economically feasible.
                    There was also some comments which, again, I think
     I mentioned before that rates can't be distance sensitive or
     that that shouldn't be the only thing that goes into the
     calculation of the rates because charges get out of hand
     very quickly in some of the rural areas in the west where
     there are large distances that people have to go with the
     phone lines. 
                    And another comment was that if we would just tell
     the phone companies or the other carriers what it is that we
     want and go to them and ask for their help in finding a
     balance between what can be done and what can't be done, and
     putting together these cooperative ventures with the
     education and the libraries and the other people in the
     community that might be interested in participating.
                    Obviously, we need to narrow these opinions down. 
     And I would propose that we do this with some subgroups to
     give a more focused answer to all of these questions.  But I
     wanted to tell you where we are.  We obviously don't have
     all the answers yet.  But I think we've made a good start. 
     I'd welcome input now from any of the folks on the committee
     and thank you all for your attention.
                    MS. PUSKIN:  Could I just ask for clarification on
     something?
                    DR. BRICK:  Sure, Dena.  Yes.
                    MS. PUSKIN:  I'm Dena Puskin for the record. 
     Okay.  On the issue of the definition of rural, in the
     testimony that I gave in front of the board, what I
     suggested was that there were several alternatives that one
     could use that are in place.  You have to be feasible and
     practical and use things that are not -- the best can be the
     enemy of the good.
                    And one of them is using OMB's metro/nonmetro
     definition, but doing what we call the Goldsmith variation
     which is something we developed for our own grantees because
     what's happening is metropolitan areas have grown very large
     as a result of various consolidations in the 1990 census. 
     And you have really pockets of real rural areas within
     what's considered a metropolitan area. 
                    So we hired a demographer to look at those areas
     to basically define what are really rural in character,
     rural in economy, rural in characteristic within metro
     areas.  And we have actually a list that we use in our grant
     programs that any GS-5 or 4 clerk can go down.  And if you
     give them -- you know, a grantee can fill it in.  And you
     can figure out very quickly what is metro -- what is urban
     and rural by that definition.  And you'll need that kind of
     simplicity for administrative purposes.  That's one option.
                    The other is the Economic Research Service of the
     U.S. Department of Agriculture has come up with what they
     call they Urban Influence Codes.  And they have some
     alternative definitions.  And I suggested in my testimony
     that we look at both of those and decide essentially which
     might be better.  But both are relative feasible to
     implement.  And again, I always use the test is if I gave it
     to one of my clerks, could they implement it with accuracy;
     and if some hospital filled it out and gave it to a clerk to
     fill in, could they understand it well enough to apply.  And
     that's I think very important in the definition of rural.
                    In terms of the issue of frontier, I think it's
     very, very important to recognize that we have frontier
     areas.  And we need to examine whether we need to impose
     some other definitions regarding them.  But there's some
     trade-offs there.  Clearly, frontier would fit the rural
     issues.  There are some complicating factors in defining
     comparable services for frontier that go with the way the
     act reads.
                    So I think our group needs to spend some time on
     that in order to give I think the FCC some good definitions
     for areas that can be viewed for some comparability for the
     purposes of what the act calls for.  That's all.
                    DR. SANDERS:  Okay.  Jay Sanders, American
     Telemedicine Association.  There's -- one of the issues that
     Jim reported on that I would sort of like to underline and
     that I think is a very basic seminal issue -- and I'm not a
     member of the group so I wasn't part of the discussions that
     they had -- but to me a very critical issue relates to the
     basic construct of the Telecommunications Act in defining or
     allowing this to be provided -- the telecommunications
     infrastructure to be provided only to the nonprofit entity,
     and that basically being the hospital or health care
     facility.
                    The reality in rural America -- and I've been
     involved with this for many years on a hands-on basis -- the
     reality is the majority of health care practice does not
     occur in the hospital.  It occurs in the physician's office. 
     It is, in fact, the -- the untoward event that has occurred
     in the physician's office that allows a patient to get into
     the hospital.
                    To me we have got to indicate that the act in some
     way has got to either be amended or edited to include the
     primary care physician's office or the primary provider's
     office.  That's where medicine occurs.  If you're going to
     provide functionality to a facility where only ten percent
     of the health care is being practiced, it makes no sense to
     me.  Ninety percent of the health care practice occurs in
     the primary care physician's office.  I would hope that we
     would come out with a strong message to indicate that.
                    MR. LAWLER:  Can I just -- two reactions to that. 
     One -- and really looking at this in two ways.  One, if that
     is the advice that we think we ought to offer to the
     Congress meaning, you know, if you could make this better by
     including primary care physicians or however we want to
     describe it we ought to do that.  But I also think we ought
     to be realistic about it and think, you know, in the context
     of what we have, what can we do to suggest that there is a
     mechanism here.  Public and nonprofit may mean something
     more than just a hospital.
                    And I do think maybe that's some specific task we
     could assign to people or people would volunteer for just to
     sit down and think about, you know, how do we take these
     words, what they mean, and suggest to the FCC, to the joint
     board that, you know, here's how medicine is practiced. 
     There are parts of this which, you know, they may not appear
     to be IRS definitions but are public nonprofit nonetheless. 
     And this is something you ought to think about when you
     interpret what these words mean because, I mean, we all know
     that Congress with the best of intentions doesn't move as
     quickly as -- 
                    Let me just -- Paul, I think you had your hand up
     first.
                    MR. ZIMNIK:  Yes.  Paul Zimnik with the Department
     of Defense.  Just to elaborate on Jay's comments, I further
     believe that if we are going to make recommendations along
     those lines, we take it even further.  We see a growing
     decentralization in health care delivery.  So it's not only
     from the hospital to the doctors' offices, but even one step
     removed from that, into the home.  So I think that in the
     future, we are going to see much of the health care access
     and the services interaction from the home itself.  So if
     we're talking about an act that will impact the next 50 to
     100 years in this country, we need to keep that strongly in
     mind.
                    MR. KIENZLE:  Mike Kienzle, University of Iowa.  I
     don't disagree with either of those comments.  But I think
     that you're not factoring in some very strong market forces
     that have been in place and in play for over the last ten
     years or so.  That is the integration and consolidation of
     physicians and other providers into integrated health care
     delivery systems including the hospital, including the
     physicians' offices, including the home health care sites of
     care.  
                    And frankly, I think just even left alone, the
     integration and consolidation of physicians within -- either
     in information consortiums or actual integrated delivery
     systems will, in fact, functionally take care of the notion
     of access for all of the various providers of health care.
                    MR. SULLIVAN:  Gene Sullivan, University of
     Virginia.  You know, the act does not prohibit or exclude
     the doctors' offices from activity.  What I think -- when
     the phone company puts in and meets our requirements, if a
     private practice office wants to be included, they can be
     included.  It's just we were talking about the subsidies and
     the rate differences.  
                    Why are we looking at subsidizing someone that's
     in a private practice?  If, for instance, the T1 line goes
     down the street to the rural hospital and along that street
     is the private practice office, why can't the private
     practice office jump onto the competitive carrier and use
     that service paying the appropriate rate?
                    MR. LAWLER:  Al.
                    MR. SONNENSTRAHL:  Al Sonnenstrahl speaking of
     Consumer Action Network, speaking through a sign language
     interpreter.  I have several questions.  I appreciate the
     comments brought up today.  But first, we do have a clear
     definition of the word, "rural".  Does -- does the
     definition of the word, "rural", include people with
     disabilities who are isolated -- insulated -- as insulated
     as people living outside in the boonies.  We have to
     research that.  How accessible also are these services?  Are
     we over-depending on audio -- the audio part?  Can we become
     co-dependent between audio and visual use?
                    I watch TV pretty often and I notice that often
     when they use distance interviews, the audio part gets lost. 
     So we have to be careful and make sure that we're not overly
     dependant on the audio only and make sure that everything is
     captioned so that we won't be depending on sound alone.  
                    And you mentioned about appeals.  I think that's
     wonderful.  How accessible are they?  How can a deaf person
     file a complaint if there's no way for a person to call in
     or for a person to get information visually?  And you
     mentioned that this should not be distance sensitive.  And I
     agree with that.
                    How about multi-line sensitivity because sometimes
     a doctor needs an interpreter to communicate with a patient,
     especially in a rural area or in a metro area.   They will
     need to include an interpreter.  And you'll have to get
     another line to communicate with a patient through the
     interpreter.  And that would mean an additional line.  And
     that should not be included in the cost or it should not be
     an additional charge to the cost.  
                    And when I speak about deaf people or disables
     people, I'm not speaking about them as patients.  I'm
     speaking as if they are involved -- involved in the health
     care system itself.  I've met some deaf doctors who have
     expressed some frustration over not being able to get
     information as much as you guys do.  Thank you.
                    MR. LAWLER:  Somebody else had their --
                    MR. WELCH:  Bill Welch from Nevada Rural Hospital
     Project.  I don't disagree with any of the previous comments
     that have been made.  I would like to support a couple.  As
     we move forward with this, I agree that there's nothing in
     the act that prohibits the private practioner from having
     access to whatever is developed.  I would want to make sure
     that we don't dilute this so much that the resources
     available are not going to be able to be effective in
     developing an effective system.
                    Whoever is subsidized and supported through this
     act I believe should have the same responsibility to provide
     all the patients services.  And I find from my experience
     that many of our private practioners would not collaborate,
     cooperate, they are not always available and they do not
     agree to see all patients.  Hospital centers, at least in
     the west, are beginning to have to subsidize many physician
     practices and would be the core focus of an integrated
     delivery system, as least that's our experience in Nevada.
                    And so while I support having primary care
     physicians having this functionality, I think that the
     biggest cost factor is getting the line functions to the
     rural community.  And I think the competitive market is
     going to make the equipment affordable to the private
     practitioners or the private industry to buy into it.
                    DR. BRICK:  Could I just ask -- I've read the
     language of the act, you know, as regards this.  And I have
     not real -- you know, I'm not used to reading acts.  Okay? 
     But --
                    MR. LAWLER:  Thank God.  That makes you qualified.
                    DR. BRICK:  Yes, right.  But one of the things
     which several of the folks here have commented on and wrote
     in on the e-mail about this was is there some way that this
     can be done to get these folks tied into a hospital or a
     bigger clinic through the idea of a network or co-ops or
     something.  You know, I don't know what the right word is,
     but some way of doing this that they're sort of brought into
     the fold and at the same time not violate the spirit of the
     act that I think kind of prohibits subsidy of private
     business.  I mean, that's my understanding of it.  Is there
     some -- you guys read these things.  Is there a way to do
     that, you know, or --
                    MR. LAWLER:  We put a big cloud over it and say
     some magic words and --
                    DR. BRICK:  Yes, okay.
                    MR. LAWLER:  I mean, there really isn't and --
     Bill had a comment which we'll get to.  But I mean, the
     answer is none of this is clear.  I mean, you're talking
     about a lot of money moving around.  You have a provision
     that, you know, is literally that long.  And the FCC's got
     to interpret.  They're, you know, I'm sure sitting there
     saying, you know, who is going to sue us about what.
                    DR. BRICK:  Yes, right.
                    MR. LAWLER:  You know, it -- and I think we have
     to think about what our job is.  And our job is, you know,
     we're not writing a regulation.  We didn't write the law and
     we're not writing the regulation.  Our job is to provide
     advice about what we think the right outcome is.  
                    And we can say, for example, with the word we
     think that you ought to interpret them to cover things which
     we think are important; and by the way, you ought to do
     something more because, you know -- I'm not saying there's
     agreement on this -- but if everybody says it ought to go to
     every primary care physician in -- you know, in a rural
     area, you know, we ought to tell the FCC and the Congress
     they ought to do that.  I'm not suggesting we do that, but
     that -- you know, we can certainly give that advice.  I
     think you will find some people saying isn't that going to
     cost a lot of money and, you know, not out of my pocket. 
     But --
                    MR. BAILEY:  Well, and -- Bill Bailey.  To build
     on that and what I think you said earlier, the fact that --
     we're looking at telemedicine.  And I think the act requires
     some sort of subsidy to flow.  And the question is whether
     or not subsidy is needed in every circumstance.  Obviously,
     you can have a primary care physician on a network operating
     using telemedicine in a nonsubsidized environment.  So I
     mean, they're not going to be precluded from that.  
                    And somebody earlier mentioned the idea of home
     health care.  And I think there had to be some point where
     things start making sense and stop making sense.  I mean,
     are you going to subsidize an ISDN line into everyone's home
     so that they can health care?  No.  I -- there's -- you're
     going to back up from that at some point.  And I think
     what's important is what level of subsidy do we want to have
     happen.  And then, is there a way for primary care
     physicians either to take advantage of that subsidy under
     the act or not?
                    MR. LAWLER:  Jim, can I ask a question.
                    DR. BRICK:  Sure.
                    MR. LAWLER:  And I think Tommy's going to raise
     this later.  But I -- we did talk about it to some extent
     last time.  It also seems to me that we need to be talking
     about a common set of things.  What is it about health care
     that we're talking about?  You know, we're obviously not
     talking about everything from, you know, the day you're born
     until the day you die in terms of health care.  We are
     talking about, you know, how do we identify what the -- what
     the medical technology that we want to cover for a rural
     area.  
                    And then you have -- I'm not going to steal Tom's
     thunder because I know he wants to talk about this.  But
     you're also talking about what can the telecommunications
     technology do to help that.  You know, there are some things
     that it can do and there are some things that it can't do. 
     But it seems to me that's another thing that, you know, we
     need to focus on from a rural perspective.  You know, you
     have a national perspective, you have a rural perspective. 
     Is there some level of health care service that is, you
     know, the minimum that we can identify or isn't there?  And
     if there isn't, we ought to say that.  
                    But I do think that those are kind of -- you know,
     that ought to be included in our discussion of, you know,
     what is critical for a rural area.  And you know, the bigger
     it is, the more costly it is and the more people you put
     into it, you know, the more objections you're going to get
     to it.  But I do think that we need to be thinking about
     that.  
                    Let me -- I'm going to start with people who
     haven't talked.  I'm sorry, I don't know your name.
                    MS. CONNORS:  Helen Connors.  I'm with the
     University of Kansas School of Nursing.  And I just wanted
     to states that I think we need to be cautious about using
     the word, "primary care physicians", in rural areas because
     much of the care in rural areas is provided by nurse
     practitioners and physicians assistants.  So I think we need
     to be careful of that.
                    MR. LAWLER:  Let's go down the row.  Yes?
                    MS. KING:  One of the things that Dr. Brick said
     that I was impressed by was that lower costs will increase
     use.  I think an important point is that you have to get the
     price of these services correct when you're putting them in
     in the first place.  We're in a situation where there's more
     investment in urban areas than in rural areas.  And it's the
     discretion of the telephone company to make those calls
     where they're going to put the investment.
                    And it would seem that there should be an
     incentive to bring some of that investment back into the
     rural areas.  And they don't have to invest depreciation and
     profit mining in rural areas if they don't want to.  So
     rather than just say well, we'll subsidize, why not give
     incentives to improve the infrastructure across the country.
                    But along that line, that the service is actually
     priced at cost for many of the users in rural areas whether
     they be physicians or nurse clinics or teaching
     institutions.  So getting the price right and to bring the
     investment to the area is a crucial issue that should be
     brought to the forefront.
                    MR. LAWLER:  Down on the end.
                    MS. POLTRONIERI:  Hi.  I'm Jeanine Poltronieri. 
     I'm in the FCC Accounting and Audits Division.  And I'm
     working on the Universal Service Fund of this.  First of
     all, I'd like to thank everyone for being here.  I think the
     advisory committee is doing great work and I really
     appreciate it.  I know everyone in our division appreciates
     it and everyone on the joint board appreciates it.
                    I'd like to make a comment on the definition of
     health care practitioner.  And I think it has some broader
     applicability.  I think the joint board has a very specific
     task before implementing Section 254 of the act.  And if you
     look at the act and look at the definitions of certain terms
     and see what's there, I think you're going to be given a lot
     of guidance about how you would define health care
     practitioner.
                    What I'm hearing is people are concerned that that
     -- the definition in the law isn't broad enough or that
     there should be other incentives to allow people to get
     hooked into this network although not necessarily be
     subsidized.  So maybe in looking at this issue and other
     issues, a proper way to approach it would be first to think
     of what is the act telling us; what direction is the act
     suggesting; what would be helpful for the joint board to
     hear from us when they're implementing these various
     specific issues.  
                    And then I saw that the second question, what
     other provisions of the Telecommunications Act of 1996 can
     we look at that might -- might have a broader approach? 
     What might we suggest as the next step for Congress?  What
     might we suggest as the next step for the Commission?  But I
     think it might be easier if we sort of -- if you're doing
     your work, is to separate it out; what the joint board
     should do; what did Congress need for them to do; what does
     the language of the act say and what do we think is the best
     way to reach that goal.  
                    And then secondly, what else is there; what was
     left out; what didn't they get right and how we can move
     towards those goals.  But I don't mean to limit anybody's
     efforts.
                    MR. LAWLER:  The gentleman in the back.
                    MR. WATERS:  My name is Bob Waters.  I'm with the
     law firm of Arent Fox and the Center Telemedicine Law.  When
     I listen to the discussion on this, I would think that in
     order to allow us to move forward, I think we first need to
     really focus on those services that are available via the
     telecommunications, you know, technologies that are
     available in urban areas, define what those are and define
     which of those we feel -- or define how to make those
     applicable, what kinds of subsidies would be necessary to
     make them applicable to rural areas.
                    I am not as hung up on the issue of public and
     nonprofit language in front of the provider section of the
     statute because I think that -- I think Dave's point is well
     taken.  I think that a lot of services can be delivered by
     private practice provisions in rural areas.  But there may
     be creative things we can do in terms of structuring the
     maintenance and work your way around that.  I think that is
     really the system with an intent of the authors of the
     statute and I think we need to take a look at it.  I think
     we need to do that without having to go to the process of
     reopening such issues. 
                    But I think the first issue is how do you get
     comparable services in the rural areas.  And once you've
     done that, then you know what you need to do.
                    MR. LORAN:  Yes.  Tom Loran of High Plains Rural
     Health, Fort Morgan (phonetic), Colorado.  I'd like to echo
     that concern.  Our big challenge right now isn't so much
     subsidies.  It's the lack of services.  We simply don't have
     digital services available in 95 percent of our area.  And
     what we have to do is back haul hundreds of miles at a cost
     of $2,000.00 to $5,000.00 a line.  So really, subsidy is my
     second concern.  My first concern is building an
     infrastructure to support what we need.
                    MR. LAWLER:  Dena.
                    MS. PUSKIN:  Yes, I'd like to go back and -- I
     agree that the strategy should be for us to concentrate and
     make sure we do what's in the act and make sure we help the
     FCC get through what is being asked in the act.  And if you
     look at the act very carefully, it says really there are two
     areas.  There is one area which says what really do we need
     to ensure comparable services in rural areas for everyone,
     not -- you know, not just health providers.  But what's a
     basic minimum level of universal service in a rural area?
                    Now, if you look at that component and you start
     thinking about that, you might say, well, look it, if we
     could get Internet access a reasonable rate, let's say 28.8
     baud or some other to basically everyone in a rural area,
     how would that not only help everyone in the area and build
     the services, but also build those services out to private
     practitioners and others who might not necessarily be
     eligible for the subsidy, but certainly will have an
     affordable service.  Because that is really the key.
                    Without the basic level of infrastructure there,
     no one out there gets an affordable service.  And that's
     what High Plains has felt.  That's what I know has been felt
     in west Texas.  And a number of the projects that you
     probably have around the table, we've funded.  So I know
     what their problems are.  So it would say to me that part of
     is -- is in thinking about the health side, to say well,
     look it, if we have a basic infrastructure out there and we
     define that for everyone, that would get your home health
     care services out there.  That would be affordable and it
     also would probably also be acceptable.
                    The other thing to recognize is it's a moving
     target.  What is the services now that we think are critical
     medically is not going to be the case three years from now. 
     So we're talking about a medical -- and I am not -- and I
     now we're going to get into this -- I'm not sanguine about
     developing guidelines by service.  What I am -- I am not
     sanguine about that at all.  And I will -- I will argue
     against it later, so I'll set you up for that right now.
                    I think we do need to define functionality by some
     very broad characteristics.  And I believe we should define
     in a way by at least what we want for the clinics, what we
     want for the hospitals out there and what we want as a basic
     service for everyone which may indeed evolve and make it
     much easier for systems to reach out to hospitals.  
                    And just one second.  I think we have some very
     basic problems even within the act with definitions.  And I
     know this is the technician in me.  But what do you mean by
     a community health center?  Do you mean a federally
     qualified community health center or do you mean anyone who
     puts a shingle out and says they're a community health
     center and they happen to be nonprofit?  The reason I ask
     that is because I think we probably will want to seek the
     broader definition.  But it makes -- it may make a big
     difference for the subsidy level.  
                    And so we've got two issues I think.  We've got
     the basic issue of what do we want out there that helps to
     stimulate, incentivize that basic infrastructure and what do
     we want particularly to get subsidies in the health care
     field.  And that is essentially, initially at least defined
     by the act, and how do we refine these definitions.  Given
     that, then I think we can make comments again along what we
     think needs to be done in the future.  But we've got to get
     the work done with the act.  And we don't have it done.  And
     we've got a short time frame.
                    DR. KAMP:  George Kamp, American College of
     Radiology.  Earlier, Dena's comments, I was wondering if
     there was discussion in the subgroup in terms of the
     definition of rural and its implications as far as
     differences in HCFA reimbursement, for example.  Did the
     subgroup discuss that?
                    DR. BRICK:  No.
                    MS. PUSKIN:  No.  I mean, there are -- HCFA has
     some very specific definitions which are -- they vary by
     program.  If -- if you're talking about payments for
     hospitals, it's metro/nonmetro.  If you're talking about
     special payments for rural health clinics, it's another
     definition by the Center called nonurbanized areas.  And so
     there are some differences.  And I think what we thought
     would be very critical was just to have a rational
     definition for rural that could be implemented that
     basically irrespective of this -- which would relate to a
     subsidy for infrastructure development.
                    DR. KAMP:  I understand.  I was simply asking was
     there anything useful in those previously established terms
     as far as this effort?
                    MS. PUSKIN:  Well, metro/nonmetro is the first
     cut.  And then the Goldsmith variation is a cut on that.  It
     takes the metro and breaks it down further into areas that
     are really rural in character but are within metropolitan
     statistical areas.  So we did start with that.
                    DR. KAMP:  If we are sharing about unfamiliarity
     with acts, I'm unfamiliar with variations on the Goldsmith.
                    MS. PUSKIN:  Okay.  Well, we have a paper that
     actually relates to the last iteration.  We've just updated
     it.  But it's something that we use.  Why should you know?
                    MR. LAWLER:  Bill.
                    MR. BAILEY:  Bill Bailey.  I didn't disagree with
     what you said, Dena.  I just want to clarify one thing.  I
     heard you say sort of a minimum standard of 28.8.
                    MS. PUSKIN:  Oh, that was just thrown out.
                    MR. BAILEY:  Well, understand rarely does any 28
     modem run at 28.8.  The telephone network isn't designed to
     handle that.  Even in metro areas, they don't run at 28.8.
                    MS. PUSKIN:  I threw that out as just an example
     of what -- that it's very important to define what would be
     acceptable.  In my testimony, I must admit that I said the
     Internet -- access to the Internet at this level.  And I
     didn't define at what rate.  And that was an oversight that
     in some part was intentional because I don't -- I couldn't -
     - among the people, we had not really given enough thought
     to what would be reasonable.  But I think that's the kind of
     thing that really needs to come out of a group like this.
                    MR. LAWLER:  Jay.
                    DR. SANDERS:  Just one side comment, a for your
     interest -- for your information type of response.  That
     Paul Zimnik generated a comment about home health care. 
     There's no question in my mind that the primary site for
     health care in this country in the next five to ten years
     will migrate to the homes, so I'm in total agreement.  But I
     wouldn't be as concerned about the need for functionality
     because the reality is the functionality and the band width
     and the communication infrastructure to the home even in the
     rural area is already there.  
                    Most health care whether it's vis-a-vis the
     patient themself accessing it or whether it is the provider
     themselves accessing it will occur over the Internet.  And
     with web technology as it presently is, you're going to be
     able to do video conferencing over web technology.  The TV
     set and cable communication will afford that functionality
     right now.  If you look at what is happening right now with
     respect to cable modem, if you look at the improved band
     width that's going to be provided through direct access TV,
     a lot of the necessary health care needs in the home will
     occur through the TV set which, in effect, will become the
     telemedicine modality.
                    MS. DEERING:  I want to add to that something that
     happened fortuitously to be in the Washington Post this
     morning in the business section.  And it's short so I'll
     read it.  "U.S. Healthcare invested 25 million in a newly
     created company that would deliver health information
     directly to consumers over the Internet as well as through
     pagers, radio and traditional mail.  Teaming with Johns
     Hopkins, a university and medical system, it will manage the
     content", et cetera.  "U.S. Healthcare will own most of the
     new venture called Intelehealth."
                    I think what -- if we are concerned, especially in
     this hour of our discussion, about a definition of rural and
     behind that is a concept of equity, then we also have to
     realize that the big integrated delivery systems are going
     to do this.  But they're probably going to do this to their
     beneficiaries who may be in more concentrated areas.  I
     don't know.  And so if there's a concept of equity behind
     what we're doing and you want to ensure equitable services
     in rural areas, then you need to make sure that you're
     matching that level of service into the rural area.
                    MS. PUSKIN:  And let me just say that that means
     that you need that infrastructure there to deliver it over
     the Internet.  And I would suggest to you that right now
     that's not there.  And despite the fact that we may have --
     that we may see it evolve there.  And that would mean that
     there would be need over time for less subsidy.  But the
     issue is really defining what that basic level is for
     everyone.  Then you deal with all of these issues, at least
     at a basic level.  And I think that's what we're saying.
                    MR. LAWLER:  Gene.
                    MR. SULLIVAN:  Gene Sullivan, University of
     Virginia.  If you still have the business section of the
     Washington Post there, there was another article on GTE
     forming a partnership with U-Net (phonetic) to provide
     Internet access services to the 18 million GTE customers. 
     And I believe that if you do look three years out into the
     future, you're going to see that this is available.  Many,
     many phone companies are partnering with ISPs (phonetic) to
     give you the local dial service to the Internet.  
                    So maybe in that particular case, we're setting
     our sights a little bit low.  And maybe we ought to start
     looking a little bit higher as to what the requirements
     would be just as Dr. Sanders said.  The phone companies
     aren't the only ones out there.  If your standards are high,
     quite possibly there will be others that are very interested
     in providing this service such as the cable companies, such
     as the oil companies with their dark fibers (phonetic) in
     the ground.  So let's not think today what we need to do to
     provide medicine either to the rural clinics or to the home. 
     Let's think just a little bit down the road.
                    MR. LAWLER:  All right.  Let's do a couple more
     and then we'll let everybody get a cup of coffee and move on
     to the next one because we're just about running at an hour.
                    MR. ZIMNIK:  Paul Zimnik with the Department of
     Defense.  A couple of comments.  I agree completely with you
     that if we bear in mind what we are trying to do here, we
     need to remember that this is not an island.  We're not
     looking at -- particularly today and in the next five or ten
     years, health care delivery, telemedicine, is not an island
     unto itself.  We are talking about information aided
     technologies.  And there are market driven forces.  You
     know, we've seen what Paul Forder (phonetic) has said even
     about the third wave.  This is overtaking everything we do
     in society.
                    So as we sit here trying to define what kinds of
     applications, what kinds of infrastructure will be required
     for health care delivery, we need to be very careful not to
     fall into the trap of defining an infrastructure for a
     particular application or, in fact, I believe even for a
     particular industry like health care.  We need to keep in
     mind what is going on in the world, what is going on in the
     cable industry.  Web TV is another thing that just came out
     yesterday.
                    I believe if we move into the next hour talking
     about infrastructure development and such, that we'll find
     out even that health care type applications in the near
     future will require a minimum of six megabits a second type
     capacities.  And that kind of access into the home will be
     enables by processes that again are being caught up in this
     revolutionary change that we're seeing that's effecting
     every individual in society.
                    So we just at a philosophical level need to bear
     that in mind as we talk about making recommendations for
     implementations that we hope will sustain the needs of our
     country for the next ten to 20 years hopefully.
                    MR. LORAN:  My comment to -- Tom Loran, High
     Plains Rural Health.  I just think it's important for
     everyone to realize that there's a lot of people out there
     that still are on party line phones.  And they don't have
     cable service.  And all these things are really nice.  You
     can read about it in the paper.  And they dream from that. 
     So I just, once again, say lets not get so far out in the
     future that we forget the people that are still on party
     line phones and that there's a basic infrastructure in the
     rural areas that just doesn't exist and needs to be built.
                    MR. LAWLER:  Down on the end, and then we're going
     to take a break and move on.
                    MR. MCCONNAUGHY:  Just one comment on the last
     comment.  Party lines used to be a huge problem. 
     Fortunately, it's becoming less of a problem.  It still
     exists, I mean, no question about it.  But it's not --
     thanks to REA loans and public policy, it's -- well, it's
     something to be reckoned with.  But it's not the
     overwhelming problem that it used to be.
                    But the point I wanted to make, looking at
     Question 4 that the subcommittee addressed, I keep seeing
     the terms, "schools", "libraries", and "shared use", which I
     think is a terrific idea, not only in terms of the cost
     savings, but in terms of getting the total community
     involved, just a community access center as it were for new
     information.  I would suggest the subgroup look more closely
     at a specific part of the act which may or may not throw a
     monkey wrench into that.  Perhaps a creative interpretation
     would help here.  But I would say to look at Section 254
     HB3.
                    DR. BRICK:  H what?
                    MR. MCCONNAUGHY:  HB as in boy 3.  It talks about
     terms and conditions of public institutional users receive
     discounts -- some rock dollar type discounts.  The way it's
     termed, it specifies in the language that it cannot be sold,
     resold or otherwise transferred by such user in
     consideration for money or any other thing of value.  Now,
     resale and shared use has a long history before the FCC.  I
     was just looking to that for some guidance now leading
     through these waters.  But I think in a nutshell that the
     idea of shared use is a fantastic idea, but we may need to
     carefully navigate through the act to make sure that's a
     reality.
                    MS. POLTRONIERI:  If I might add to that recipes
     concerning the schools and libraries.  You who are working
     on that, that's very significant to talk about here.
                    MR. LAWLER:  All right.  
                    MR. MAXWELL:  I think that we can commit that we
     will be spending a fair amount of time within the FCC to
     explore what that means and what the restrictions on that
     are for precisely the reasons that you are suggesting.  
                    MR. LAWLER:  Last comment and then we'll move on.
                    MR. KIENZLE:  Mike Kienzle, University of Iowa. 
     Just one pragmatic comment.  That I'm sure some of my
     colleagues from West Virginia, Georgia, Kansas and elsewhere
     would agree that the fall off in expertise or technology, as
     you move into a rural community, it's extreme.  And I can
     tell you as an R & D director, I've had to send people 90
     miles just to replace a toner cartridge.  And so for us to
     be talking about future -- future digital services in a
     very, very rural setting, talking is one thing and doing is
     quite another.  
                    And the implications for the actual implementation
     of this kind of technology in a rural setting is immense and
     cannot be discounted.  And I so I agree with trying to look
     ahead far enough to try to anticipate the needs.  But at the
     same time, we still have people on party lines and we still
     have to send people out to replace toner cartridges.  So,
     you know, I would just urge a little bit of prioritism.
                    MR. LAWLER:  Well, if people want to get up and
     get a cup of coffee for one minute.  But let's quickly
     return and get back to the next one.
                    (Whereupon, a brief recess was taken.)
                    MR. LAWLER:  Tom, it's all yours.
                         INFRASTRUCTURE SUBGROUP REPORT
                    MR. SPACEK:  Okay.  First of all, I would like to
     thank all the subcommittee members for their inputs.  We
     sort of requested that, and I'll discuss that, similar to
     the set of questions.  And I was just amazed that everybody
     came back with, you know, three or four pages of very
     insightful comments within the time frame.  I never ask
     people who work for me to do things and expect that to
     happen.  You know, it was really good and we appreciate
     that.  And I'd also like to thank Sid Housein here from
     Bellcore for standing in while I was away.  I was away for
     the several weeks for the last two meetings.  And he helped
     out quite a bit.
                    Okay.  These are the topics that I know were
     covered.  Let me start with what we solicited from the key
     members.  We sort of came to the same conclusion as Jim. 
     Let's get some input from the subcommittee members.  And we
     asked them four types of things.  First was the kinds of
     telecommunications services that were essential for
     providing healthcare in rural areas to be included in the
     Universal Service Fund , inclined particularly to the word,
     "react". 
                    Next we asked well what are the infrastructures
     that's available today to meet those needs and what are the
     shortcomings, where aren't those needs met.  What are future
     needs for the next three or four years, and this is where we
     applied (inaudible) and where people brought up this home
     health care issue and so forth and expanded in that
     direction and several other issues.
                    And then we asked what were the barriers or
     providers to put the equipment in the infrastructure in
     reaching the rural and (inaudible) area and what might
     policy be to reduce those barriers although this was very
     preliminary in a sense that we believe that's one of the
     major outputs at the end of the flow.
                    Okay.  In doing that, we do have draft report
     here.  I didn't have it on the back table before.  I'll pass
     it out in a little while.  Sid pulled the draft report
     together.  And the attempt of this was to summarize the
     input as best as we could from the various members.
                    Now, I believe it was going to be summed in
     (inaudible), especially the ones that were found in this
     morning, but will not be included in this report but we'll
     work in as a working document.  But most of them we worked
     in as best we could, but we probably missed some.
                    So in our ongoing work of the subcommittee, we
     will not just use our summary report as source report for
     input, but use the original documents that you all heard
     (phonetic).  I'll also ask that the subcommittee members,
     and you can tell from the subcommittee, re-read this
     document because its significantly different from the one
     that we had two or three days ago based on inputs that you
     all provided.  And clearly, I'd like for the rest of you
     folks to read it, too.
                    What I'm not going to do today is summarize all
     those inputs.  Okay.  I've handed it out and you can read
     it.  It's only four or five pages.  You can read it on the
     plane or whatever.  What I'm going to do is highlight some
     of the key issues that were uncovered and that need to be
     addressed, and suggest an approach to what we've been told. 
     That's what we're going on.
                    With respect to the key issues, we solicited input
     as one of the essential services that were required.  We had
     some commonality in responses, pretty much commonality.  We
     had quite a bit of variety, just as Jim suggested.  And I
     think that mostly -- and there's a lot of reasons for that. 
     I think it mostly had to do with the way we asked the
     questions.  We basically asked for -- you know, what are the
     telcom services that should be provided.  What does that
     mean?  What does that have to do if you receive this input?
                    You have to make some implicit assumptions about
     the telemedicine applications that are required and the
     potential (inaudible) and the future (inaudible), and
     convert that or translate that somehow in your head into
     telcom service.  Well, that's not an easy thing to do.  It
     really takes a little bit of pressure to do that.  So I
     think that's one reason, that we didn't ask the question
     very well.
                    I think what we should have asked, and several
     people commented on this, is that we should have asked for
     what are the fundamental telecommunication needs that are
     required and to get an understanding of that, and I'll talk
     about that a little bit with this chart.  So what we really
     need is a framework for getting (inaudible).  And that's
     what I'll be talking actually talking mostly about, the
     particular framework.  And several of the members suggested
     that we do that.
                    The next issue was the boundary between essential
     and advanced applications.  And this has to do with what we
     were talking a little bit about before in some of the
     comments about what are the things we can do now and where
     are we headed in the future.  
                    In 254 H1A, it talks about in a sense, services
     that are essential for health care.  And we need to define
     them.  The FCC needs guidance as to what we recommend.  And
     then 254 H2A talks about advanced services that aren't
     necessarily in the initial universal service set, but that
     the FCC would like to know about because they want to set up
     some rule for competitive -- some competitively neutral
     rules for access to such services in the future and make
     sure you can evolve to that.
                    So we had the issue of how do you separate those. 
     And I'll discuss that in the next chart, too, because we
     have either a solution or a cop-out depending on how you
     want to interpret the chart.  Okay.  Next, the idea was we
     wanted to assure that whatever we recommend, that there is
     flexibility for evolution.  There were comments earlier that
     telemedicine application and considerations will change over
     time so we don't want to get locked in.  So how do we
     address that issue?  We have some thoughts on that.
                    Related to that is there were some comments on the
     issue of the definition of the telecommunication service,
     and it should be broader than pipes and the switches and the
     band switching and band width and so forth.  And it really
     needs to include the various protocols and data standards
     and software standards to some degree.  And I'll touch on
     the benefits of that later, too.
                    Also brought up this morning, the performance
     level of Internet access.  It was fairly -- fairly unanimous
     -- it may have been unanimous; I don't recall -- that
     Internet access was clearly something very critical for
     telelmedicine application, especially cooperative and
     information access in more places.  But there is a
     tremendous difference in T1 access and POTS access
     (phonetic) and what should be available where.
                    Clearly, lack of uniform coverage and reliability
     of the current infrastructure.  And that's kind of what this
     whole idea is about, is how do you solve that problem and
     get infrastructure into the rural areas at a comparable
     cost.  And then a whole series of economic elements, we've
     got a few of them here on economics and cost issues.  The
     last mile issue and the cost of the day (phonetic);
     incentive parastructures (phonetic), some people mentioned
     that today.  It's really what the difference in urban/rural
     cost differential and how to get a handle on that. 
                    And in some sense, it's not a matter of what costs
     are.  It's a matter of it's going to cost something to get
     service, to get the infrastructure to the rural areas.  The
     providers -- the beneficiaries of this line in the act need
     to get it for a comparable price.  The Universal Service
     Fund which we are not designing although we may give some
     input about what we think it's about -- I don't think we're
     designing an intelligence committee -- has to -- makes up
     the gap.  
                    So we need to put our objectives I think out there
     with recommendations.  And the designers of the Universal
     Service Fund can hopefully meet some of our objectives which
     will introduce cost issues because I don't think this
     committee can solve all of those pricing issues.  We have to
     get to what our financial objectives are anyway.
                    But there's lots of issues here.  Some folks
     brought up the issue of the economic realities of what can
     really get out there and be identified versus, you know,
     kind of we want it all even though the we want everything we
     can get now scenario may mean you may mean you may never get
     it because it costs too much.  So it's a reality out there. 
                    And then there are issues of stimulating the
     private sector investment to compliment Government funding. 
     And that gets to the issue of how much Government
     intervention is really needed or not needed.  So this is
     sort of a series of issues that are to be addressed, that
     kind of came up.  Some of them have been partially addressed
     by the inputs and some were just raised who were suggesting
     an approach to move forward here.
                    The first thing is basically to try to understand
     what we're doing.  We're making a bunch of implicit
     assumptions about what telemedicine's for and so forth.  And
     everybody at this meeting can probably make a good statement
     to that.  But I think we need to articulate it in a way
     that, you know, that the committee kind of agrees to; you
     know, (inaudible) patient to provider and so forth, just
     kind of obvious things about the -- you know, just moving
     distance and specialties that are not available and certain
     areas and so forth.
                    But I think there may be some different views of
     that.  But what are we trying to accomplish?  And I think
     that's put together relatively quickly.  And also in the
     goals, I think we might want to address this issue of
     flexibility, extendability over time.  The idea then is to -
     - what we need to do to meet those goals.  And the first
     thing that we think we need to do is try to understand what
     the applications are to be enabled by the Universal Service
     Act.  What are you going to do in telling us?
                    The kinds of applications I'm talking about --
     I've given some examples here.  These are -- you know,
     physicians and physicians consultants.  That may be with or
     without, you know, images and other -- other records along
     with it.  Remote diagnosis, and of course, there are several
     types of that; something as critical as in the triage
     center.
                    So these kinds of -- this is what we mean by
     applications.  And those applications are influences by
     several things.  One is the needs of different specialties
     differ and there are different applications for different
     specialties.  This can give some overlap, too.  They also
     differ by time delays.  And I'll mention that a little bit
     later.  What's an acceptable time to receive something
     because as we'll see, there is a tremendous cost difference
     in something -- getting something in a minute versus getting
     something in an hour.  Well, in some cases, an hour or two
     days is sufficient and in others it's not.  So we need to
     get a handle on that.
                    And as also mentioned this morning, the particular
     health care provider sight makes a big difference.  In other
     words, a hospital might have different needs and
     requirements for services than for a clinic or individual
     operator.  So these are the kind of parameters that need to
     influence these applications to some degree.
                    When we're talking about, you know, this
     distinction between potential and advanced applications
     which is the name of the bill (phonetic), the comments that
     we received are that the boundary is not going to be very
     clear.  We have a list of these various applications.  It's
     not going to be very clear where is the boundary that we're
     going to recommend these and say these are the future ones. 
     There's going to be a bunch of fuzzy stuff in the mill.
                    So we thought -- and the cost difference, too. 
     Clearly, some of the things that are more extensive will be
     on the list and some of them may actually be high priority
     and some may not.  So we thought that the best thing to do
     from the comments was to try to come up with instead of a
     boundary, a prioritized list.  And a prioritized list may
     not be exactly what we need.  It could be the first five
     things and the next five and something of that sort of these
     applications.
                    And why is that important?  Well, you give the
     joint board and the FCC some flexibility that way to try to
     include as many applications down the list as possible to be
     supported by the telcom services.  When they consider the
     shared costs, we may get inputs not just for us, but inputs
     from the education people and the library people and so
     forth.  So the whole idea is looking at that in the context
     of the national information infrastructure where you do have
     (inaudible) which in that infrastructure solves a variety of
     societal needs and as well as commercial needs.
                    So that was the idea of trying to get around this
     distinction to some degree.  The next thing you need to do
     is now once we understand these applications and the time
     frame and so forth, you've got to translate those into
     telecommunications services.  And what I mean by
     telecommunications services might be a little different in
     terms of vocabulary.  In fact, let me give an example.
                    In telecommunications services, I'm talking about
     things like store and forward file transfer as a need to
     meet a particular application; teleconference; fast type
     quality English transfer (phonetic); Internet access and so
     forth.  So what are those services (inaudible).  And then
     when we understand that, we can translate that into one of
     our primary outputs which was the recommended infrastructure
     functionality.                
                    And here is where we're talking about the things
     like band width requirements, switching and routing
     requirements, whether or not there should be an open
     architecture -- and I'll say a word about that -- and
     standards and so forth.  However, this is a process to get
     to these -- these infrastructural obligations.  The intent
     is to provide the recommendation in the aggregate form.  For
     example, potentially aggregated by facility like hospitals
     of a certain type need this or by the kind of hospital it is
     or something.  It might be aggregated by -- you know, it
     might be a different set for clinics than the things we're
     struggling with this morning.
                    So the intent is not that the FCC is given
     information like this and we put the burden on them.  I
     don't think we even want to think about asking them to come
     up with what are band width requirements for a particular
     medical service or feature.  That's not what we're
     intending.  The intent to give them recommendations in the
     aggregate form.  But in order to do that in a meaningful way
     with some logic and back-up as to why we're recommending
     this, we believe that we've got to understand what these
     applications and then what the telcom services are to meet
     those applications.
                    That's the basic approach that we're suggesting. 
     And beyond that in addition recommending what infrastructure
     needs might be, we also intend to make policy
     recommendations.  That's part of what we're being asked to
     do.  And the are policy recommendations that will remove
     barriers in order to get this infrastructure out there in
     the rural areas and at a comparable price as urban areas and
     not to mentioned underserved in urban areas and so forth --
     that's an issue that has to be dealt with -- and to assure
     that this is extensible over time; that we don't get locked
     in.  So what are the policy recommendations to all of them.
                    And finally what's below the line here that we
     really don't think are in the purview of the advisory
     committee, and this is to specifically specify what
     particular technology should be use and what the technology
     alternatives are.  I mean, some of these needs will require
     cable and some might require cable.  Some might require wire
     line, wireless satellite, who knows.  But here we're
     specifying the functionality that's needed to meet these
     needs.  Until it gets put out there, we don't believe it's
     in our purview to specify.
                    So that's kind of the approach of getting there. 
     A lot -- some of these steps have been at least started. 
     Okay.  And then just an example of what we're talking about
     to understand these applications.  This top part was pulled
     from one of the inputs using teleradiology as an example. 
     And there was one particular application for physician
     consulting.  And within that application, the idea was there
     may be several different key components even within one
     application.
                    And then we looked at a piece of market research
     that came out this year where a question was asked about --
     of the physicians, how long do you consider a significant
     delay in getting a pre-existing xray or pre-existing study
     in each of the following situations.  And these are the
     results of the survey.  And clearly if it was a critical or
     very critical situation, it wouldn't be a number of that
     sort.  So I don't know the exact definition of what that
     emergency setting was.  
                    But the point is here is not to analyze -- I mean,
     to, you know, question what the resulting surveys were.  The
     point is to realize that there are multiple applications
     within a specialty that will have different needs.  There
     are multiple time constraints and those will have different
     needs.  And we've really got to get a handle on that to move
     forward.
                    And this is just a picture of a teleradiology
     application.  And I'm not going to go through the details,
     but I just want to make one or two points.  We're talking
     about, you know, here's remote site here; accessing medical
     center that has a local area (inaudible) particular images
     stores and so forth.  Okay.  What we're trying to get at is
     in this circle here, in the network and the interface of the
     network and so forth, what are the requirements that are
     needed to meet this application need.  And there are a lot
     of questions you want to ask.
                    For example, a new network.  Do we want to push or
     make a recommendation that there should be an open
     architecture, for example.  We may not be able to do that. 
     What might the benefits be of that?  Well, it facilitates
     alternative technologies perhaps.  It facilitates
     alternative providers to be competitive with each other and
     things of that sort.  So that's the thing we need to
     consider.
                    Within the interfaces of the network, issues like
     data standards and interface standards so that it will allow
     interoperability among various vendors' equipment that you
     might want to buy.  So these are the kinds of things as well
     as the band width requirements and those sort of things that
     we're talking about.
                    And this is just based some work that's still
     being done.  But I'm not going to go through these details. 
     But there are some -- it's interesting -- points here that
     discuss the issue of cost.  Again, we're using teleradiology
     for an example.  And within this application, there are many
     different modalities, MRI, CT, ultrasound and so forth.  And
     within each modality in some cases as are listed here, there
     are different evolutions with the respect to the quality of
     the image and so forth.  
                    And those are relatively easy to translate into
     file sizes.  And then once you've got file sizes, you can
     look at various ways of transmitting -- there are many more 
     ways than are listed here -- of transmitting some of these. 
               And take a case here where you're talking about 
     five hours transmitted over POT (phonetic).  And I think the
     point is well made, 28 kilobits modem (phonetic), but
     specifically out running at about 21.6.  Anyway, you're
     talking five hours.  And on T1 over here, it takes five
     minutes.  That's a 60 fold speed based on what rate you're
     talking about, different prices in different parts of the
     country.  That might be a 40 fold -- only a 40 fold increase
     in price for 60 fold speed.  
                    The point is do you need it and the answer might
     be yes or it might be no.  And if you deploy something very
     broadly that costs 40 times more than something else, you
     know, is that -- does that make sense or not.  I'm not
     answering the question.  I'm saying we need to raise those
     issues in order to make our recommendations.  We need to
     know what's required, under what time constraints and
     examine the cost trade-offs in order to make our
     recommendation.
                    And then similarly, you can just extend that to
     that same kind of example.  And we've done a lot of this
     already.  So I'd rather it be somebody who will do the
     testimony -- extending some of this stuff to other
     specialties and applications, cardiology technology, health
     care, mental health and so forth.
                    So just summarizing, in addition to asking you to
     read the report which summarizes all the inputs, I think
     what we need to do is articulate what these goals and
     objectives are overall.  And I think that requires inputs
     from all the committees.  And potentially if the chairpeople
     are meeting later, we can discuss that.  We need to develop
     this priority list of essential advanced services that are
     enabled by the universal service set.  
                    And I think that's something that our
     infrastructure can do jointly with the rural committee. 
     We'll have the initial crack at it and go through the same
     problems.  But I think we can work together to get a handle
     on that.  And then translating those applications into
     telcom service needs.  The infrastructure subcommittee can
     take a crack at that.  With respect to the data standards
     and system hardware compatibility, I think that might fit
     more into the purview of the architecture subcommittee.  So
     we may get inputs there.  
                    Then translating telcom services into the
     infrastructure and concluding the extensibility issue.  We
     can take a crack at that.  And then based on all this stuff,
     and all of us have to work together and say what our policy
     recommendations in addition to telcom (inaudible).  That's
     basically what I have to say and here is the report.  And
     again, there were one or two comments that were phoned in
     this morning that didn't quite make it in, but most of them
     are there.
                    MR. LAWLER:  Yes.  Jay, do you want to start?  Are
     you done with this, Tom?  I'll turn it off here.
                    MR. SPACEK:  Yes.
                    DR. SANDERS:  Hopefully -- this will be an off-
     handed comment -- but I hope that in the final report, we
     don't include that example of teleradiology, that in the
     emergency setting we can allow 2.6.  My radiology colleague
     -- that was probably a survey amongst radiology, not amongst
     trauma surgeons.
                    DR. KAMP:  Semi-retired.  Just to get our
     attention.  This is a slightly more serious comment,
     actually, two.  One is simply to point out what a moving
     target we're dealing with on the example of teleradiology in
     terms of cost and time of transmission trade-off.  I would
     simply point out that the FDA just a few months ago gave
     pre-market approval for compression technology of wavelength
     pipe (phonetic) will upgrade 30 to 1 ratio which again just
     to emphasize how a chart of this type, however meaningful,
     when you're talking about the fastest thing is 6 to 1, it
     really changes the way we look at things.
                    Secondly, and just informational, the American
     Medical Association in its annual meeting two weeks ago
     adopted a ten page report on telemedicine which was really
     fairly informative.  It dealt with issues of standard
     reimbursement and licensure.  I realize some of these are
     not within the purview of this committee, but would be happy
     to get copies of that document for the committee if they
     would like.
                    MR. LAWLER:  Yes.
                    MR. POTTER:  Yes, thank you.
                    MR. TUCKSON:  Reed Tuckson from Drew University. 
     I appreciated the sensitivity and the underscoring of the --
     of the underserved urban areas.  I think that is very
     important.  I'm struggling to -- I missed the first meeting
     and so I don't know whether I'm behind on the curve here --
     of our definition of health care.  These services such as
     cardiology, pathology and so forth are very important.  But
     what also is important, particularly in urban environments
     and inner city environments is the notion of using this
     technology for promotion of health and prevention of
     disease.
                    Just as we've gotten the FCC act deals importantly
     with how to get lines into libraries and other such areas
     that are -- that, you know, are at schools where we don't
     have this capacity -- and to exclude, particularly in urban
     environments, comes the  notion of how we are going to be
     able to get communities involved and community-based
     institutions involved in having an opportunity for dialogue
     and innovativeness in terms of promoting health, defending
     against disease and earlier diagnosing disease in the people
     that live there.
                    So I hope at some point we'll add those things to
     this list of telemedicine issues and that we'll look at the
     health promotion and the prevention issues as actively as
     we're looking at some of the radiology, pathology,
     dermatology services.  And maybe we can come back and talk
     about that.
                    MR. LAWLER:  Cindy.
                    MS. TRUTANIC:  My name's Cindy Trutanic.  I'd just
     like to underscore that point from the perspective of the
     users of telemedicine for telepsychiatry and mental health -
     - mental health purposes.  There is a lot of talk about
     prevention in the mental health context and -- and having
     points of presence in a -- a school or a community center to
     really address, you know, adolescent and children's needs in
     the urban context.  And they certainly are under-served in
     many respects.                And I think that we should
     identify that as a need.
                    MR. KIENZLE:  Mike Kienzle, University of Iowa. 
     Just to again underscore the very broad definition of
     telemedicine, we define telemedicine to include a direct
     consumer source of information.  And our virtual hospital
     gets about a half a million hits a week, 40 percent of which
     come directly from the public.  It's interesting that many
     of the public come in on the virtual hospital for the -- in
     the information section devoted to patients and family
     members.  And most of them then migrate and read the
     information that is on the same illness that was intended
     for the -- for the physicians and other health care
     providers.
                    So clearly, there's a huge need and a huge desire
     on the part of the public to have information.  I think the
     Internet may turn out to be the platform that serves the
     broadest public good and certainly needs to be carefully
     crafted so that maximum access to the Internet on the part
     of the general public, particularly K-12 schools will serve
     as well.
                    MR. LAWLER:  Jay.
                    DR. SANDERS:  Jay Sanders.  I guess it doesn't
     need any more underscoring in terms of what Drew said and
     the subsequent comments.  But I probably can talk for Paul
     here vis-a-vis his comment about the -- in effect, the
     electronic house call.  Our total intent as a major reason
     for having access in the home is predominantly for disease
     prevention and health promotion.  And in fact, one of the
     initiatives that we've taken in Georgia is to integrate the
     health care telemedicine initiative into all the
     disconcerning sites in the states.
                    So along with the Spanish teacher and the advanced
     algebra teacher, we have our -- our pediatrician in the
     disease prevention mode discuss with the children
     preventative health, proper nutrition, anti-smoking, et
     cetera.
                    MR. MENN:  Eric Menn, Partners HealthCare of Mass.
     General.  Just as an extension of what Dr. Sanders was
     saying, in an integrated delivery system, it is very much in
     a capitated environment in our interest to keep people out
     of the hospital.  So it is economically reasonable for us to
     install telemedicine infrastructure as a vehicle by which
     you will keep people at home or with their primary care
     provider.  And that further (inaudible).
                    MR. TUCKSON:  The issue here, again, that's so
     important -- we come down to this discussion as we get into
     rural subsidization, who bears the cost.  And again, it's a
     matter of what -- the profits, not-for-profits, who pays
     those fees.  And there are a lot of us who are really
     concerned about the highway bypassing inner city America and
     how do you try to give a little bit of equity to that.  
                    And if it's just the folks who have -- who feel
     that there is an economic incentive to enroll patient
     population base, get access, that's one thing.  That's
     great.  And it's logical and it makes sense.  But those who
     are not enrolled in that population base with that
     particular managed care firm not still get left out.  And so
     I think you really hit the real issue.  And it really starts
     to get down to now this notion, as Mike said in terms of
     fairness of equity of access and the portion of
     subsidization and how do you make that happen.
                    MR. LAWLER:  Can I ask an ignorant question which
     -- in the rural -- and I'm sure that there's nothing but a
     generalization answer to this -- is the extent of capitation
     in rural areas getting anywhere near where it is in the rest
     of the country?
                    VARIOUS SPEAKERS:  No.
                    MR. LAWLER:  Is it a totally different
     environment.?
                    VARIOUS SPEAKERS:  Yes.
                    DR. SANDERS:  The basic problem that you're having
     and one of the things that telemedicine can help to
     alleviate is the reality -- is just the actuarial reality. 
     Managed health care can't go into a rural community.  Even
     if you have a 1,000 member rural community and all of them
     sign up for that managed health care entity, all you need is
     one catastrophic illness to totally wipe them out.  From an
     actuarial standpoint, it's a disaster.
                    However, what telemedicine can in effect do is to
     electronically consolidate ten 1,000 member rural
     communities into a single provider base so that you now have
     10,000 electronic members made -- in ten different
     communities.  And telemedicine will, in fact, facilitate the
     ability of managed health care to begin to market into rural
     areas.
                    MR. LAWLER:  Mike.
                    MR. KIENZLE:  You're not suggesting, are you, that
     the -- they're going to shear risk -- insurance risk
     electronically?  I don't think --
                    DR. SANDERS:  Not electronically.
                    MR. KIENZLE:  But even within a rural setting, the
     consolidation and integration that goes on, it goes on
     independent of whether managed care is in that state or not. 
     People are finding a lot of reasons to integrate within
     health care systems.  And so we're really talking about
     systems of care and I don't think we can assume that just --
     that this applies only in a capitated environment.
                    DR. SANDERS:  I agree with that.  I just wonder if
     --
                    MR. LAWLER:  Is the percent of those with
     insurance -- I think I do know the answer to this --
     different than in the rest of the population?
                    MS. PUSKIN:  There's -- I think there are a number
     of issues.  The University of Minnesota has done a lot of
     studies for us on the extent to which,  a) there is
     vertically integrated systems being developed out there and
     the extent to which they are undertaking risk.  And in the
     first instance, let me say that the extent of vertically
     integrated system is -- has not proceeded at the rate that
     they proceeded in -- in urban areas, but they are
     increasing.  But it is a much different picture.  And there
     are a whole host of reasons why.
                    The extent to which risk is being undertaken out
     there by rural systems is -- is quite minimal.  However,
     that is misleading because, in fact, you have a lot of
     people who are part of so-called managed care that are out
     there with their urban-based systems, but they really are a
     preferred provider organization.  But they're not really
     systems of care.  And so it gets very complicated.  What do
     you mean by managed care?  
                    And your original question was real capitation. 
     And real capitation where people take responsibility for the
     full health care of the population is -- is much less, much
     less out there.  And what Jay was suggesting is that the --
     the evolution to that will be enhanced by the availability
     of telemedicine for linking people.  I think it's by the
     availability of telecommunications technology which allows
     record transfers and allows sharing of information.  I think
     that is true, but I think it remains to be seen how fast
     that evolves.
                    And, see, it's very, very important to not assume
     that managed care is generically termed.  It's the same as
     really having really capitated systems.  And it's really
     only when you get systems in which you take responsibility
     for the population that you see really the full evolution of
     this technology or the full use of it occurring.
                    MS. POLTRONIERI:  Just to go to the point of the
     availability of telecommunications services, generally,
     Section 254 B3 of the act which is not the rural health care
     provision, but it is the broader provision -- broader
     principles for how the action works, Section 254 of the act. 
     And it includes support for rural high cost, low income
     consumers in insular areas.  And that is separate from the
     subsidy that we're talking about, particularly for rural
     health care providers.  But it's another part that's a piece
     that might fit in.  And if that part is done right, that
     should help facilitate getting the infrastructure out that
     you're interested in.
                    On a second point related to the definition of
     telemedicine and what was to be included in getting that
     definition to be broad enough, I just wanted to point out
     that 254 H1A allows for subsidy including instruction
     rendered to such services, telecommunications services.  And
     this is a very -- this is very particular to the rural
     health care part of the act.  It's different from -- there's
     no allowance for instruction in the school or libraries part
     of the act.  And that's something that we essentially want
     to keep in mind as you look at key definitions of
     telemedicine.
                    MR. LAWLER:  Art.
                    MR. LIFSON:  Well, just -- Art Lifson of CIGNA. 
     Two things.  One is I don't think if we just look at this as
     integrated delivery systems that are solely focused on rural
     areas that are developed in rural areas and somehow confine
     themselves to a rural area however that's defined, that that
     is, in fact, the total universe.  In many states, it's in
     fact integrated delivery systems that are in -- may have
     started in urban areas and move out into rural areas.  And
     this comes back from both a provider perspective.  
                    You may have an academic medical center or a
     tertiary care hospital that for its own business reasons has
     decided to try to get control over its inputs and
     establishes relationships with rural hospitals, physician
     networks, et cetera, or it could be an integrated delivery
     system sponsored by somebody other than a hospital that for
     the same reason is going out into rural areas.  That's point
     number one.
                    Point number two, managed care is different in
     different places and -- because there are different demands
     made and there are different needs.  And in many cases, it -
     - at least in our experience, it requires the adding of
     resources in a rural area in order to make this work rather
     than your moving into an environment in which there is
     excess supply.  Clearly in most rural areas, there is not an
     excess of supply.  And that, in fact, makes it a big
     difference.  
                    If I can make just one last point, somebody
     earlier in the conversation made the point about private
     activity and the incentives that exist for private activity
     to fill many of these gaps.  And I think that is real and I
     think it is happening for lots of different reasons within
     our health care economy.  And one of the things we have to
     be concerned about is in trying to meet the needs of this
     act, that we don't create disincentives for certain types of
     entities to enter a particular market.
                    For example, if you create such a huge price
     difference in the subsidies -- and I don't know, we've
     talked about subsidies here but I'm not sure whether we're
     talking about two percent of 25 percent of 50 percent and I
     don't know what the total cost -- what proportion the total
     delivery of that service that subsidy represents.  But
     assuming that it's significant and that it's large enough to
     move people, then you might -- may be preventing part of the
     capital from moving into an area where it might otherwise
     move.  And I think we have to be cognizant of that and
     concerned that we might be cutting off certain avenues to
     capital that would otherwise be there. 
                    MR. LAWLER:  Elliot. 
                    MR. MAXWELL:  Yes, I -- this is more an appeal for
     information and data.  Around the table, there are a
     numerous number of people who have done a rich of variety of
     things in the area of telemedicine or telecommunications-
     based health related activities.  We're not hearing I think
     as much as is known from your own work -- and I think it's
     sort of becoming increasingly available -- about the things
     that you are finding critical in doing it.  
                    And we sort of have the greatest pay-off at least
     in the experience to date.  And I'm very appreciative of the
     work that Tom has done in sort of analytically saying we can
     do all these different things.  But there really is this
     rich variety of experience that we need to sort of get into
     this mix.  I know that the vector work that Dena's work has
     been connected to has been trying to do some evaluation of
     that; what the HCFA work has been doing to evaluate this are
     all things that we'll make concrete what some of these
     services are that have the most immediate pay-off.
                    And I -- because of this very short period of
     time, I really want to encourage people to get that into the
     discussion because the discussion about how theoretically
     these telecommunications could provide these services is
     interesting and useful and helpful.  But we've got real
     data.  And where we have real experience if we're not
     tapping into that, I think we make -- we make a kind of very
     short term mistake.  This other part is very valuable for
     the long term, but I don't want to neglect that.
                    And because some of the people around the table
     are not necessarily sort of part of all these information
     gathering activities, what you can do to make real for us
     and to make sure we're getting the things with the most
     potential benefit as quickly as we can would be very
     helpful.
                    MS. PUSKIN:  Can I ask help with that though?  I
     think it's very important to articulate what the questions
     are so that then we can -- there is a lot of work going on,
     but it is not necessarily always targeted or relevant or
     maybe presented in such a way that would be relevant.  So if
     we could really -- and I think this is what Tom was really
     getting at -- the questions are then those of us who are
     actively involved with different hats might be able to bring
     our experience more efficiently to bear.
                    MR. MAXWELL:  That's perfect and it's more than an
     appeal on my part.  And I think that we are getting at those
     when we get at those questions and how to formulate them. 
     But because of this window we've got, I really hope that
     people will sort of jump in and say, you know, here's what
     we've done and here's what's had the most impact and here's
     the problem we've had.  We know there are problems about
     cost, but we also have these two kinds of interesting polar
     positions.  And they're not -- they're not mutually
     exclusive.  But they tend to drive you -- potentially drive
     disbursed results.
                    I think traditionally, it use to have been that
     the availability of information about prevention and health
     care education sort of has taken people in one direction. 
     Now clearly, that's increasingly available.  There are 2,000
     web sites about health care information.  People are -- and
     people -- sort of with the exception probably of money, it's
     the place that people are going most on the web to look for
     information.  Now, that's a very healthy, sort of in quotes,
     activity.  
                    On the other hand, at the high end of this, we
     talked about surgery and we talked about radiology and we've
     talked about cardiovascular work.  That's a very different
     kind of activity.  We need to be able to sort of an
     integrated way as a group make recommendations about what
     kinds of things are the things that will have the most punch
     to help in this area and are deserving of these kinds of
     support for the underlying telecommunications services.  So
     as best we can, if we can try to keep our minds on how to
     use our own experience in finding the most powerful of these
     tools, it would be great.
                    MR. SPACEK:  I'd just like to sort of second that
     with Elliot and Dena's comments.  I mean, the structure that
     I was talking about, the hard part of that structure is the
     part up front, in identifying what those applications are
     that will have the most punch that are the ones that we
     should be recommending to be included and so forth.  And
     there are going to be trade-offs, you know, and different
     points of view.  But that's the hard part.  And that's only
     going to come from your experiences with these things, what
     works, what doesn't, what the barriers are and so forth. 
                    The stuff we're proposing to do after that to make
     those translations are relatively straight forward.  It's
     not easy, but it's easier than -- than getting those
     applications understood and understood well and getting your
     -- those needs understood.  So I think we need a major focus
     on that up-front piece.
                    DR. DUKE:  I'm "Red" Duke.  I'm from Houston.  And
     pretty quick I'm going to expose to you how little I
     understand about what most of you all are doing or talking
     about it.  I'm a trauma surgeon and I've spent a lot of time
     trying to take care of folks in one way or another, both in
     rural and urban settings because we run a huge helicopter
     service over the whole southeast part of Texas.  So what
     we're talking about here applies to both groups.
                    I don't -- most people in this country haven't got
     the foggiest notion how big injury -- how big the problem of
     injury is.  It's the number one cause of death under the age
     of 44; number one cause of death of all premature injuries -
     - I mean it's the number one cause of all premature deaths. 
     We lose, you know, more people -- more per day -- more
     potential years of life each year from injury than we do
     from cancer, heart disease and infection put together.  But
     nobody thinks they're going to get hurt.  The trouble is
     they do.
                    And I'm sure everybody has heard of the 60 -- the
     golden hour.  But the problem is that's not 60 minutes. 
     That hour is as long -- it's directly proportional to the
     cross-sectional diameter of the blood vessel that's cut or
     how long you can get by with breathing with the airway
     you've got left.
                    We started working several years ago trying to
     figure out how we could get better information back to a
     medical center because if you're hurt and you've got a first
     responder that shows up at the scene, that may be a highly
     skilled inner city paramedic or it may be a volunteer basic
     life support person.  And until you get back to some center,
     your survival is dependent upon that individual's
     interpretation of what they see and what they can feel and
     maybe read off of data generated from some kind of monitor.
                    Well, what we've done is take some off-the-shelf
     materials like ProPak -- some of you might know what a
     ProPak is -- and modified it so that you can transmit, you
     know, like blood pressure, pulse, respirations and oxygen
     concentration.  And we've been able to do that from an
     ambulance.  And we tried to use compression techniques to
     transmit live video because this idea of a helmet which is
     going to occur within the next few years -- we've got, you
     know, a helmet like on the military -- the medics have got
     this where you can have an actual on-line realtime picture
     of what's going on at the scene is going to make a
     difference.
                    Every year -- last year I saw three people come in
     dead as hammers.  They had tension pneumothoraxes.  And I'm
     sure most of you don't know what a tension pneumothorax is. 
     But the way the paramedics are taught to treat that is with
     a needle in the chest.  The only trouble is the needles get
     stopped up and the people still die.  
                    If you can -- Jim and I were talking about it
     awhile ago, if you cut an artery -- there's no excuse for
     people dying of a major artery cut in an extremity.  But
     they do it all the time because the paramedics don't know
     what to do with it.  They cover it up and then after it gets
     red, they take a bandage off and put another one on it. 
     Well, you can just do that so many times before you run out
     of red.  It's real simple to treat that if you just use some
     head, you know; you know, use your kidneys up here.  But
     they don't get it.
                    And so the whole idea is we're trying to get good
     information back to a medical center where somebody can do
     it and actually guide them through some procedure like a
     crycothyroidotomy.  If you can't get an airway in, help them
     go through it because they don't do that every day.  But
     that can be life-saving.  What -- the reason that I'm am
     here is to suggest that in the division of this resource,
     that there be a commitment on a national basis to an EMS
     band.  And I don't have the foggiest notion how wide that
     thing is, you know.  
                    I mean, like I told Jim, I feel like I'm the only
     tree in a pack full of dogs around here.  I don't have the
     foggiest notion what ya'll are talking about and all that
     sort of thing.  But I can sure tell you when a guy's going
     to die or not.  That's all I've got to say right now, but
     I'll answer any questions.
                    MR. COTTON:  Greg, this is Steve Cotton from
     HealthNet, Texas Tech.  One of the things I have not heard
     talked about here this morning from either task forces we've
     heard from yet is are we going to provide information to the
     FCC and the joint board about how to define discounts so
     that all these wonderful things we're talking about can, in
     fact, happen?
                    As I look at the subcommittees, I'm wondering if
     that's more of a rural telemedicine -- you know, Jim Brick's
     group or perhaps it's an infrastructure.  You know, how do
     you incentivize the creation of this infrastructure?  But I
     think we can talk all day about what kinds of services need
     to be out there; who needs to have the services for what
     kinds of functions; how fast the compression rates and all
     of that.  
                    But I think if we don't address the issue of what
     is a discounted rate; what is an affordable rate for rural
     or for urban underserved inner city; if we don't provide
     some kind of input in that direction, I think we're going to
     be missing the boat and missing an opportunity to really
     help the FCC understand what affordability really means.  I
     know in Texas in the last session of our legislature two
     years ago, a year and a half ago, they struggled quite a bit
     with this question of affordability.  
                    And some of the phone companies would go to
     legislature and they'd say we're going to give you
     affordable rates; we're going to only charge $1,500.00 a
     month per T1 in your rural hospitals; we're going to do you
     a favor.  And the rural hospitals said, you know, we can't
     afford $300.00 a month.  
                    So I think this group has an opportunity to
     address the issue of affordable rates and discounts.  The
     FCC in their request for comment clearly indicated that it
     wanted some guidance in this area.  And I'm just wondering -
     - and I'm directing this to Greg or to Jim or to Tom -- is
     this an issue that you think can be, should be addressed in
     your subgroups or in the group as a whole?
                    MR. LAWLER:  The answer -- again, in two parts,
     the answer is yes, the law does provide some guidance.  If I
     remember it correctly, it's the -- and Jim, you correct me
     if this is wrong -- what it says is -- and you can call it a
     subsidy or a discount, whatever you want -- an urban area
     gets the same rate as a -- I'm sorry, a rural area gets the
     same rate as an urban area in that state.  So they --
                    MS. POLTRONIERI:  For the health care providers in
     rural areas.
                    MR. LAWLER:  Right.
                    MS. POLTRONIERI:  Right.  That's what's
     (inaudible).
                    MR. LAWLER:  So now, you know, that could mean a
     thousand different things.
                    MR. COTTON:  Sure.
                    MR. LAWLER:  But there is some -- you know, the
     law does say something that, you know, from the perspective
     of the law, we need to tell you what we think it means.  In
     general -- and I'll just use Tom's sort of structure --
     let's say we get through the, you know -- Tom's matrix and
     we come to a conclusion about precisely what we thing ought
     to be included and, you know, there is a question of
     affordability.  I forget where it is in your chart.  But
     it's in there somewhere.  
                    You know, we can make a recommendation that may
     not be included in the law that, you know, everybody ought
     to have a T1 and here's what it costs and it ought to go to,
     you know, this number of people.  But I do think we have to
     be mindful that that is what the law says.  Let me -- way in
     the back there.
                    DR. KUN:  I'm Luis Kun and I represent the Agency
     for Health Care policy and Research.  Some of the things
     that we do involve cost and medical effectiveness.  And I
     just wanted to point out a couple of items.  One is that
     it's essential in order to do those studies to have
     information concerning all citizens and not just urban or
     just rural.  And therefore, it ought to be structured not
     only to be beneficial for telemedicine, but also to start
     creating -- going with the model of the computer-based
     patient records that could be going to that infrastructure
     and do the studies more effectively.
                    Secondly, the incorporation of this data, it may
     perhaps improve the lifestyles of the people in the city. 
     Perhaps these studies can do comparisons between living in
     stress-free environments.  And there's a lot to be learned
     from those environments in other areas.  This (inaudible)
     prevention and fewer disease by focusing on wellness.
                    MR. LAWLER:  Cindy.
                    MS. TRUTANIC:  I just -- back to the other point
     about the charges for the access.  From the networks that
     I've talked with that are in, you know, rural areas, it's
     not necessarily the access or the inter connection that's
     killing them.  It's the transport element of the charge. 
     And you know, so you could have in one state, you know --
     say within Billings, Montana which is the Billings site that
     Dena has funded, they pay $300.00 a month within the
     Billings network.  And to their farthest site from Billings
     out to eastern Montana, it costs them $1,500.00 a month. 
               And so that that -- that cost structure is what's
     really making a difference.  If they can cost-out their
     equipment, they can lease purchase it.  It's the monthly
     charges that are really getting to them.  And somehow the
     subsidies that we talk about, we really need to get specific
     about what part of those subsidies end up getting -- how
     they're structured.  
                    And also the other point I made because they've
     asked me to make it is that the -- they feel that technical
     assistance is really an important element of designing a
     network and keeping a network updated and the efficiencies
     that you can provide with the technology that's emerging. 
     They don't always have the time to take out from saving
     lives to -- or whatever if it's a trauma care situation to
     really figuring out how to efficiently use the network that
     they're provided and that is an important element in keeping
     down the cost of actually practicing the teleconference
     services.
                    MR. LAWLER:  Right.  Tom.
                    MR. SPACEK:  I think with -- I mean, I think it's
     important that we try to understand, especially with people
     who have, you know, under -- underserved and inner city
     issues and rural issues and so forth that we make
     recommendations that address and talk about some of these
     issues about -- you know, about cost and expense and, you
     know, we want to make this affordable to the degree that,
     you know, you have opinions in those areas to get this to
     move forward.
                    But I -- I think what the idea here is is that a
     line over a -- a high density line, high capacity line over
     a long distance may, indeed, cost more.  Okay.  So the point
     is it's not up to us to say how do you make from the
     beginning of the point of view, not from what you pay.  So
     we're not going to change that.  But -- but I think what
     we're going to -- what the FCC and the joint board is trying
     to do is differentiate saying as a regulate cost that
     perhaps is in a urban area, there's a regulated -- there's
     another cost that's in a rural area and there's going to be
     a subsidization to make up that difference.  Okay.
                    I don't know how helpful it will be for us to try
     to structure -- to come up with rate structures and tell
     them how to do that job.  There's some guidance.  I think we
     can give them principles that we would like; objectives that
     you would like to have with respect to affordability and
     things of that.  So I don't know if I'm clear or not, but I
     read that as what -- my understanding of what this Universal
     Service Fund is all about.
                    MR. LAWLER:  Right.  Bill.
                    MR. BAILEY:  Bill Bailey.  I -- I agree with you,
     Tom, but I don't think it -- we're talking a lot about the
     types of services that are available and so forth.  And I
     don't think we can -- it's hard to say what they are today,
     more or less what they're going to be a year from now or
     five years from now.  And I think -- I think the point's
     valid.  
                    Probably whatever we recommend should be flexible
     enough so that you say here's what -- here's the kind of
     things that should be subsidized -- and I guess that's the
     rural issue and the underserved urban areas whether that's a
     consideration -- and let the joint board figure out how
     they're actually going to -- who they're going to get the
     money from and -- but -- but in terms of who would receive
     the subsidy or how, I think it's important that we not limit
     it to any particular type of service; to rather say, you
     know, whatever's needed.
                    And again, the issue is one of making sure that
     rural areas don't pay more than urban areas.  Now -- and
     several people have mentioned it -- a significant component
     of that is the distance sensitivity of many of the telephone
     rates that exist out there today.  And that's something that
     I think we and/or the joint board is going to have to
     address.
                    MR. LAWLER:  May I just -- it even seems simple to
     me.  But something that I haven't thought about before that
     I heard people say this morning which is part of the rural
     problem, for example, is that the infrastructure isn't
     there.
                    SPEAKERS:  Right.
                    MR. LAWLER:  It's not, you know, we don't want a
     subsidy, we want the infrastructure.
                    SPEAKERS:  Right. 
                    MR. LAWLER:  You know, and how do you make those
     things work together which, clearly, you know, the law
     doesn't even think about.  You know, and maybe there's some
     way we can think about that to say, you know, here's a way
     to do that; you know, here's how you spool those two things
     together.  Obviously everyone -- I assume everyone here
     would say, you know, we ought to get the infrastructure
     there.  Okay, fine.  How can we do it?  What can we
     recommend to get you from here to there?  Steve.  I'm sorry,
     Jeanine.
                    MS. PUSKIN:  I know I made this point before.  But
     I just want to emphasize that the law does allow and does
     direct the joint board to look at rural insular, high cost
     and low income areas and going to individuals and provide
     support.  It's one of the principles of the 254
     implementation.  So while this scope is more on the rural
     health care provider part, there is -- there is a mechanism
     that I commented on previously.  There's a number of
     different models that are being proposed and different ways
     to do that.  And if people are interested in doing that,
     they can.  I don't know how broadly you want to set your
     sights.  But it's in the law.  It's there.
                    MR. LAWLER:  Bill.
                    MR. BAILEY:  There's a problem though in that
     portion of the law, at least the way I understood it, is
     addressing the provision of basic telephone service to those
     areas.  And what we're talking about here is beyond basic
     telephone service.  And the availability of the network is a
     significant problem that won't be addressed by the other
     section because virtually every place in the country you can
     get telephone service.  But that doesn't mean you can
     transmit video.
                    MS. POLTRONIERI:  That issue is up for grabs.  The
     definition of what services are going to be included in
     basic telecommunication services is something that the FCC
     specifically asked for comment on.  It's something that
     people are working on.  Now, in the past in the traditional
     old Universal Service Fund, you're right.  It was the basic
     service.  But, you know, this is a brave new world.  So
     people are presenting comment on that.  
                    And I also want to note that the part about
     affordable and low income, that's pretty much the first time
     that that's been introduced into the law and caudified. 
     There's been a lot of interest in that.  Congress is
     specifically addressing what are the agencies that are doing
     that and we're grappling with that.  That's a new set of
     issues for us.
                    MR. TUCKSON:  I want to make sure that I'm clear
     on these two points here.  Let's say that we recognize in
     our model of health care delivery that there's a significant
     accordance for prevention.  And we understand that -- that
     the use of cable in people's home will be, for example, a
     major opportunity for Americans to be able to access
     lifesaving health information, health and welfare
     information, earlier diagnostic stuff.
                    If you live in a public housing development, you
     don't get cable.  Now, you're therefore out of business when
     it comes to what a large number of Americans will be able to
     do.  So low income people living in public housing would be
     out of that.  Without -- I'm trying to genericize an example
     and I don't want to get too far out on it specifically.  
                    But in that case, would we not -- if our concept
     was that it was extremely important for -- given that where
     the world is going, is that cable lines and so forth through
     -- you know, had an opportunity to be helpful to -- in
     promoting health and preventing disease, that you were able
     to address some of those issues because they are low income
     people.  They are poor.  And they are disenfranchised.  Now,
     how do you deal with that issue?  
                    Or it could be -- the same example would be
     something where if now it's important -- and we recognize
     through this law that schools have the opportunity to have
     access to more than one telephone line for a school.  Now,
     I've heard Reed Hunt (phonetic) talk about this a lot.  You
     know, it makes no sense for schools to have all these
     computers connected to nothing because you've got one
     telephone line and the principal's on that.
                    Now, you can subsidize phone service for Vale,
     Colorado ski chalets.  But you don't subsidize in this
     country extra phone lines for schools to be able to connect
     to the Internet.  So this addresses that.  We need to do
     that conceptually for community-based institutions that are
     the focus in place by which health information can be
     disseminated.  So how do we subsidize or help or at least
     create an environment for them to have access to the lines
     and to the information networks?  Are those things under
     your understanding of the law within our purview of
     opportunity to comment on?
                    MS. POLTRONIERI:  It's a little bit different. 
     The law is bifurcated.  There's one part -- and if you look
     at the antherium (phonetic), there's one part that
     specifically talks about definitions of universal service,
     quality and rates, access in rural and high cost areas
     including low income consumers.  And that's a general how
     are we going to get access to people in these areas.  And
     there will be a report like this to provide that.
                    MR. TUCKSON:  Right.
                    MS. POLTRONIERI:  Then there's a second part that
     is the rural health care provider's part which is what
     people have been focusing on in this group more.  And that
     has to do with low income, high cost.  But that specifically
     is the rural help.
                    MR. TUCKSON:  So I mean at least in terms of the
     rule book, how do we decide to do it -- but it sounds like
     the field is a little open and that we have the opportunity
     to address this in the ways we feel appropriate.
                    MS. POLTRONIERI:  There's been a lot of comment
     already from you to the agency on all these issues.  And I
     think you should try to take these opportunities to figure
     out what the priority is and where you think they could be
     most helpful and what people are most interested in.
                    MR. LAWLER:  A couple of more comments and then
     we're going to -- Jim.
                    DR. BRICK:  I just -- I wanted to make one comment
     about -- you asked for sort of testimony or personal
     experience.  Okay.  One of the problems that we have -- and
     I don't think that this is unique to West Virginia; I think
     it's unique to -- or it applies to most places around the
     country -- and that is that we buy expensive equipment to do
     this stuff.  Okay.  And we also buy expensive computer
     equipment for data transfer.  
                    You know, most major medical centers and middle
     size hospitals in the country now are moving in bits and
     pieces towards this ethereal thing that people talk about,
     computerized patient record.  But we buy all these things. 
     And the boxes don't talk to each other.  This is a
     tremendous problem.  Okay.  And when you go and talk to the
     vendors, they'll say oh, we can fix that.  Okay.  And they
     have some consultant come in and he says he can fix it. 
                    Well, you know what?  I haven't seen it.  Okay. 
     And I would like for one of the committees -- I don't know
     if it's this one or I guess the architecture committee which
     is coming up this afternoon will talk about that.  Okay.  We
     need some serious stuff.  If we leave it up to the vendors,
     it's going to be forever or it maybe never happens that
     these things are not applied in a way that there are
     standards that you can make things talk to each other.
                    We really need this.  This is a medical issue. 
     And it applies to patients every day.  We can't afford to
     leave this to the whim of people when they decide that
     they're going to start sharing their code with each other. 
     This has to be addressed now.  And I think that that should
     be something that this committee should -- or we should make
     some recommendations about.
                    MR. LAWLER:  Gene.
                    MR. SULLIVAN:  Gene Sullivan, University of
     Virginia.  Just a question to our representatives from the
     FCC.  There was a statement made that the infrastructure is
     not available in many places throughout the United States. 
     Did I correctly read in the act that if a provider built the
     infrastructure, that that would be credited toward their
     payments of the universal service?
                    MR. MAXWELL:  That's one of the things that's
     being -- that is being considered.
                    MS. POLTRONIERI:  Yes.
                    MR. SULLIVAN:  So the incentive would be rather
     than providing dollars to the Universal Service Fund, that a
     small phone company could go ahead and put in the
     infrastructure, the backbone and that would become part of
     the credit?
                    MS. POLTRONIERI:  One of the issues to be
     considered is whether carriers should get the reimbursement
     pertaining to rural, high cost, low income.  That's -- I
     think that's how that's posited.
                    MR. SULLIVAN:  I would opt, and I suspect many of
     my rural colleagues would opt, that that's probably a good
     way to go to push an issue like that.  You get to give them
     the incentive to get in there rather than make them pay to
     put it in and then, oh, by the way, you've got to pay more
     money into the Universal Fund to help support it.  There's
     got to be a trade off.
                    DR. KAMP:  If I might speak out of turn, I want to
     be responsive to Dr. Brick's question.  There are more
     radiologists doing telemedicine than any other specialty. 
     We have been deeply concerned with the boxes not talking
     with each other phenomenon.
                    MR. BRICK:  Right.
                    DR. KAMP:  Dr. Steven Horii of the University of
     Pennsylvania has sort of led our charge on that.  We made a
     presentation to the General Accounting Office about it.  And
     we will share his work with the appropriate subcommittee.
                    MR. BRICK:  These fellows have worked really hard
     on that trying to get the standards.
                    MR. MAXWELL:  The critical piece I think is not
     where the standards are, but what you think made it possible
     for you to get standards that work together because it's --
     this is a kind of process issue and what we might be able to
     do in the process issue as opposed to --
                    DR. KAMP:  I don't want to belabor the point.  We
     have worked on that process considerably.  And in the
     specific boxes part, we've worked cooperatively with the
     National Electrical Manufacturers Association (phonetic) on
     that very point.  But we will be happy to share that.
                    MR. LAWLER:  Two more and then we'll wrap it up. 
     Paul.
                    MR. ZIMNIK:  Yes.  Real quick.  In the Department
     of Defense -- because we spent a lot of money addressing the
     issue that you're exactly talking about -- and again, it
     gets back to my previous comment, that we in our committee,
     even the health care industry is not large enough to drive
     standards.  Dicom (phonetic) is a great standard in the
     field of radiology or in the field of any image transmission
     type standard.
                    But we have -- as Jay said just a couple of
     seconds ago, if you look at the driving and the
     substantiation of standards, we need to look at the world
     around us right now.  And in fact, the reason why the
     Internet is such an important vehicle for us is its
     ubiquity, yes.  But it's also the standards.  It gives us
     the standards.  
                    So, in fact, from the DoD, everything that we are
     doing in the field of telemedicine, medical informatics
     exchange, database access will all be based on the standards
     that the rest of the world is telling us to use.  So
     everything we do in medicine now whether it's video
     teleconferencing, store and forward type technology and
     such, they are all "standards" that are being developed and
     utilized over the biggest standard that there is right now. 
     And those are Internet-based.
                    MR. LORAN:  Paul, it's important that we develop
     the Internet -- oh, I'm sorry.
                    MR. SONNENSTRAHL:  I'm curious.  Are you speaking
     of international teleconferencing?  What happens if there's
     a language barrier?  Do you get a translator involved?
                    MR. ZIMNIK:  Exactly.  And in answering that
     question, the fact that the Internet is growing the way it
     is, that right now the language of the Internet is English. 
     But more important than that, the world is accepting the
     fact that items like translation of languages and then also
     data structures are critically important and -- but again,
     for our uses, those tools and techniques of communicating
     around the world, of security paradigms, of video
     teleconferencing standards, those are being provided and
     worked out in the very large industry that is utilizing the
     Internet.  
                    So I think we in the field of health care will be
     forced to -- whatever we say, whatever we decide as a
     committee, whatever the FCC decides, we in the health care
     arena will adopt those standards that are being utilized in
     -- by the Internet because those are market driven effects,
     those are well factors, those are philosophical and
     psychologically effects.  That's what the world of
     information is coming to.  
                    So it -- my position and I believe that the
     position of a lot of people in the DoD is that we don't even
     have to think about this anymore.  We are -- we've accepted
     it to modify our health care informatics exchanges into
     modalities and protocols that are Internet based.
                    MR. LAWLER:  Who -- all right.  We've got one
     point in the back here, and then we're going to go eat
     lunch.
                    MR. ROESCH:  I'm Harry Roesch of the Appalachian
     mission.  We funded a lot of projects.  But most of projects
     and our networks are basically multiple service sector
     based, education, telemedicine, business, whatever.  But the
     issue that Dr. Brick brought up, we supported that
     particular project that he started a number of years ago. 
     And what we have found in the past few years is that as
     networks are starting to be developed in our 13 state area
     (phonetic), we're requiring that they come up with at least
     -- they have to have a fiscal plan in place to be able to
     set their plan in motion.  
                    But when they do it in a piece meal basis, phase
     1, phase 2, phase 3, we are concerned that different
     entities starting up don't get equipment that will not be
     interoperable.  And what we're now seeing is we're seeing
     systems that are operable functioning extremely well.  And
     what we see now which is unusual, we see an entire package
     come to us.  And it's a replica of something we've already
     funded because they know it works.  
                    And this is because the vendors that Dr. Brick is
     talking about really are not servicing the industry. 
     They're creating oh, yes, we can do it.  And then they get
     in there.  And we've seen systems that we had to go back
     into in several years and replace equipment.  And that's
     tragic.
                    MR. LAWLER:  Why don't we -- Lygeia has a
     housekeeping matter.  And then why don't we come back at --
     it's 12:30.  Why don't we try to be back at 1:30 -- 1:15,
     1:15.  Lygeia.
                    MS. RICCIARDI:  Yes.  A couple of items.  Before
     you go, I'd like to distribute to you some letters which we
     need to distribute for legal reasons.  They have your names
     individually as advisory committee members and they just
     explain your status as such and say that you are not, for
     instance, actual Commission employees.  They're in
     alphabetical order.  If we could just pass them around and
     you could just pick out your names, I think that's probably
     one of the easiest ways to get them spread around.
                    Second, by way of dissemination of information, in
     the next room over there which is Room 111, I've got copies
     of the testimony on health care which was given before the
     joint board in April and June, as well as some comments on
     the universal service proceeding that I thought might be
     useful and some reports on telemedicine.  
                    And what I would suggest is rather than having
     everyone sort of charge in there, I know a lot of people
     picked up some materials when they were in the back there. 
     If I could just have one representative from each subgroup
     go in there and make sure that you have a copy of everything
     in there.  And then when those four people have gone in, if
     then everyone could head in, that would be great.  And
     please do just keep it to one copy if you could.
                    Does someone want to volunteer from each group
     just so it's clear?  Preferably somebody who picked up a lot
     of this stuff.  Do we have a rural volunteer?  Excellent,
     thank you.  Infrastructure?  Just picking up papers.  Thank
     you.  Architecture.  Great.  And international.  Thanks a
     lot. 
                    One more thing, if -- Paul, if you're ready to
     just give us a moment here.  
                    MR. ZIMNIK:  Oh, sure.  Yes.
                    MS. RICCIARDI:  Paul has been kind enough to help
     us in setting up with the help of the Department of Defense
     a web site that we can all use to communicate more easily. 
     And I have the address here.  I'm just going to pass that
     out as he's giving us a real quick run-down of what the site
     is and what it can do for us.
                    MR. ZIMNIK:  Yes.  This is in reference to what we
     were addressing before, that we have a very short time frame
     to do a lot of things.  There's a lot of information on the
     Internet, a lot of information each one of us has
     accumulated in these various areas.  And to help facilitate
     the process of this advisory group, we've set up a web site
     for better distribution of information.
                    And what you have down there -- and this will be a
     relatively dynamic process as we move forward over the next
     month or two.  Right now, I'm in the process of getting a
     domain name assigned to it.  So you'll see that.  Right now,
     you'll see I've given you just the IP number.  As we move
     forward with this, you'll have -- and you'll see on the site
     the actual domain name once it becomes available.  And it
     will be automatically forwarded.  There won't be any
     problems with that.
                    For now, if you have information that you would
     like included, a number of -- and that could include either
     your sites or sites that you know of that would be valuable
     resources for folks because, again, in the spirit of the
     Internet, we don't need to reproduce all the information
     there.  Just give me the URLs to it or actual reports like
     the various subcommittee reports and any other information
     you'd like included on the site.  You can e-mail it to me
     or, as I said, if you have a site where you have this
     information, just let me know and we'll make sure that
     there's a pointer on it on this site.
                    If -- furthermore in addition to this, if there's
     an interest, we can make available a mailing list, a list
     server on this topic for people to better dialogue back and
     forth.  And if you do not have an e-mail account yet you do
     have Internet access, I'd be happy to provide you with an
     Internet-based e-mail account for you to participate in e-
     mail which I believe is the most important tool we could
     talk about here. 
                    And then, again, my focus here is on information
     distribution.  So please don't look to this site for a nice
     multi-media or a graphically rich type beautiful pages.  I'm
     not going to focus our efforts on that.  I want this to be a
     site that is accessible from people everywhere from a 14.4
     modem up to a T1 band width.  So I have a fairly robust
     infrastructure to take care of the demand here.  If you do
     have any comments or requests or Paul, that's a dumb way of
     doing that, please let me know and I'll incorporate those
     recommendations or changes into the site.  So thank you.
                    MR. MAXWELL:  I'd like to express our appreciation
     for your work in doing that.  It's a great help.
                    MR. LAWLER:  We'll be back at 1:15.  Thank you.
                    (Whereupon, at 12:30 p.m., the hearing recessed to
     reconvene at 1:15 p.m., this same day.)
             
       
       
       
       
       
       
                               A F T E R N O O N  S E S S I O N
                                                                  1:26 p.m.
                    MR. LAWLER:  We're ready to started.
                          ARCHITECTURE SUBGROUP REPORT
                    MR. TANGALOS:  We're going to take the hour or
     less to discuss some of the information we've gathered
     through the architecture group.  And according to the
     Chairman's instructions, the first half hour -- the first
     half of the presentation, we're going to go through the
     handout that you have right now with comments based on the
     proponents that submitted those pieces to us.  And in the
     last half hour, it will be open discussion based on what
     we've got.
                    Our goal --
                    MR. LAWLER:  Does everybody have a handout?
                    MR. TANGALOS:  Your getting it now.
                    MR. LAWLER:  All right.
                    MR. TANGALOS:  The first part should be 33 pages
     long.  The second part should be four pages long.  And the
     four page part says, "Mayo Comments".  My own team was late. 
     But we had -- the way this worked is we had a conference
     call on the 24th of June.  And I promised the group that
     whatever information they got to me by the 3rd of July would
     be back in their hands.  And so on the 3rd of July, we sent
     Lygeia the 33 pages.  And because I was out of town most of
     the time that we were on conference call, the Mayo team did
     not meet until after that and, thus, the four additional
     pages right now.
                    Our request to the individual members of this
     group were to provide as much written information as they
     felt comfortable on the topic of architecture.  Our goal was
     to provide today's session a smorgasbord of information that
     could be at a later time whittled down, more forcefully put
     forward and then drafted and crafted into a more precise
     document.
                    You'll notice that there are comments that range
     all the way from Australia to Sandias.  And except for Max
     Alexander's comments from Australia, I do think I have a
     representative here that can speak each of the issues.  So
     let us begin with the comments from Steve Cotton.  Steve is
     a member of our group.  These were questions that he sent to
     us and questions that we discussed through the conference
     call.  And I would say, Steve -- are you here now? -- that
     out of this arose an 18 point questionnaire that we sent
     around the country.  Steve, take a few minutes and walk
     through your concern and walk through your questionnaire.
                    MR. COTTON:  Thank you, Eric.  Getting our arms
     around the architecture issue is obviously difficult.  It's
     a pretty broad area just like the infrastructure area is a
     broad area and there are some overlaps.  But some of the
     things we tried to do on the information was focus in on
     some specific areas where we though maybe the FCC needed our
     guidance or wanted our guidance.  And this was really just a
     starting point for our discussions.
                    There were -- we started initially with these six
     questions:  1)  What are the problems in this telemedicine
     infrastructure area and architecture area?  Basically,
     what's broken; what's not working.  2)  What is the trend in
     the market forces concerning architecture issues?  Are there
     forces out there moving us in positive directions to solve
     some of the problems so that we ultimately don't need to
     address them or the FCC doesn't need to address them or are
     there some market forces that are going in the opposite
     direction moving us toward interoperability and user
     friendly architecture?  
                    3)  What is the status of current internation
     negotiations on the development of technological standards? 
     We needed a benchmark.  We needed to see where is the
     technology standards -- where are the standards today? 
     Where are they going to be tomorrow?  Where are they for
     teleradiology and all the other tools?  And there, again, we
     wanted to see that there were some trends that were moving
     us forward in operability or maybe there might be some way
     that the FCC could help incentivize the completion of these
     standards.
                    4)  Should there be some focus on the need for
     planned interoperability?  A lot of us in the field that are
     actually doing the consultations with remote sites and
     talking to vendors and integrating equipment are very
     acutely aware of the problems of the lack of
     interoperability.  And for new potential sites that are
     wanting to start telemedicine, a lot of people are very
     unaware, unskilled in what the technological situation is. 
               They have a couple of vendors they talk to.  The
     vendors pose solutions.  And the people in their ignorance
     which is understandable pretty much buy-off on the vendors'
     solutions not realizing that the vendor architectures that
     they have today won't talk with something that they may want
     to buy tomorrow to work another problem.  So we wanted to
     focus a little bit on that.
                    5)  Is there a role for the FCC to play in
     encouraging interoperability?  And this is a key question
     because the FCC as a regulatory body has some broad
     latitude, but it also has some obvious restrictions.  I
     don't believe it can tell a -- I don't believe it can tell
     the industry what kind of architecture specifically to
     design necessarily.  It may be -- the question we're looking
     at is is the FCC a (audible) or a (inaudible) regulator, or
     is the (inaudible) somewhere in between.  
                    And in our role as a recommending body, we've got
     to be careful we don't tell the FCC to go work a problem
     that they can't work, that they don't have the authority to
     work or that's really out of their domain.
                    And finally, how do we reconcile individual
     company's need for some proprietary architecture with the
     obvious need to benefit from interoperability and especially
     user friendliness.  As we have experimented in integrating
     different telemedicine equipment in Texas in our
     correctional health care program, for example, we worked a
     long time on what kind of architecture do you really need
     for that prison doctor.  And hand-held cameras versus
     cameras on the headset versus stationary cameras.
                    And we found that the initial architecture we
     designed at first was actually used in the field.  The
     doctors or the nurse practitioners were saying that doesn't
     work; it's too jittery; it's too shaky; we cannot go with
     that approach; we need this approach.  So user friendliness
     is an issue also that we are going to try to address.
                    From that list of six questions, I put together a
     questionnaire of my own really of about I guess 18 questions
     that I sent out to people around the country.  And responses
     are just now starting to come in.  But we're really looking
     at a lot of different issues and hope to get some more
     information.
                    MR. TANGALOS:  And Elliot, just for you we have --
     the cover letters that Steve put together was -- we are
     working on behalf of the FCC.  These are specific questions
     we'd like you to address.  And so hopefully, we'll have more
     of that basic information, you know, the hard and fast
     numbers.  And with that, let me introduce Bill England
     because Bill's on this committee, as well, and has sent out
     information to the HCFA telemedicine sites to provide
     information, as well.  Bill, do you want to update us on
     where that is?
                    MR. ENGLAND:  Yes.  Unfortunately, I was not able
     to participate in the conference area with the group.  And I
     sent this just a few days after our last meeting and really
     have not been able to get back to it other than to talk to a
     few of our sites.  The main thing I was wanting to get at
     was the level of sophistication of what they're doing, what
     kind of band width they're using, what sort of equipment, et
     cetera. 
                    I knew that -- and I think that Dena is not -- I
     think that Dena had to leave.  The Office of Rural Health
     Policy actually have a very interesting table that they have
     put together -- it's in the other room -- that talks about
     what their sites are doing and what they're costing, et
     cetera.  I was attempting to replicate that for our sites. 
     And I have not yet gotten that together.
                    MR. TANGALOS:  And I hope we'll be able to use
     some of that.
                    MR. ENGLAND:  Yes.  And, again, I wanted to get it
     in a format similar to what she has.  When I was making
     reference to the vector research project and the joint
     working group on telemedicine, I think we will have this
     soon for all federally funded sites that will have probably
     a hundred at least different sites, what kind of equipment
     they have, et cetera.  We'll get that to you as soon as it's
     available.
                    MR. MAXWELL:  Thank you very much.  
                    MR. TANGALOS:  Our group was pretty good as far as
     making the conference call.  There was one person who missed
     it.  Sonny Sonnenstrahl missed our conference call.  He
     walks in late and he misses our conference call.
                    MR. ENGLAND:  Where was he?
                    MR. TANGALOS:  He was out rafting and that was a
     good excuse because I think he was on the water at the time
     of the call.  And it brings to mind though that we would
     have done a TDY conference call if he were available.  And
     that would have been a new endeavor for us.  Sonny's been
     very good in dealing with us with e-mail.  And the
     communication lines have been very, very open.
                    MR. SONNENSTRAHL:  There's no water proof.
                    MR. TANGALOS:  Bill Bailey was also traveling at
     the time of the conference call but was able to join us for
     that conference call and has provided the next three pages
     of document.  Would you like to comment, Bill?
                    MR. BAILEY:  Sure.  I really discussed two areas
     in those three pages.  One area we talked a great deal about
     this morning.  I think it probably dealt more with
     telecommunications infrastructure than it did architecture. 
     But the point I was trying to make there and I think I made
     earlier today is that there -- competition is going to cause
     existing circumstances or existing differences between rural
     and urban area groups to get worse and it's going to result
     in a greater problem later on and I thought the FCC should
     be aware of that.
                    The next problem I talked about was one of
     interoperability.  And I have to admit that I came into this
     thinking gosh, this would be a great opportunity for the FCC
     to put down and solve the problem.  But some people I work
     with changed my mind on this and I decided that a certain
     level of interoperability is going to exist because to do
     otherwise would mean that you'd have to settle for the
     lowest common denominator.  
                    And, obviously, the joint board is going to be
     faced with an option of trying to provide some incentives in
     some form or another to help the interoperability problem
     through the development of standards and the adherence of
     standards through whatever mechanism it establishes for
     subsidy.  
                    But there's a trade-off there that they have to
     recognize, is they put their foot down and say the only
     thing we're going to have is standards, eventually it will
     not be as robust as it would be otherwise.  So it's just
     something they need to consider.  And that's basically a
     summary of what I said.
                    MR. TANGALOS:  The next set of comments come from
     the National Library of Medicine and Betsy Humphrey is the
     executive deputy director, I think.  That's what her title
     is.  They've had a particular interest in controlled
     vocabularies.  In the world of medical education that Jay's
     been involved with (inaudible) the National Library feels
     very strongly having funded a number of telemedicine
     projects, as well -- feels very strongly with this project
     on uniform medical language.  
                    And you can see from her remarks, that they
     believe that telemedicine inventions need to be recorded as
     patient data, and that the transmission of patient data over
     distance facilitating that usage is a form of telemedicine. 
     So all kinds -- they are broadening the definition.  
                    And I think the next paragraph with regard to the
     controlled vocabulary incorporated in the UMLS medithaurus
     (phonetic) is a good idea because then you can start to
     search your own patient databases for diagnoses and look for
     patterns of care that develop.  So they have a very strong
     vested interest in telemedicine in general and with response
     to standards, a very strong interest in the uniform language
     that they are promoting.
                    I'm was a little bit desperate in going on to the
     next bit in getting enough information together.  And so I
     sent out not a broadcast e-mail, but I sent out e-mail to
     various places.  And one of my friends is Max Alexander in
     Australia who really actually took this quite to heart.  And
     if somebody has an Australian accent and wants to pretend
     he's Max Alexander, we can do that today.
                    But I won't go through all of his notes.  But his
     -- his responses to this were very pointed, very direct
     making a nice comparison to where the Australian system is
     and where it's tending to go which is closer to the U.S.
     system and where the U.S. system is and tending to go which
     may be closer to the Australian system.  And again, Elliot
     and Lygeia, I think we have some specific examples here that
     we will be able to carry forward.  And I see no reason not
     to include international examples.  And that will come up
     again as we come up to the final Mayo comments in terms of
     where we have difficulty in the international marketplace,
     as well.
                    MR. MAXWELL:  I actually just came back from a
     universal service conference where one of the issues has
     been the broadening of universal service obligations beyond
     simply single voice-grade (phonetic) circuits.  The
     Canadians are worried a good deal about education and some
     about health care, the Australians, the New Zealand folks,
     the Brits.  So there's a -- there is experience to draw from
     beyond our own.  I encourage people in this way.
                    MR. TANGALOS:  Dr. Duke, there are international
     emergency programs going on right now.  The G-7 has a
     Subproject 4 which is a 24 hour surveyance for emergency
     medical services.  And there will be a U.S. counterpart to
     that, as well.  So there really are interests are around us
     that we need to pay particular attention to.
                    Now, Dr. Kamp left our group.  He chose to go to a
     different subgroup.
                    DR. KAMP:  The pay was better over there.
                    MR. TANGALOS:  But you get your chance anyway. 
     And Jim Potter's been very good about providing us
     information.  And, indeed, what Dr. Kamp was talking about,
     Dr. Horii's work, we've incorporated here.  Would you like
     to comment further?
                    DR. KAMP:  Eric, I'll just be very brief.  I think
     the material in the handout is self-explanatory.  I'll just
     emphasize that DICOM was really focused with an emphasis on
     medical imaging, but we realize it may have some transfer
     value elsewhere.  If the logistics work and the staff is
     interested, we could have a -- a brief demonstration set up
     perhaps prior to our next meeting.  I think this is pretty
     well self-explanatory unless Mr. Potter who is our associate
     director governing installations (phonetic) has some further
     comment.  Jim?
                    MR. POTTER:  Briefly.  What you have there is an
     issue of where it's common.  DICOM is now a 13 year old
     project.  It's very well known in radiology because
     (inaudible).  And so they play with them all the time.  The
     word is really moving out.  Part of the information we got
     is now doing what's called an ISIS project.  And that's
     infiltrating all of the other fields of medicine using
     similar standards.
                    DICOM is based on a standard of information object
     definitions.  And they way it's set up is it's a very robust
     and expandful system where you can stack on new components,
     let's say, of a new specialty as a broad kind of layman's
     definition of how it works.  But we've also been working
     with all the international groups.  There's a text base
     image (phonetic) called HL7 that has now been incorporated
     into -- to DICOM.  The European CEN group that puts together
     the European standards, they have had negotiations for the
     last year and a half of DICOM.  And there to, now the
     European standard is essential DICOM.
                    The Asian standard, JIRA is now -- they've had
     negotiations ongoing for the last year, too.  So what you're
     finding is DICOM has become an international based standard
     for medical information and communication use.  It doesn't
     mean it's an approved project because it is a dynamic one. 
     It is always constantly moving.  And I think the core here
     among most of the participants is to create open
     architecture systems that work for everyone.  
                    The problem is while the expanse of this has been
     quite -- quite profound, we have most of the major
     subspecialties --
                    MR. TANGALOS:  Could you speak up just a little
     bit louder?
                    MR. POTTER:  Okay.  Sure.  We have most of the
     major subspecialties participating.  And I'll get you a
     little bit of information.  We also have NIMA participating
     which has over 25 of the major medical electronic
     manufacturers who have adopted these standards.  The problem
     is you have a lot of intermediate vendors who don't want to
     or are not knowledgeable or a lot of medical institutions
     who are not knowledgeable of these standards.  And so they
     have an incentive of their own to develop computer closed
     architecture or architecture systems that benefit them
     staying around for longer.
                    So while this is not perfect -- the perfect model
     is plug and play where you have something and bam, it all
     works together.  And that's not going to be there and it's
     never going to be there.  But the idea is to have some kind
     of dynamic role for the user as robust and with
     accountability.  The accountability now is in ANSI because
     DICOM is part of the -- ANSI's health informatic standards
     board.  They're a founding member of it and as now, they
     have delegated the responsibility for health informatics to
     DICOM or the ACRP (inaudible).  
                    All right.  Just to end it up there, this is
     really a subject that you can go on for days about.  I
     hesitated in bringing it.  But this is just the cover of the
     standard on paper.  It stands about yay thick.  I have it in
     my car but I didn't want to bring it in here because it
     hurts my arm.  It hurts just lugging it around.  So there is
     work that's been done.  The problem is just really getting
     that out to a much wider audience.  (Inaudible) medical
     subspecialty right now.  And it's beginning.  But we really
     need to get that information down to the individual health
     providers.
                    MR. TANGALOS:  In my request to the American
     College of Radiology, I asked for a version that was DICOM
     for Dummies.  So this is what we received.  Just so you
     know, we do most of our work by e-mail.  And this was the
     hardest document to receive.  It came as a cut and paste. 
     And were it not for "replace all function" within Word, I
     would have "end of line markers" everywhere.  
                    But we did accept anything that came in.  I edited
     it somewhat to dig out the superfluous comments.  You'll
     still see that we covered a large area.  There's lots of
     gaps.  But it's up to the subcommittee and anybody else
     that's interest to provide us with a substrate as we go on. 
     Elliot, did you have a comment?
                    MR. MAXWELL:  Yes, I was just curious as to
     whether it might be possible through the American College of
     Radiology to -- to ask ANSI and the health informatic
     standards board for any comments it might have about the
     issues that we're addressing and whether there may be useful
     things that the FCC could do in this area.
                    MR. POTTER:  I think that's something that we
     could re-lay on top of the various subcommittee structure.
                    MR. MAXWELL:  Okay.  Very good.
                    MR. TANGALOS:  This document as well is double
     spaced.  And it was double spaced intentionally.  I would
     love to get your handwritten comments back.  So it was
     intended to be this long as a work-in-progress for those who
     don't want to send an e-mail or have an electronic bit of
     information that you can include.  You can work off of this
     if that's stimulus enough.  
                    The subcommittee also experienced its own troubles
     with standards on e-mail.  We were unable about half the
     time to open documents that came to us.  There was another
     comment though that I didn't want to interrupt.
                    MS. KING:  Oh, I just want to follow up on what
     you said.  One of the questions that I would have is what
     changes would be needed for consumer promises equipment
     (phonetic) if any of this kind of material was brought
     closer to home.  It would seem that there is another issue
     there.  I think this was mainly the specialists talking
     within a limited network.  And that may be something that
     isn't translatable into a rural area and I'm not sure about
     that.
                    MR. TANGALOS:  John Linkus to go on was kind
     enough as executive director of the Telemedicine Association
     to provide me a daring testimony that was reported in PRM. 
     And Jay as president of the association, would you care to
     say anything at this point?
                    DR. SANDERS:  I think this is a fairly good
     summary of the issues that I thought were important.  The
     document, in fact, was generated by all members of the board
     of directors of the ATA, many of which are actively involved
     in telemedicine on a day to day basis.  We were very
     concerned in particular that at the very least, that we make
     sure that standards of architecture and standards of
     telecommunication of infrastructure be based upon what the
     end user's needs really were.  The end users here they
     define not only as the primary care practitioners out there,
     but also the patients.  
                    And we felt as a bare minimum, we needed Internet
     access in terms of the educational process, in terms of the
     store/forward process.  And we also felt as a bare minimum,
     apropo of "Red" Duke's comments earlier in the trauma
     situation, that at a very minimum, we need 112 kilobit or
     128 kilobit capability because when I have a deceleration
     injury of the aorta or if I have a tension pneumothorax, I
     need to look at that chest xray very quickly and get an
     answer -- get an answer back.
                    So we started from the perspective of yes, we
     would like to base it on the widest type of channel and the
     most functional capability.  But the reality is we need to
     deal with what the end users are doing right now and ensure
     that we have a basic bare minimum in terms of band width
     capabilities.
                    MR. TANGALOS:  Thank you, Jay.  I consider Suzy
     Tichenor from the Council on Competitiveness.  And she
     quickly responded with a wealth of information from a
     project that she was involved with through SANDIA.  You sent
     me a lot of information.  I chose to use this particular
     subgroup.  Would you care to comment?
                    MS. TICHENOR:  I'll just tell you a little bit
     about what SANDIA is doing and you can read the documents. 
     SANDIA National Lab. out in Albuquerque, maybe you're
     familiar with these labs, has developed an gaming process, a
     very complex economic model that simulates contracts
     business and economic situations much like war games.  And
     they have been developing some of these to test out business
     and policy and legal and economic situations that are
     national level problems in many cases.  
                    And they just inducted one focusing on the
     biomedical industry and biomedical technology.  And their
     objective is to try as a result of going through this gaming
     process to develop a biomedical technology roadmap.  And the
     information that Eric has included in here is one piece of
     the output that is being developed for that.  
                    This happens to be looking at a number of systems
     and architectural issues given that the experts of this game
     filed the heterogenous components in any kind of health
     infrastructure that would have to work together.  And given
     that, what are the -- what are the challenges that have to
     be worked out; what are the legal implications of those; and
     what are the policy implications.
                    Jay Sanders is chairing another one of the
     committees that is looking very specifically at
     telemedicine.  And there are about six or seven different
     subgroups.  And if you have a broad interest in this, I
     would urge you to contact SANDIA and get that.  And then at
     least as a start, review information that Eric's included in
     here.
                    MR. TANGALOS:  And they've been most helpful and
     are quite comfortable that anything that we've used can be
     taken and pulled right out of their documents.  They're
     delighted to -- they've been very helpful.
                    MS. TICHENOR:  It's extremely complimentary to
     what this group is doing.  And I think you'll find some
     information that's there that you can lift and use to
     support some of your work.
                    MR. TANGALOS:  The last bit then is the Mayo
     concerns.  And we have it divided up into comments and
     commentary.  And the troops were able to (inaudible) to put
     this together.  And you can see some of the costs that we
     incurred in terms of pricing for T1 lines, it's in here
     twice.  Pricing may indeed be tied to distance that it
     travels; so very, very highly dependent on the last model
     serviced by our local carrier whoever that may be.
                    One of the regional practices that we have
     purchased is in Decorah, Iowa.  We use U.S. West as our
     local carrier.  We use the MEANS Network which is a state-
     based network which is also very, very cheap.  And then once
     we get to the local exchange across the state line to Cedar
     Falls, it becomes a very expensive undertaking for us to get
     there.  You can see that the costs of going to Decorah, Iowa
     are more expensive than our T1 lease rates to go to
     Jacksonville, Florida.
                    DR. SANDERS:  Eric, can I interrupt just for one
     second because I think your work with MEANS needs to be
     underlined as an example of something that perhaps the FCC
     ought to push.  MEANS stands for Minnesota Equal Access
     Network System.  And it really is a consortium of 50 local
     telephone companies that got together and decided to put
     fiber in the ground in Minnesota and some of the peripheral
     states.  They did it in a very cooperative way and in that
     spirit, they also came up with very competitive types of
     rates.
                    MR. TANGALOS:  It's actually our way into the
     isolated world.  But we use it all of the time when we want
     a T1 access to the rest of the world.  It's kind of strange
     to say that we got our access anyway, but that's how we use
     it.  And it's very cost effective.
                    We go on and -- these were kind of the way we do
     business.  The Mayo standard for all of our connections to
     all of the regional practices that we've purchased are T1
     lines.  A quarter of that line is dedicated to video; one
     quarter is dedicated to data invoice.  Far more often when
     we're dealing with a non-Mayo entity, we resort to the
     lowest common denominator which is one-twelfth and we're
     lucky.  For our video conferencing if we get a 384.
                    One observation is -- and I think this is kind of
     key -- is that local carriers are still on the voice analog
     mindset where 56 kilobits is just fine.  But technically,
     the digital framework is in DSO at 65 kilobits.  And these
     routines are incompatible.  So it's an analog mindset versus
     a digital mindset.  And standards are different.
                    Mark Mitchell would like to be king for a day. 
     And you have the FCC ordered to switch multi-band megabit
     data service for everyone.  And it would compile ITU
     (phonetic) standards.
                    We talked about ATM not being tariff (phonetic). 
     High data long haul capability is still very spotty.  ATM
     supplies us with service, but it's not in many instances. 
     And this is an area that we thought certainly the FCC could
     get involved with.  Then we got to international
     compatibility and it's almost nonexistent.  Even ISDN is
     very difficult to get except on contract services.  Our
     Harvard people are here and maybe they'll want to comment on
     how they nailed down ISDN lines to carry out services in the
     Middle East.  We'll open that up in just a few minutes.
                    U.S. standard of T1 is 1.544.  The international
     standard is only 2 megabits (phonetic).  And again, here
     common activity resorts to the lowest common denominator
     which is not necessarily 1.544.  And then again, we were
     looking at some of the business aspects.  You pay for what
     you've ordered.  If your connection line is a T1 but you're
     only able to connect at a quarter T1, you're still going to
     be paying for the whole T1.  And according to Mark Mitchell,
     there are no bit counters and he wishes there were.
                    We feel that store and forward telemedicine is
     generally okay.  One way or another, the information is
     going to get there.  It's going to get there sooner or
     later.  It's the realtime stuff that needs a lot of help. 
                    In addition to equipment incompatibilities, there
     are lots of problems with lease lines outside of our home
     network.  It's very spooky stuff to go outside of our own
     network to get lease lines.  And, you know, if -- and not to
     brag, but if Mayo is having trouble with the vast resources
     we have available to us and the amount of time and effort we
     put in with a dedicated team to get the job done, just think
     about the rural provider.
                    Again, we talk about going out of the system being
     a real crap shoot.  And then the last mile and the local
     exchange whatever that may be seems to be the most expensive
     and the most difficult piece we have.  The commentary really
     is the same information in paragraph format with a couple of
     very good examples, as well, that we think are valuable to
     the FCC.  And we've attached the dollar amounts exactly to
     what our line costs are.  And then we've gone ahead and
     discussed the -- in very technical terms, the technology
     capability on page 3.
                    So that's what we've been able to accomplish so
     far.  Again, by no means complete.  Hopefully, this will
     stimulate others to send in more information.  And Greg, at
     this point in time, I'd like to turn it back over to you to
     give this working group further direction in the next half
     hour.
                    MR. LAWLER:  Do people have questions?  I have one
     if somebody -- actually, I'll start.  And this is directed
     at you, Bill, I think just at the -- what I think is a
     generally agreed upon or I've seen it not only from you, but
     from elsewhere.  
                    But the new competitive system is going to mean
     that there are rural -- costs of rural are going to go up
     compared to the costs of urban.  There's more money to be
     made in urban.  There's going to be more investment in the
     urban areas.  What is that -- I mean -- what I'm trying to
     imagine is a concrete what does that mean for West Virginia,
     for example.  Does that mean it's actually going to get
     worse in terms of the cost differential?     
                    MR. BAILEY:  Well, and we're talking about -- for
     the most part what we're talking about is data transmission. 
     And today for my company, data transmission at the T1 level,
     for example, you pay for the last mile and you pay mileage
     charges between those locations.  But those rates are the
     same throughout all of our territory in the state.  They
     don't -- I mean, anyone in the state would be subject to the
     same rates.
                    The cost of providing any telephone service is
     largely a function of distance and density.  So as you move
     away from urban areas, you've got longer distances.  You've
     got less dense population.  Costs go up.  And that fact
     means that the margins are greater for urban areas.  So
     there's going to be greater competition.  Prices are going
     to be driven closer to cost in urban areas.  
                    That means that if they're driven closer to cost
     in urban areas, there's at least a possibility that cost in
     rural areas for data services like that will not go down. 
     Okay.  I doubt that they'd go up, but they probably would
     not go down.  Even though -- I say today we have a disparity
     because of this distance sensitivity.  
                    Tomorrow you may have a disparity because you've
     got competition in a very metro area or even on this block
     of this city you'd have competition because carriers have
     the right to price on what we call an individual case basis
     or a large customer, they'll offer a price to cover their
     cost because they want the customer.  It may be very much
     below what some other customer might have to pay for the
     like amount of capacity.  So that's going to happen.  That's
     the dynamic.
                    MR. LAWLER:  And if, for example -- I forget uses
     a T1.  Jim, I think you said you do in West Virginia and you
     do in Texas.  What you're saying is that to the extent those
     costs are going down, costs to them of a T1 line are going
     down in an urban area.  They're not going down for them.
                    MR. BAILEY:  Well --
                    DR. SANDERS:  And I'm -- this is in general.
                    MR. BAILEY:  No, in general for my company at
     least, we serve large portions of the states we operate in. 
     And our costs are statewide average costs.  We come up with
     rates for everybody.  As you become more and more
     competitive in certain areas and you drive the rates down
     for that group of customers, you may find that while you
     have great -- well in excess of the cost before, when you
     drive them down through your more populous areas, your rates
     don't really cover the costs in the rural areas.
                    MR. LAWLER:  But if we had an urban versus rural
     cost now for the state of Colorado and we saw the disparity,
     what we're going to see is a greater -- in all likelihood,
     what we're going to see is a greater disparity in the
     future.                       
                    MR. BAILEY:  The cost will probably be the same.
                    MR. LAWLER:  I don't mean your cost, I mean the
     cost to the health care provider.
                    MR. BAILEY:  Right.  One of the points that I
     wrote there was that there may be differences today that
     exist because of -- because of the distance sensitivity of
     the rates.  But I think that competition is going to make
     that circumstance even worse.
                    MR. TANGALOS:  If we have someone from Rural
     Utilities, I'd rather they speak at this time.  If not, I
     think the analogy is that once upon a time, we had REA,
     Rural Electric.  Now we have RUS.  And I think it exists for
     very similar purposes of what we're discussing right now. 
     Back in the '20s and '30s, no one wanted to string
     electricity out to that last barn and light that last
     lightbulb because it was very costly for the electric
     companies to do that.  
                    And indeed, we've gone from REA to RUS I think
     with the same philosophy in mind.  Someone has to be out
     there thinking of that last telephone, that last ISDN line,
     that last whatever it is, that last provider down the line
     that needs that same service.  And it was very interesting
     to watch REA almost disappear and then watch the rural
     consortium say no, the job is not done.
                    MR. LAWLER:  Let me just ask then what we heard
     this morning is we have big problems in Colorado.  We have
     party lines.  Don't talk to us about fancy future.  We've
     got party lines.  How are we going to deal with that?  What
     -- connect that with your comment about the cost going --
     the cost not going down as they will in the urban areas.         
                    MR. BAILEY:  And circumstances vary broadly across
     the country.
                    MR. LAWLER:  Sure.  
                    MR. BAILEY:  In -- in Missouri for my company, we
     have fiber optics to connect every office in the state.  We
     have no party lines in the state.
                    MR. LAWLER:  Right.
                    MR. BAILEY:  But -- and we offer -- we offer basic
     rate or ISDN throughout all of our (inaudible) with some
     minor adjustments.  But when you get into areas that are
     non-Southwestern Bell which are significant --
     geographically significant areas around the state -- there
     is not other country offering ISDN at this point in our
     city.  There continue to be -- although it's a goal of our
     public service commission to eliminate all party lines in
     the state, they continue and I don't think will be
     eliminated throughout the state until after the year 2003.
                    And Missouri is probably in good shape when you
     compare that to Montana or some places a good deal more
     rural.  So I suspect the problems are even worse in other
     areas.
                    MR. LAWLER:  Is it -- does the new competitive
     environment mean it's -- there's less incentive to make it
     better quicker from an economic perspective?
                    MR. BAILEY:  Well, I think the new competitive
     environment -- let's say, companies like mine, companies
     like new entrants will likely spend their money where they
     can make money.  And that won't be -- at least early on,
     won't be in rural areas.  I think early in the process, much
     of the competition is going to be in urban areas.
                    MR. LAWLER:  Steve.
                    MR. COTTON:  Let me just dovetail on Bill's
     remarks by telling you what we did in Texas and what has
     happened because it's quite dynamic and it's quite promising
     I think.  The legislature a couple of years ago passed a
     House bill 2128 which Bill has heard of and is probably
     familiar with it.  But in exchange for deregulation, what
     the legislature said to the telecommunications community was
     we'll deregulate you or we'll deregulate part of our
     services, especially your future very high margin type
     services, if you will help build infrastructure in Texas.
                    And we want are distance insensitive rates and we
     want guaranteed access and affordable costs for advanced
     services.  And oh I guess six or eight months ago, I came
     across this brochure from Southwestern Bell, discounted
     rates for telecommunications services for schools, libraries
     and hospitals under House bill 2128.  
                    And Bill's company which has been a real pioneer
     in terms of trying to help make things really happen in this
     arena, not an obstructionist approach, but a cooperative
     approach -- Southwestern Bell is offering a price for T1 of
     $130.00 a month per channel termination, connection point,
     regardless of the distance between two locations that are in
     one lada (phonetic).  And that's $130.00 for a T1.  That
     tells me this can be done.  This can be done.  This mission
     here is doable.  And the private sector will respond if
     given the right guidance I think by the FCC and with the
     right cooperative spirit.
                    And I commend Bill's company for being in the
     forefront of this.  It doesn't mean all the problems have
     been worked out.  But this tells me the private sector will
     respond if they'll just get the right guidance.  And one of
     the things we did in Texas when we talked about what is a
     discounted rate, what they ultimately agreed was cost plus
     five percent which is the cost to that rural hospital.
                    MR. LAWLER:  Did you come to sell us --
                    MR. BAILEY:  No.  And I should point out that I'm
     not quite that good in Missouri.  I just filed a -- last
     week filed a tariff for distance learning T1 at a rate of
     $600.00 a month.  So it's available to any school in the
     state.  But we're also offering ATM technology for business
     learning at $1,380.00 a month.  So we're doing some things.
                    MR. COTTON:  And see, if you're a small hospital,
     you can't afford $1,300.00 a month.  You're lucky to afford
     $250.00 or $300.00 a month.  Some rural hospitals and
     clinics can't afford that.  But where there's the right kind
     of rate of the (inaudible) structure and incentives and
     political influence, it's happening.
                    MR. BRICK:  I just think that's -- this is Jim
     Brick.  I just think that's incredible.  Okay.  That's a
     whole order of magnitude difference than if you look at
     these numbers on Dena's sheet.  That's a whole order of
     magnitude difference, you know.  I just -- that's
     incredible.
                    MR. SULLIVAN:  That was -- and jumping across the
     border only about 40 miles from Jim there, the same
     question.  You know, $130.00 for a full T1 service?  That's
     --
                    MR. COTTON:  That's if you're in the same lada
     (phonetic).
                    MR. SULLIVAN:  Yes, I understand.  But even that
     is --                         
                    MR. BAILEY:  $3,000.00 if you go over.  And I
     would be remiss not to point that probably the result of
     what he's talking about there, my company got something very
     valuable for being willing to do that.  Okay.  One of the
     problems with legislation is that a number of those
     incentives have gone away because we got in Texas a good
     deal of freedom that we wanted through the legislature.  And
     one of the things I -- probably we agreed to do some of
     those things to help grease the skids you might say. 
                    But the problem is that some of those incentives
     won't be there tomorrow.  So companies would be less likely
     to be given incentives to do those sorts of things in the
     future than they are today.
                    MR. COTTON:  You need to follow that up.
                    MR. BRICK:  What did you get for this?  I mean,
     obviously, you made some kind of deal with the Texas
     legislature.  Didn't the Texas legislature only meet every
     other year?  The last laws are better, right?  But what did
     you get for this?             
                    MR. BAILEY:  Well, that's not the only part.  The
     Texas legislation, I mean, it does an awful lot.  But
     basically what it does is it deregulates the telephone
     company in the state.  I mean, that's basically what it
     does.
                    MR. BRICK:  Tell us what that means.  What do you
     mean --
                    MR. LAWLER:  The federal laws also change the --
     the telecom laws have changed.
                    MR. MAXWELL:  Here's the ECON 101, a take on this. 
     If you have essentially a monopoly provider who has relative
     freedom to price within some -- within some constraints and
     can take profits from one pocket, sort of much lower cost
     areas to serve because they're more dense and the runs are
     shorter, and take the earnings that they get from that above
     cost and say okay, I'm going to give something away at low
     cost, potentially at cost or below it, that's an easier
     thing to do in a monopoly environment.
                    Now, if I'm now saying there's going to be
     competition, then the question is where are the competitors
     going to come.  Are they going to come and say excuse me, I
     would love to give you $130.00 T1 or are they going to say
     now, I expect maybe in Dallas or Houston or Corpus Christi
     or Fort Worth that you were taking some money out of that
     market and giving away these T1s.  Or maybe I'm going to go
     into that market and price slightly above my cost, but it
     sure ain't going to be at necessarily the rates that you
     were charging in those markets as a monopoly provider. 
                    And so what -- a competitive environment is
     potentially at war with this notion of subsidy.  The
     difference is that this legislation with respect to health
     care providers in rural areas said we think it's real
     important to be able to have services that are essential for
     health care providers in these areas.  And we think it's so
     important that we're going to essentially tell the companies
     you ignore the cost differences because we'll make it up to
     you.  You don't have to worry that you're going to have to
     give it away or that you're going to make yourself
     vulnerable to competition.  
                    We're going to say that if you price it correctly
     in an urban area, we will subsidize the difference in cost
     that you might incur because of these longer runs and this -
     - and we're going to find a competitively neutral way of
     providing -- of making you whole.  So it's trying to say
     there is Economics 101.  It does work.  And that's why we
     keep kind of getting back to saying what are the services
     that you -- that you really think are important for the
     rural areas; then, what kinds of telecom pieces do you need
     for that; then what's the urban prices for that.  
                    And we can -- and the society will make this work,
     see, because the people will be taxed for that.  It won't be
     the monopolist who's got to go around with these funny
     prices and say -- you know, because the guy -- the guy in --
     in Corpus Christi probably wasn't getting it for $130.00 for
     a T1 a month either.  This was a deal.
                    MS. KING:  I would just like to say something
     about could this committee recommend that there be actual
     cost studies.  I think people would have more confidence if
     they understood what the real costs of these kinds of
     elements were.  And then that would -- I mean, I think
     that's missing from the Telecommunications Act, that -- I
     don't know if the states have authority on that any longer
     or not.                       
                    MR. BAILEY:  Sure.  The states do and -- I can't
     speak for every company, but in virtually every one of my --
     at least my competitive services, I have cost studies I've
     done.  What you have to recognize is that there -- for every
     person in this room, there's probably a different method on
     how you would do cost studies.  And everywhere -- every
     method would end up with a different cost.
                    I have cost studies for virtually every service
     I've produced based upon the way I'd like to do them.  And
     there are those out here who would say my methods are wrong. 
     But there are cost studies.  They're not -- they typically
     aren't made public though because they -- those are
     competitive services.  And I don't want to tell my
     competitor what my costs are because that gives my
     competitor an advantage.
                    MS. KING:  That's the irony of the thing.  If we
     want to recommend subsidies, where are we subsidizing?  I
     think that's one of the -- 
                    MR. MAXWELL:  I think, again, sort of the theory
     is going to be that you've set the conditions so that there
     can be competition.  And competition is going to be more
     likely to get services to reflect their costs than an
     environment in which you have a monopoly who is pricing out
     for some -- for whatever the profit maximizing strategy
     would be, and that it's more likely that that competition is
     going to come in areas that are a lower cost to serve.  And
     therefore, those prices will more likely reflect -- I'm not
     going to make any claim whatsoever that they will be at
     cost.  
                    But they're more likely to be related to cost than
     an implicit subsidy which is what we've had in monopoly
     environments where the pricing subsidies are disguised where
     nobody can kind of know because there's no one who is going
     to come in and say well, I can do it cheaper.  If you don't
     have that possibility, it's very hard to make sensible
     pricing decisions.  And you will have sort of not only one
     for everybody here, but one for any potential competitor is
     going to say how to do the cost and what I will do for you
     if I'm given the following things.  
                    So the idea is to try to encourage competition,
     encourage multiple providers, both in urban and rural areas
     because one of the things we talked about last time was if
     there are things that we can do to induce people to come
     into rural areas, we'd be delighted to do it because we
     think over the long term, that will drive down cost of
     services in rural areas, as well.  So we would love to have
     competition there.  And that's one of the aims.
                    MS. DEERING:  Mary Jo Deering, HHS.  I would like
     to take us -- I would like to ask you to take us to ECON
     101B.  My understanding is that in the new environment, it
     will also be harder for the FCC to project what the subsidy
     pool is -- is actually going to be.  Maybe that's not
     correct.  I think I heard that somewhere.  
                    And I'm wondering if you could talk us through
     what the -- the foundations of that subsidy pool are and,
     secondly, whether -- again, this is my ignorance -- whether
     there is a provision in the bill for given the undoubted
     fluctuations in revenues and subsidies especially as
     everything shakes out, whether there is any provision for
     recommending uses of surplus funds however the period -- the
     accounting cycle happens because I have some suggestions. 
     I've been asked to recommend some suggestions of there are
     moneys other than for straight subsidies.
                    MR. MAXWELL:  Would you like to answer this?
                    MS. POLTRONIERI:  Sure.  I think -- let me tell
     you what happens now.  We made the projection as to the size
     of the fund.  And then a factor objective, and that's
     (inaudible) to come up with the money for the next year. 
     Right now we're looking at ways to restructure the way the
     fund is collected.  But it will be -- the funds will be
     collected through telecommunications carriers.  There's
     different ways of doing that even through net revenues and
     gross revenues or (inaudible), a number of very complicated
     systems.  
                    But in terms of an extra fund, I don't really
     postulate that.  It's sort of -- we're thinking about
     (inaudible) and project how much that's going to cost.  And
     if there's too much money, we can go back and fiddle with
     the books a little bit.
                    MR. MAXWELL:  It's a term of art in the
     Government.  That's being recorded.
                    MS. POLTRONIERI:  If there were -- if we collected
     too much.
                    MR. MAXWELL:  People are not getting anonymously
     (inaudible).
                    MS. DEERING:  The only reason I asked, and I'll
     mention it here -- this wouldn't have necessarily been the
     appropriate place for it -- but HHS is supporting something
     that is called a science panel on interactive communication
     technology and health which is to begin to take a critical
     look at interactive communication technology, not the
     technology itself, but the applications that are delivered
     and to come up with a frame work for evaluating them,
     standards of quality, et cetera. 
                    And they're very interested in this -- in this
     activity.  And they wanted to suggest unofficially since
     they -- they really can't -- they're not in a position to
     make this official -- that evaluation be built into this on
     a couple of levels.  The first is is there any provision for
     the FCC to collect and publish how much access is actually
     occurring to these various things.  
                    I mean, what kind of data will you in fact be
     collecting about the conductivity and to what unit of
     provider will you be collecting?  I'm sure you have that
     kind of data collection, but to know -- to let us know in as
     much detail as possible what that is because for those of us
     who are concerned with access to the home and to the school,
     et cetera, we'd like to be able to factor that in to our
     assessments.
                    The second one is -- and I realize that this is
     beyond the purview of the -- of our committee and of the law
     -- is to what extent do we try to educate people about the
     importance of the content that goes over these pipelines. 
     We're looking at what specific services we want to recommend
     with the assumption that all of these services have value. 
     Again, I'm recognizing that it's not within the purview of
     this committee to try to evaluate whether the content that's
     delivered is actually doing what the sponsors of the bill,
     you know, thought it would do.  
                    But I raise that as a point of interest by this
     committee in saying if in any way this revolutionary
     initiative which is being unleashed could help foster some
     more critical sense of what the content of the health
     services or health information is that's being transmitted,
     that it would be valuable.  So thank you.
                    MR. MAXWELL:  Let me just take ten -- you know, 15
     seconds to respond.  Those are exactly the kinds of
     questions that seem to me that would be important for the
     committee as a committee expert about health in large
     measure as opposed to necessarily about telecommunications
     to be saying should be thought about by the FCC in its
     administration because it's not necessarily the way we would
     come at the issue.  
                    We know something about communications and
     something about tariffing and something about practices
     within the industry where you can come in and say this is
     the kind of service, this is the kind of, you know,
     evaluation that might be very helpful; is there a way that
     we can make sure that we, in fact, are working together on
     this as opposed to bifurcating to both -- the detriment of
     both.
                    MR. LAWLER:  Jay.
                    DR. SANDERS:  Jay Sanders, ATA.  Two things. 
     Number one -- and Steve and Bill, please correct me if I'm
     wrong -- one of the other very interesting aspects of Senate
     bill 2128 is the fact that it levies a tax on all the
     communication providers in the state of Texas to the tune of
     150 million dollars a year times ten years.  The fascinating
     thing to me of that 1.5 billion largess that the state of
     Texas has to create an infrastructure for telemedicine is
     that the people lobbying for it was the industry that was
     going to be taxed for it.  
                    And I cannot conceive that they did not lobby for
     it without doing a heck of a lot of homework like a business
     plan to figure out, well, let's see, if we're taxed X
     millions of dollars per year and we lay the infrastructure,
     is it possible that if we build it they will come.  And I
     would suspect that the answer to that was yes.  So there's
     some very interesting aspects of this -- of this Texas bill.
                    The second thing is a question.  When we began to
     build our infrastructure in the state of Georgia and,
     obviously, looking at the most inexpensive way to do it and
     to determine what existing resources were there, we were
     very surprised and the federal -- the state communication
     board was very surprised when we gave them an overlay map of
     all the fiber that was laid by Georgia Power throughout the
     state which the Public Service Commission in no way
     regulated and, in fact, in no way knew about it.
                    We had a very cooperative relationship with
     Georgia Power.  In fact, they funded a part of our original
     telemedicine initiative.  And they are very -- they were
     very, very willing to lease all the excess band width that
     they had for the communication infrastructure.  
                    Taking that, when we went into other states to
     look at what existed in other states, we found in just about
     every state we went to the same situation existed.  There
     was a huge amount of fiber underground laid by the power and
     light companies that nobody was using except the power and
     light companies, and a huge excess band width available.
                    What role if any do we have in trying to in effect
     hold hands with the power and light companies to help us in
     terms of the laying of the infrastructure?
                    MR. SULLIVAN:  Do you want to answer that, Bill? 
     If he doesn't want it, they can have it.
                    MR. BAILEY:  No.  From my understanding and I'm
     not -- I've dealt with some people at a particular operation
     in Missouri, the -- Springfield where the -- there the power
     company is owned by the city of Springfield and has a very
     elaborate fiber network circling the city.  And they've done
     that for the sole purpose of controlling their power
     network.  And that's the cheapest way they could do that. 
     And in the process, they created a great deal of excess band
     width that has virtually no marginal costs.  I mean, they
     can provide that to other people for very little additional
     cost.
                    And I will say that companies like Southwestern
     Bell view power companies as a very real threat down the
     road.  And I don't understand why they're not more actively
     involved today than they are.  I suspect that they are also
     regulated utilities and recognize that whatever money they
     make in their telecommunications provision would somehow get
     rolled into their electric provision and they'd probably not
     benefit a whole lot out of it.
                    So there's all sorts of motivations going on here. 
     And so maybe what you need to do is deregulate power and all
     of a sudden we'll have a lot of telecommunications.
                    MR. MAXWELL:  Just as an observation, the new act
     changes the rules that previously governed public utility
     holding companies which was a substantial impediment to
     utilities entering the power and light, utilities entering
     the telecommunications business.  And a number of those
     companies have come to the FCC under an expedited provision
     that exists to get into that business.  In a number of
     states -- California which I know reasonably well, the power
     and light companies have leased those facilities to long
     distance providers and other providers to offer service. 
               But it is -- one of the questions that has come up
     in the universal service proceedings in general and that
     clearly applies here is if there is to be a subsidy, who is
     eligible to receive it.  Is it simply that the local -- the
     incumbent local exchange company; is it any wireline
     provider; is it a wireless provider; is it any provider?  
                    So in fact, one of the questions would be would
     these people be able to offer these services and be eligible
     for subsidies in -- whether it's in the general universal
     service proceeding or in this particular proceeding or the
     educational one and, therefore, make it more likely that
     they will provide their facilities, make use of their
     facilities.
                    MR. LAWLER:  Just a couple more, then we're going
     to --
                    MR. MENN:  Well, I was just going to comment on --
     Eric Menn from Mass. General -- on what Bill Bailey said
     about electrical companies being players down the line.  In
     Massachusetts, the Massachusetts Turnpike Authority has
     created a fiber optic ATM link the length of Massachusetts. 
     And one of the founding partners of that was the Boston
     Edison Company because they want to be a major player down
     the line.  And I'm sure that's true elsewhere.
                    MR. LAWLER:  Down at the end.
                    MR. MCCONNAUGHY:  Well, another bite at the rural
     infrastructure development process besides discounting rates
     is NTI currently has an infrastructure grants program called
     T-Op (phonetic) which I think over the course of two years
     has been 60 million dollars in grants and I imagine fund
     basis which I think it key.  We need an incentive-based plan
     to -- to really make these things work.  So I think the
     grants are in 47 states.  
                    Somebody did a calculation where I think over a
     third of the grants have been given to rural areas and
     within those rural areas, of course, rural health care
     providers have benefitted.  So there's lots of ways to get -
     - part of the whole mosaic to get the rural infrastructure
     development whether it's (inaudible) loans, grants from
     various sources or (inaudible) discounts.  I think
     everything moving ahead on a (inaudible) I think will get a
     lot done in terms of getting the available infrastructure
     that's needed.
                    MR. LAWLER:  Cindy, go ahead.
                    MS. TRUTANIC:  I just have a very basic technical
     question.  Assuming that there's all this interoperability
     and the infrastructure is all there.  In terms of the
     applications, it appears that there may not be -- I mean, I
     know that the spectrum is finite and that the demands in the
     spectrum are going to be increasing exponentially and with
     all kinds of medical, educational and other applications. 
     At what point -- does it ask anything about prioritizing a
     spectrum allocation for health, education and whatever uses? 
               I mean, assuming we get 20 years down the road and
     we've got the same problem that we do with cellular service
     in that there's not enough band width to accommodate the
     demand, what happens?  Are we interested in that?
                    MR. MAXWELL:  That's something the group can
     address.  I think this is a curious situation with respect
     to rural areas at this moment.  And that is the FCC over the
     last several years has put an enormous amount of band width
     out into the market.
                    MS. TRUTANIC:  Right.
                    MR. MAXWELL:  There are essentially now for most
     every area, I think probably every area in the United
     States, as many as seven different providers with spectrum
     available.  Now, in most rural areas, there is either one or
     two rural providers of wireless service putting aside the
     educational spectrum that was available and others, but of
     things like cellular service.  The awards through auctions
     have taken that number up to seven.  And there's not the
     congestion that you now have in urban areas.  
                    So one of the things that we think is probably
     likely to happen in areas where there's great distance
     sensitivity, that someone will say I've got spectrum, it's
     easier for me to offer this in something akin to wireline-
     like services because I don't have the other demands on it. 
     And that -- that over the next several years, we might be
     seeing much more entry by wireless providers into rural
     areas because of simple costs of wiring these areas, even
     for new developments is such that they may be competitive
     economically.
                    So I think, in fact, what we will see -- and one
     of the reason why the notices were phrased as they were --
     that wireless providers may well be eligible for subsidy and
     wireless may have favorable economics for this.  And so we
     should be thinking not only traditionally the wireline
     providers, but what wireless can do in this area and how we
     might make use of that.
                    MR. ENGLAND:  Bill England, HCFA.  In terms of the
     way the subsidy works, one of the things that worries me a
     little is that if we -- the subsidy is sort of a monthly
     subsidy for a T1 line or whatever.  I mean, you can
     multiplex, you can do something that -- whatever you've got
     out in the rural area, twisted pair (phonetic) or whatever,
     you can get the T1 to a hospital or two hospitals.  But at
     some point, it's going to be cost effective to put fiber out
     to some small rural area.  
                    And then you've got -- we talked about it before -
     - this huge unused band width that could be used at almost
     no cost for other things.  So depending on how this subsidy
     is structured, it needs to be structured in a way that
     encourages the people that lay the cable to make that
     capital investment up front instead of just sort of doling
     it out monthly in a small amount.  You're not going to get
     the infrastructure being built.  And I don't know if that's
     something we ought to address.
                    But if you knew that guaranteed for the next ten
     years you've got a subsidy of however many thousand dollars
     to reach this community, and essentially the health
     community is going to buy band width even if it's not used
     through this subsidy and that could all be lumped to lay a
     cable out there, then you -- it's a better way of doing
     that.
                    MR. MAXWELL:  I think that's perfectly appropriate
     to comment about.  What you would like to have happen --
     clearly, the Commission would be happier than a pig in slop
     to get facilities out there.  The notion is not we like the
     idea of running these huge tax systems.  That's not the
     idea.  The idea is to try to make sure a) that we meet the
     mandate of the law and b) introduce competition where it's
     economically sensible.  And facilities out there is very
     important to be able to do that.
                    MR. LAWLER:  Just one last -- you've had your hand
     up.
                    MR. BUAS:  I just wanted to raise the obvious
     point that probably occurred to everybody; that if I send e-
     mail from my office upstairs to my colleague next door, the
     price is the same as if I send it to Australia.  That's just
     the pricing model of the Internet which is sort of bizarre,
     but it's magical and it's made an incredible phenomenon
     possible.  Now, whether it will be sustainable is another
     question.  But that's a cost mile that's not price
     sensitive.  
                    You go from the middle of Montana over 200 miles -
     - I'm just sort of saying that it's ironic that this T1
     pricing is distance sensitive right now whereas you can go
     across the world and you're not distance sensitive.  So I
     realize telepany has a long history; the cost model has been
     in place a long time.  But perhaps this other cost model
     will also come in, change the way people look at things, and
     have impact on this role play.
                    MR. LAWLER:  We now have our international
     subgroup.  And Ron is -- do you want to come down here or
     stay there or whatever?
                    MR. COLEMAN:  No, I think everybody ought to
     stretch.
                    MR. LAWLER:  I'm sorry.  Let's stretch.
                    (Whereupon, a brief recess was taken.)
                    MR. LAWLER:  All right.  Two housekeeping things
     before we start.  I see here some people are thinking about
     running out to catch airplanes and other things.  So let me
     just say we're looking at dates in September.  Not the first
     week -- not the week of Labor Day because that's always a
     bad week for everyone.  But either the following week or
     early the next week.  So if there are events in those, that
     second or third week in September that will keep a lot of
     people from attending, why don't you let us know quickly and
     we'll make sure that we avoid those dates.  And the best
     thing is to contact Lygeia.
                    MS. RICCIARDI:  Yes.  If you want to give me an e-
     mail or a call or something like that.
                    MR. LAWLER:  And Jay, you had one comment, and
     then we'll go to Ron.
                    DR. SANDERS:  Yes, one comment because Cynthia and
     I were talking about this during the very short stretch. 
     But in keeping with -- Paul's not here -- he probably should
     be if he heard my comment -- but in keeping with the idea of
     looking at where infrastructure already exists so that we
     don't recreate the wheel, in keeping with the idea of
     looking at the power and light companies, one thing you
     should know is that in the state of Georgia at the request
     of DoD, we piggy-backed a military health care system onto
     the civilian backbone that we had developed.
                    What about the reverse?  There is a huge amount of
     band width out there that the military has in continental
     United States that they're not using.  And they're spending
     a lot of money for that band width that's not being used. 
     Do we have any -- is there any role, can we make and
     suggestion that we begin a dialogue with the military with
     respect to the available infrastructure that they have that
     could be made -- or leased to the civilian sector?
                    MR. COTTON:  Jay --
                    MR. LAWLER:  I can't say anything with that
     comment.  So Steve, go at it.
                    MR. COTTON:  -- is this fiber in the ground?  Is
     this satellite capacity?  What kind of --
                    DR. SANDERS:  All of the above.  All of the above. 
     And there's a lot less need for dark fiber (phonetic).
                    MR. MENN:  I would just make the comment, Jay,
     that there is historic reasons why this would be reasonable
     because a long time ago the interstate highway was justified
     as a military necessity.  And we piggy-backed on that very
     nicely.  And there's no reason why the same argument
     couldn't be made in this setting.
                    DR. SANDERS:  Should we take a vote while Paul is
     out?
                    MR. MCCONNAUGHY:  At least on the spectrum part of
     the question, there is a shear thunder way that the
     Government spectrum band width there of currently being
     shifted on a phased in basis over to the private sector and
     the FCC overseeing it.  So that doesn't address directly
     your question.  I mean, that's just sort of a -- sort of a
     macro look at what's going on.  The Government spectrum is
     shrinking and it will be for the next several years.
                    MR. KIENZLE:  The Iowa National Guard has a
     subnetwork of the Iowa Communications Network.  And they
     have made all of the hours during the day when they're not
     using their network for military purposes -- which is really
     every day except weekends and, you know, every other weekend
     and two weeks in the summer -- for the public use of their
     video classroom.  So I mean, I think there are precedents
     for that kind of multi-user approach, even to -- even to
     military networks.
                    MR. LAWLER:  Ron, do you want to speak
     international?
                         INTERNATIONAL SUBGROUP REPORT
                    MR. COLEMAN:  Yes, thank you.  I'm going to remain
     seated.  I've got a bad leg.  I've been out of the country
     for about the last three or four weeks so it's nice to meet
     those of you who I have.  When I returned I spoke to I think
     all but one of the subgroup members.  So we put together a
     list of the international telemedicine issues, problems,
     that sort of thing.  I mentioned to Greg that we were doing
     this.  That most of the issues are not too complicated and
     they're really not in the purview of this group.  But we're
     going to talk about them anyway so I hope you're interested.
                    Those telcom issues -- and we're sending the
     outline around -- those issues that are telcom related, I
     will go through them briefly because we've spent the day
     already discussing it.  But the problems become exacerbated
     when your talking about international agreement.
                    Obviously, the first one is the availability of
     the appropriate telecommunications infrastructure in the
     various countries, not only in the United States, but in the
     various countries to support the provision of telemedicine
     services.  So that means not only domestically, but an
     international component and the domestic component
     (inaudible).
                    The second point is access to that international
     telecommunications infrastructure at reasonable and
     affordable rates.   And there we don't have groups such as
     the Texas legislature.  There will be the telecommunications
     ministry of Saudi with respect to those reasonable
     affordable rates.
                    We've also already talked about point number 3
     which is the adoption of internationally agreed standards
     and protocols with the necessary medical and telcom
     equipment services, an issue that again is -- is much more
     of an issue, much more exacerbated when you get to the
     international arena than it is in the domestic arena.
                    The fourth issue that's telcom related is the
     possible use of Internet-based services to support primary
     care providers in the developing nations; patient education
     and consumer programs worldwide; and continuing education
     programs for health professionals worldwide.  And of course,
     the major problem is all of this hangs on the availability
     of those various nations of the necessary hardware and
     software access and services that the providers in the
     United States provide.
                    Okay.  Those are the principal telcom issues and
     by and large they have been discussed.  The areas that are
     beyond the purview of this group where I think organizations
     such as the FCC together with the Department of State, the
     Department of Commerce and perhaps the Office of the Trade
     Rep. (phonetic) would be helpful is that when you get
     involved in international telemedicine, one of the first
     things that comes to mind is the existence of medical
     licensure requirements in the overseas vocation for U.S.
     physicians performing diagnoses or other medical services in
     the United States via the telephone line, already a problem
     in the United States and I see a recent article in the paper
     that the AMA proposal for uniform licensing in the United
     States has already been struck down.  So you can imagine
     what a problem we have on a global basis.
                    Another issue is the existence of foreign
     government restrictions, licenses, permits, et cetera, for
     the simple construction of telemedicine facilities in
     overseas locations.  These approvals can be a major barrier
     ironically, and especially in the countries that probably
     need the telemedicine services the most which would be in
     the lesser developed countries.
                    Another issue is the existence of important duties
     on medical and telcom equipment in the various foreign
     locations.  Getting the equipment there and into the country
     necessitates coordination between ministries of health as
     well as ministries of finance collecting the sort of import
     and duties.
                    Obviously, another major barrier to the
     proliferation of international telemedicine is the
     availability of local personnel, medical and technical, in
     the various foreign locations, and the overwhelming need to
     train such personnel.  So this will vary from country to
     country obviously.
                    Another significant point is the existence of
     appropriate payment mechanisms.  I know many of you in this
     room come from the nonprofit world.  My company is supposed
     to be a for-profit.  So the existence of appropriate payment
     mechanisms, insurance or otherwise, in the various foreign
     locations are very important as are restrictions on currency
     conversion and repeat provision (phonetic).
                    The availability of malpractice insurance coverage
     for U.S. physicians practicing telemedicine internationally
     is a problem.  It's a problem both with respect to the
     carrier in the United States and the possibility of coverage
     on the other end.
                    And I guess last but not least, in this whole area
     where the FCC can probably use held is there's obviously a
     role for the international treaty organizations such as the
     ITU and the World Health Organization, Government agencies
     in the private sector.  I know there is a study group at the
     ITU in Geneva on telemedicine.  (Inaudible) more study
     groups studying, trying to determine what telemedicine is. 
     So I don't look for anything to happen quickly out of the
     ITU.  Perhaps it can be a vehicle to face some of these
     other issues in the various foreign country.
                    I'd like to -- I told you I'd be mercifully brief. 
     I'm going to turn to each of the committee members for
     comment.  Let's start first with Mary Jo Deering.
                    MS. DEERING:  Thank you.  Actually, I was
     realizing an oversight that I alone have to be responsible
     probably for here, which is we've left out something that we
     can all relate to which is not health care delivery, but
     public health and epidemiology and the emergence of
     infectious disease and the whole information infrastructure
     for that.  And I apologize for not inserting that earlier. 
     In fact, it occurs to me that we've left it out of all of
     our discussions today.  And I would be certainly be happy to
     help that. 
                    And I appreciated the opportunity to add that
     emphasis on primary care and patient education worldwide
     because I think that clearly -- that those are -- that
     that's a spectrum of health care services that are not only
     appreciated in the developing countries, but increasingly
     due to cost containment also in the developed world.  So
     thank you.
                    MR. COLEMAN:  Okay.  Roger.
                    MR. GUARD:  I think Mary Jo just covered my key
     point.  Apparently, great minds think in the same direction. 
     And the consumer health patient education focus is what we
     added to -- 
                    MR. COLEMAN:  Eric Menn.  And I also want to point
     out that we have distributed a paper that Eric was kind
     enough to provide which was -- cites the experience of Mass.
     General and Cleveland Clinic Foundation in their 18 months
     of operational experience providing teleradiology services
     to Saudi and Jordan and Lebanon.  Eric.
                    MR. MENN:  And actually, the list is very, very
     good from my thinking.  From again an urban perspective from
     a teaching hospital, part of our mission on the
     international side we have told been by the administration
     of the hospital is to make a contribution to, as it were,
     the rural and underserved of the world because we are a
     teaching hospital.  We regard it as part of our mission to
     find ways to subsidize that with hopefully a created revenue
     source.
                    MR. COLEMAN:  Next, Dr. Sanchez.
                    DR. SANCHEZ:  Covering all these aspects, it's --
     all of it is that every effort has been made in
     international plans that were mostly successful in
     application, the Canadian project and others.  And that
     really meets with very little problem or opposition.  The
     implementation of disaster plans perhaps would be another
     area which has been addressed in different countries, Europe
     and the United States.  And the problems are almost
     unsurmountable when you get into a -- the so-called third
     world countries because of the problems of communication.
                    But also the infrastructure that everybody has
     attempted to build apparently sooner or later finds the way
     into private pockets.  And so if we are looking at helping
     building up a market for medicine in the United States or
     plain assistance, some of those issues which may include
     some degree of funding, at least the conservation, might be
     almost a loss.  It might be better to favor incentives and
     reduce tariffs, et cetera.  I'm not sure the economics
     support that directly because of the -- unfortunately, the
     corruption that exists in most of those countries.
                    MR. COLEMAN:  Reed.
                    MR. TUCKSON:  This is very good I think, as well. 
     I think the -- the notion of incentives is particularly
     important.  And the degree to which these initiatives can be
     coupled with other international business enterprises which
     I think is also an important opportunity, (inaudible)
     particularly for Vice President Gore has a number of
     international trade missions with other nations bringing in
     private sector in collaboration with Government energies. 
               South Africa is a good example of one that seems
     to be working fairly well.  And in this regard, in fact, we
     see a number of AID grants to try to have cooperative
     ventures with the United States health organizations to
     improve the infrastructure for the delivery of health care
     within South Africa.  This is a wonderful prototype and
     model I think for a public/private partnership across
     international boundaries that might need to be looked at in
     this context.
                    MR. COLEMAN:  Okay.  Bob.
                    MR. WATERS:  Yes.  I would just offer two
     additional comments.  One, I think the discussion earlier
     today about the sort of standardization of architecture and
     the efforts of folks like the American College of Reality
     and the DICOM Group is particularly important in terms of
     from an international perspective to the extent that as you
     get more developed countries and technology proliferating
     further down, that's going to be an important focus I think
     for us to make sure that we have as wide a standardization
     as possible.
                    Secondly, it strikes me that health care is one of
     our greatest potential export opportunities.  And that to
     the extent that we can utilize some of the capacity we have
     within telemedicine where there are sites that are engaged
     in telemedicine but perhaps they are not fully utilized
     using their equipment, resources, knowledge, that is
     something that other countries want, probably more than the
     product that we produce in this country.  
                    It's got real value added.  It's where we're still
     in a very dominant position.  I think we need to be thinking
     about that in terms of as another way to make the deliver of
     these products not only more widely available, but also in
     the end, perhaps more inexpensive for people in this
     country.  And there's a lot of applications that go with
     that.  And one need not look far.  But I think the Internet
     is a good situation -- a good example where there's a
     greater national demand to obtain health information and
     knowledge.  
                    And I'm fully aware of some personal situations
     where friends of mine encountered health care situations. 
     And in less-than-developed countries, they would have been
     eager to have consulted with any of the physicians that are
     in this room or any leading health care institutions about
     their problems because they just didn't have the expertise
     locally.  And we ought to be thinking about how to do that
     and build that into whatever models we create.
                    MR. COLEMAN:  Okay.  I'm just wondering to what
     extent do you think the liability issue that we discussed
     earlier for the physician in the United States practicing
     international telemedicine -- do you see that --
                    DR. SANDERS:  There is none.  There is virtually
     none.  First of all, by the decree of the Federation of
     State Medical Boards that has chosen in its infinite wisdom
     to suggest that over an interactive medium, in fact the
     physician is being transported to the patient.  In effect, a
     physician in the United States who is reading a fax of a
     medical record from Saudi Arabia would be defined by the
     Federation as practicing in Saudi Arabia.  
                    And since the Federation of the United States has
     absolutely no jurisdiction in Saudi Arabia, the point is we
     -- second of all, the overall liability or litigiousness of
     the rest of the world is a logarithmic order of magnitude
     less than what exists in the United States.  
                    Third, I think this committee would be amazed -- I
     mean, it would be very difficult for us to over-estimate, as
     Bob pointed out, the degree of interest, the degree of
     aberrance that exists in the rest of the world for our
     medical expertise.  And in fact, from a commercial
     standpoint, it represents a multi-billion dollar resource
     that has gone largely untapped in this country.  
                    One of the reasons you see the major medical
     centers in the U.S. like MGH, like Johns Hopkins, like Duke,
     like Stanford, like Cleveland Clinic, like Mayo -- is Eric
     still behind me?
                    MR. TANGALOS:  Yes.
                    DR. SANDERS:  Thanks.  Going into the
     international market is, number one, the legal and
     regulatory infrastructure that is so confining in the U.S.,
     is very minimal in these other countries.  Number two,
     there's a huge potential revenue strength that exists there. 
     So that's why a lot of telemedicine practice in the United
     States is being practiced internationally.  
                    You also need to understand the offsets or the by-
     products when partners or what -- what ATI was initially;
     it's now WellCare and soon to become WorldCare -- started
     with was wavelength compression, teleradiology over a
     standard Pots line (phonetic), analog line from Saudi Arabia
     because Saudi Arabia had not developed their digital
     infrastructure yet.  And they also started the actually
     started the United Arab Emirate also.  They started with
     teleradiology.
                    What happened was and what is soon to probably
     take over already -- it probably has taken over in terms of
     the largess of the revenue stream was the fact that really
     they're just faxing medical records for a second opinion
     from these countries to the U.S.  And even if someone like
     Roman Bisankus (phonetic) in cardiology at the MGH charges
     $500.00 for the consultation that he's read in a half an
     hour and gives a second opinion, it is a huge cost savings
     to that Saudi Arabian government rather than having to send
     that patient over.
                    Let me give you an example.  Three years ago, I
     met with the Minister of Health of the United Arab Emirate 
     in Awidadi.  And he told me they send 5,000 to 6,000
     patients per year at an average cost of $35,000.00 per
     patient abroad for such specialty consultations.  They're
     sent to Munich, Geneva, London, the United States.  
                    And the interesting thing was to look at a
     selective sample, a random sample of the charts, of the
     types of consultative needs they were requesting.  They
     needed dermatologists.  They needed ear, nose and throat
     doctors.  Eighty to ninety percent of what the patients were
     going abroad for could have been handled by in-country
     capability brought to them electronically.  They just don't
     have the medical expertise there for simple types of
     consultative needs.  So they send them abroad.
                    MR. COLEMAN:  But was that simply for medical
     services or did that include shopping?
                    DR. SANDERS:  Very -- very, very important point. 
     Very important point.  And it's funny and yet it's very
     real.  The reason that a -- that a company called HealthCare
     International went into receivership after raising
     $600,000,000.00 and putting a $400,000,000.00 coronary care
     center on the banks of a river in Glasgow was the fact that
     the people from the Middle East whom they were marketing to
     who could afford to go anyplace they wanted to didn't want
     to shop in Glasgow.  That is one of the factors that led to
     their demise.  And having to be two friends to -- both of
     whom emanated originally in the house of their training
     (phonetic) from the Mass. General Hospital.  
                    MR. TANGALOS:  If I may --
                    DR. SANDERS:  You'll get equal time for this.
                    MR. TANGALOS:  No, no, no.  Let's just embellish
     this.  But indeed, when we think about western medicine and
     a second opinion, that implies the United States.  I think
     part of the Glasgow business was that it wasn't west enough. 
     And in terms of some other store and forward activities,
     there's a project called MedJet right now.  And it's an
     L1011.  And it's equipped with four emergency suites, a
     complete ICU with extra seating available so that families
     from the Middle East can accompany their sick one to the
     United States and also have a cheap way of getting to the
     U.S., as well.  So that's a twice a week flight that's going
     to start up this fall.
                    DR. SANDERS:  I think we also need to be aware of
     the -- not only the interest and the amount of the
     incredible activity that exists internationally from Central
     and South America, Chile, in Argentina to -- and Mexico, two
     huge projects in Norway -- they have much more telemedicine
     consultations in Norway than we have in the U.S. -- to
     Finland to beginning in the circumpolar health group to
     Australia.  I was mentioning prior to this meeting that the
     state of Victoria has set aside over two million dollars in
     Australia, selectively set aside for telemedicine
     initiatives.
                    Interestingly enough, in the states of Australia,
     they have the same legal and regulatory problems that we do
     relative to interstate licensure.  And I would also suggest
     that there is a model in which that has been resolved.  And
     in the same way that the European Union nations do
     everything else in a unionized fashion so to speak, so do
     they do that with respect to medical licensure.  So if I am
     a medical graduate of a medical school in Belgium, when I
     graduate from medical school, I can practice medicine in
     France, in England, in any one of the European Union
     nations.  
                    The fascinating part about that as described to me
     by the president of the Royal Society of Pathology recently
     in Oxford is that -- he said Jay, it's ironic.  He said in
     your country, you have a common standard that everybody's
     expected to be responsible for.  And yet in each state, you
     have to get a license.  He said here in our different
     nations, we unfortunately do have different standards and
     yet everybody has the same license.  So on the one hand,
     there is a precedent for the internationalization of
     licensing and that's on a positive basis.  
                    But I think before we go out as we recently did at
     the ISAT (phonetic) conference in South Africa, the 41
     ministers of developing countries, to plead to them for the
     development of a communication infrastructure and to develop
     the legal and regulatory framework that would facilitate
     private dollars, private corporate dollars coming in to
     these nations from outside to develop these infrastructures,
     we had better do a little bit of developing yourselves
     because the legal and regulatory infrastructures we were
     asking them to create, we ourselves don't have.
                    MR. TANGALOS:  I apologize for that, but it's very
     upsetting to see some of the problems that we have in this
     country.
                    MR. LAWLER:  Anyone else?
                    MR. SONNENSTRAHL:  I'd like to back up to Number
     3.  Can I talk about a different issue here that related to
     Number 3?
                    MR. LAWLER:  Sure.
                    MR. SONNENSTRAHL:  Can I do that?  Okay.  I'm
     happy to see that you've brought up establishing standards
     and formal protocols for the necessary medical and
     telecommunication equipment.  But why did you use the word,
     "necessary", instead of all?
                    MR. COLEMAN:  It was just a term of art for
     whatever equipment is necessary to provide a service.
                    MR. SONNENSTRAHL:  The reason why I'm asking this
     question is because we may have a hard time defining which
     equipment is appropriate and necessary if you don't use the
     word, "all".  We have seven different telecommunications
     systems for deaf people in this country in the world.  In
     other words, I can't call France using my TTY here because
     we have different systems.  So if we're involved in
     something medical, then we have -- you know, we have
     problems.  So we're saying that TTY is not or -- no, is --
     is TTY a medical telecommunications device or not?  So if
     you use the word, "all", that would cut down all kinds of
     unnecessary red tape and make it clear.
                    MR. COLEMAN:  That sounds good.
                    MR. SONNENSTRAHL:  Thank you.
                    MR. LAWLER:  Any other international comments?
                    MR. MENN:  I guess the only other comment I would
     make, and I think it's been addressed around and about, is
     that most the things that we've found practicing
     internationally are that a lot of the protocols that we are
     being forced to develop, particularly we're starting to work
     on dermatologic imaging, will be applicable in the United
     States without having to go to the IRB clinical trial
     process, but that we will be able to simply lay them over
     existing practice standards.  And I think that will go a
     long way toward bringing primary care physicians to the
     telemedicine table.
                    MR. LAWLER:  Just one general comment and people
     can agree or disagree with this.  But I would view the
     international area of this as our role of advisor to the FCC
     we ought to interpret expansively because it's -- it's
     advice that the FCC can take.  And they don't have the
     direct ability to make it happen tomorrow.  They've got to
     go lobby others.  So I think in all these things, we ought
     to -- and I agree with all the things that have been said
     about the opportunity that it provides to us to -- you know,
     as an export to improve health care and all the rest.            So I
     think we ought to interpret our mission on the international
     side expansively unless Elliot jumps on my back and beats me
     here.
                    MR. MAXWELL:  No, to the contrary.  There is an
     effort going on right now within the administration to try
     to identify impediments to the development of advanced
     telecommunications services internationally.  And this is in
     part because of our belief that we are at the leading edge
     globally.  And therefore, these provide great commercial
     opportunities to us over time.  This is clearly one -- one
     of those areas related to that.  And so we have been working
     with other -- other elements of the Executive Branch to try
     to see where there were obstacles to the development of
     telecommunications-based services.  
                    And so this is a very fertile area for those
     people who are, in fact, involved in telemedicine
     internationally or in other uses of telecommunications
     internationally to come in and let us know what would be the
     best -- sort of the most important things to be doing.  We
     don't have much to say about licensure, but we do have a
     fair amount to say about market access and the ability of
     people to be able to get these lines and to be able to get
     capacity at reasonable cost.  So please do feel free to put
     this within the realm.
                    DR. SANDERS:  Jay Sanders and I apologize but I
     can't resist.  Once again, we as an administration and a
     country are seeking to utilize telemedicine to provide
     health care internationally.  And we also anticipate and
     fully expect that that health care consultation will be
     reimbursed.  Yet our own major administration -- Bill's not
     here.  I wish Bill -- no, Bill's gone.  I didn't plan for
     Bill to be gone when I said this.
                    But the reality is the health care financing
     administration in this country has chosen to decide that
     telemedicine should not be reimbursed because it's not
     occurring in a face-to-face fashion.  And they've chosen to
     define face-to-face as meaning physically in the same room. 
     And here all we've been talking about is the necessity of
     electronically transporting information.
                    MS. DEERING:  In defense as a HCFA representative
     who -- from whom HCFA was a black box until quite recently,
     under Bruce Vladek, HCFA has become extremely wired or
     wired-oriented.  And I think that given the unfortunate
     plaque that the administrations change periodically, one
     can't guarantee his continued tenure.  
                    But I wonder whether with sufficient time the
     types of attitudes and attitudal changes that he's -- I
     mean, that's -- that's quite a cultural change that's got to
     go in HCFA.  And it is under way.  In my own area, I have
     been absolutely flabbergasted to see the speed with which
     this change is occurring.  And certainly, it will take much
     longer in that area.  But I would like to hold that out as a
     light at the end of the tunnel.
                    DR. SANDERS:  I hope that within my lifetime -- I
     don't plan on leaving that soon.
                    MS. DEERING:  I'll keep the floor if I could
     though on one issue.  And it has to do with our look at
     international opportunities for telemedicine as a business
     opportunity for American medicine.  And I think we need to
     at least raise a couple of -- or one caveat here and maybe
     two.
                    One caveat would be that -- that this be
     undertaken with a spirit of cultural sensitivity because
     medical practices, medical attitudes vary around the world. 
     And I think that for us to export our medical practices and
     value into lease would be as imperialistic as the export of
     certain other products that are not welcome there.
                    And the second is really much more pragmatic from
     a public health point.  And it has to do with not displacing
     or weakening in any way or failing to help develop the local
     capacity.  For a public health point of view, we do not want
     to undermine that capacity.  We want to build it.  So there
     should be nothing that we do that supplants it or our
     competition moves in.
                    DR. SANDERS:  Just to go along with that, you
     know, it's amazing to me because while we're -- while we're
     trying to export telemedicine, I think we need to recognize
     that the major cause of death in the developing countries is
     starvation and infectious diarrhea because of the absence of
     food and proper sanitation.  They need food and sanitation
     before they need a neurosurgeon.  That's a very, very
     critical issue and we -- we shouldn't forget that.
                    The other thing we shouldn't forget is our advice
     may not only be viewed as imperialistic.  It will also be
     viewed as wrong.  And let me just give you a very quick
     vignette because when I -- about a year and a half ago when
     I was making rounds in Turkey in Ankara (phonetic) at the
     medical school, we were near the end of rounds.  And I hope
     I didn't mention this the last time -- last committee
     meeting.  And the professor there who was my host said, Jay,
     let's go off to the renal dialysis area.  And I'm thinking
     to myself what in the world is of educational interest in
     the renal dialysis area.  I know they all have renal
     failure.
                    And he said, by the way, before we go inside and
     see these patients, what do you think the most common cause
     of renal failure is in Turkey?  So as a turkey, I responded
     in the usual United States fashion.  And I said oh,
     diabetes.  He said no.  I said hypertension.  He said no. 
     And I knew I was in trouble.  So the most common cause of
     renal failure in Turkey happens to be a condition called
     amyloidosis.  
                    Now, amyloidosis as a cause of chronic renal
     failure in the United States is incredibly rare.  And what
     is even rarer in the United States is what caused the
     amyloidosis in the patients in Turkey, a disease called
     familial mediterranean fever.  So before we take our U.S.
     expertise abroad, we better be very knowledgeable about what
     the epidemiology of disease is in different parts of the
     country.
                    MR. LAWLER:  Anyone else?  Let's -- we are running
     -- well, we're not that far behind, but we're far enough
     behind I know people are trying to get out.  Let me just
     describe what -- where I think we need to go and arrive at. 
     We're going to try to get the subgroup heads together. 
     Somebody said they had to catch a plane.  I forget who it
     was.  But -- so we may accomplish that or we may not.
                    We have covered a lot of ground today and,
     obviously, the thing we need is to try to focus our efforts. 
     We have a -- as I said, we're going to try to meet in that
     second week of September.  We really need to have something
     at that point that we can meld together into a report.  It
     will require some editing and that kind of thing; probably a
     substantial amount just to make it work together.  But the
     effort really has to be at our next meeting we have to -- we
     must have something that people have read and commented on
     and gotten their comments back to their -- however, you want
     to do it -- to your subgroup heads.  
                    And it's all focused heading in the same
     direction, and that's not going to be an easy task given the
     fact that we're, you know, not all together meeting once a
     week.  What I would like to suggest and actually, maybe
     we'll just skip our subgroup meeting and just try to lay
     this out for everybody and see what -- see what the reaction
     is -- is maybe we should -- the subgroup heads and Elliot,
     Lygeia, myself, if we can do a call sometime early next week
     or whenever and try to get really an outline of work for the
     different subgroups to do so we have a -- you know, a clear
     description of -- you know, the rural subgroup is going to
     do X, Y and Z and the architecture subgroup will do A, B and
     C, and try to lay it out as carefully as we can.
                    There will be overlaps and that's really up to the
     subgroup heads to communicate and try to minimize it,
     although we're never going to get rid of it entirely.  But I
     really -- let's assume we can do that and accomplish that in
     the next week or so, week or ten days.  Then we've really
     got to figure out -- and this is any subgroup -- how we
     focus on the things that we really talked about today and
     try to get to the things that we think are important.  
                    You know, I -- and this is said knowing that there
     are different people in the room based on the conversation
     today who think different things are important and, you
     know, there's nothing wrong with that.  But I do think at
     the same time, we have to establish a focus or we're going
     to have a report that's all over the lot and not really that
     useful to anybody.  So -- and I'm happy to have a discussion
     about this.  
                    But I think the effort ought to be in the next ten
     days to come up with a real outline of what we need to cover
     in terms of each subgroup.  And then each subgroup has to
     organize themselves with the thought that they are going to
     have a -- a document ready for September that people will
     have read, criticized, edited, whatever the right words are,
     gotten back, had another draft of it go out however many
     times you think it needs to go and be -- be commented upon,
     and then get it out to everybody so we can come here and
     have a meeting about something that people have read and
     have opinions about; you know, I hate the fourth sentence or
     I love the fourth paragraph or whatever it is.
                    It seems to me if we don't undertake something
     like that, we will come here in September and we'll have
     another nice discussion and we'll not get very far.  
                    MR. ZIMNIK:  Again, I want to impress upon the
     group the value of doing this electronically as well with
     mailing lists and the web.  And again, whatever tools you
     think you need, I'm not at all implying that I'm the only --
     we're the only resource, but we're making that available. 
     So let's make sure we utilize that to its fullest potential.
                    MR. LAWLER:  Right.  Everyone has been enormously
     -- I mean, I've heard that from everybody -- that everyone
     has been enormously responsive in terms of, you know, a
     request for something goes out and there's very quick
     thoughtful response.  And we need to keep that up.  And I
     know vacation time and all the rest of it is approaching. 
     But in spite of that, I think if we really want to have an
     impact with the comments we make, the more focused we can be
     between now and the beginning of September, the more in fact
     we'll have.  Mary Jo.
                    MS. DEERING:  A question and a comment.  The
     question gets back to something that Elliot said today and
     that he said back at the first meeting which is that in his
     mind, the -- our work product was first to define the
     services that we want and then the telecommunications that
     will address those services or avail those services.  And
     really none of the sections specifically focuses on the
     bundle of services in reports that's come across in all of
     our discussions.  
                    And I wondered if you could give us some clarity
     whether we should all nominate our own list or whether
     you'll -- or whether you yourself see that there's one of
     those groups that should specifically articulate that,
     because, really, it has been sort of cross-cutting.  And on
     that note, I would like to volunteer something on behalf of
     Reed and I and I can't remember who else in the group.  
                    But one of the other cross-cutting themes that
     we've heard today is the concern with prevention, wellness,
     consumer health.  And we would volunteer to collect anyone
     who is interested in contributing to text on that -- on
     those issues as a set of materials to undertake to prepare
     that.  And I don't know how you would want it to fit in. 
     But again, it seems to be cross-cutting.
                    MR. LAWLER:  Yes.  Well, the answer to the second
     part of that is easy which is please do that and anyone who
     wants to join in should.  I think you're volunteering
     yourself to be the --
                    MS. DEERING:  Well, we are.  And I'm just saying
     I'd appreciate it if you'd actually post it on the web site.
                    MR. LAWLER:  Sure.
                    MS. DEERING:  And you can give my e-mail.
                    MR. LAWLER:  We will do that.  The answer to the -
     - the answer to the first part of your question is I really
     do think we need to have a discussion about precisely how we
     want to do that with the subgroup heads because, frankly, I
     don't know the answer.  I think -- you know, there are a
     bunch of different ways we can go and I have an opinion. 
     But I think we ought to have a discussion before we just say
     what it's going to be.  Steve.
                    MR. COTTON:  I'd like for us to have more guidance
     from Elliot, from the FCC standpoint.  And on that line,
     these four subgroups, you've asked us to comment on some
     very general things.  But I'm -- I think specifically it
     would be helpful to know what do you guys really want
     guidance on specifically.  Where are the big grey or the
     dark areas that you're going to have trouble with unless you
     get some guidance from us?  I mean, I'm not asking for an
     answer now.  But there ought to be one, two, three, four in
     each of these subgroups that at least would serve as a
     starting point for us.
                    MS. POLTRONIERI:  Elliot, I'd like to comment on
     that.  Is that okay?
                    MR. MAXWELL:  Sure.
                    MS. POLTRONIERI:  I think if you look at the Reg.
     30 (phonetic), some of the questions we've discussed today
     (inaudible) about defining rural.  We would be interested in
     your recommendations on that.  But I think they'd be --
     that's not going to be something that (inaudible).  There
     was a lot of interest in the record on what services and
     whether we should define services and functionality, what
     options -- specify what services we want or you could sort
     of leave it to the health care provider to pick each
     possibility and the definition.
                    There's a lot on the record on that, but we'd
     probably interested in hearing from you on that.  The issue
     of the discount methodology and how the subsidy will work,
     again, very interesting comments.  But I think that might be
     a difficult issue for this group to really tackle.  The
     definition of health care provider is something that has --
     is sort of up in the air.  We've gotten comment on it and,
     you know, it runs the range.  But that -- I think that will
     be a difficult question.
                    Instruction related to provision of
     telecommunications services, very important point there's
     very little in the record on it.  That's it.
                    MR. MAXWELL:  Let me sort of reinforce a couple of
     those and maybe add a little bit.  For many of you, your
     expertise is in the provision of this kind of activity and
     you're doers of it.  And to the extent that you help us
     understand what's working and what's not working, where the
     pay-offs are, that I think is very important and can be
     enormously helpful to us.  That goes not only in terms of
     the kinds of services, but the kinds of difficulties you
     face with respect to obtaining telecom services;
     differentials in cost, questions of interoperability and
     standards all are issues which I think can be helpful to us.
                    As Jeanine said, the training issues and the
     related issues to that are under-explored in the record for
     our purposes.  And we have an opportunity because of the way
     the law is written to think more creatively about that than
     we have in the past.  I think the -- what -- what we need to
     try to do is to get -- get a foundation -- well, a starting
     point so we get the starting point right.  And we can then
     talk about how this evolves gracefully.  And to the extent
     that you have thoughts about that, what you would do today
     without believing that sort of the world is going to be sort
     of an Internet-ready sort of convergent, multi-media world
     of five years.  What are we talking about now for use?
                    And then what we think about how this evolves and
     where we would like it to evolve and, therefore, what we
     might do to help an evolution that you think is positive or
     things that you think would be helpful because not -- we
     haven't talked very much about either of these kind of two
     poles; the kind of what happens when you've got a party line
     situation and you can't do things, as well as what you would
     like to have out of the -- out of the process in five years. 
     Because as we've said before, this is going to be an
     evolving process, not one that's fixed in time. 
                    MS. CONNORS:  I guess I just wanted to -- because
     you brought that up again about what works and what doesn't
     work.  And I wanted to make this point this morning and
     didn't have an opportunity.  But about a year ago, we went
     to Garden City, Kansas which is the southwestern part of
     Kansas to take Internet, our graduate full courses on the
     Internet for nurse practitioner students in that area.  
                    In order to do that, there was no Internet
     provider in Garden City.  So we ended up being -- the
     University of Kansas Medical Center ended up being the
     Internet provider.  We had to first go to the state and ask
     them to extend lines to Garden City because there was no
     point of presence in that area.  So we had to set up that.
                    We went to the hospital out there and talked with
     them about what -- what they had and how we could work with
     them.  And we bought a router and put it in the hospital in
     Garden City.  Garden City had bought a CODEX.  They had
     money to buy a CODEX because that was part -- we were going
     to use the Internet and we're going to need a CODEX, also.
                    They paid for the T1 line.  And I think we -- we
     maybe bought the multiplexer for them.  But they paid for
     the T1 line to the medical center.  They put in the 800
     number so that our students in that area could dial in
     through the hospital to the 800 number.  And they provided
     technical support.  Now, it was a win-win for everybody
     although we still had problems with it.
                    It was a win for us because we were able to take
     our courses there to students.  It's a win for the hospital
     because now they had a CODEX system (phonetic).  They could
     connect with the medical center.  They could connect with
     smaller hospitals around the medical center.  They are
     putting in computers now that our students will be able to
     go to the hospital and have access on those computers.  And
     they also will be able to connect to the medical center to
     our backbone and get Internet access through us. 
                    So it ended up being a community project, but not
     without its problems because there's a real learning curve
     there.  The people there did not -- the students as well as
     some of the staff at the hospital did not understand.  They
     don't even understand computers.  One student had never
     turned a computer on.  And we bought notebook computers and
     loaned them to all configured just like ours so it would be
     very simple.  
                    But we needed to supply the technical support
     there at the hospital, too.  So their hospital staff and
     network specialist, when something happens with the
     computers, and it does frequently -- we're again starting
     the third semester anyway -- the students have to bring them
     in there and get them -- get him to work on them more or
     they have to ship them back.
                    But I think that the technology is only going to
     get better.  And I think in the long run, this has brought
     something to that community that wasn't there before.  And I
     don't know if that's a kind of case scenario of what you're
     looking for.
                    MR. MAXWELL:  Again, sort of, as we aggregate the
     experience of people around here, other people can sort of
     comment on the record about the work that's being done on
     the federal level to try to get all of the federally funded
     projects to do an evaluation and that -- we start to build
     up something which is still in kind of an infinite stage as
     to where there's most important point of intervention.  And
     that's what we're trying to make sure, that we don't -- that
     we don't stumble in this and that we really can provide.
                    It may be baby steps at the first.  But if we get
     the -- if we get the sort of directionally correct and if we
     do it in a way that can evolve, then I think we've made an
     enormous contribution.  And you need to help us in that
     because we're -- we're -- you know, we could tell you what
     the bit rates are.  You could tell us whoever -- what the
     doctor/patient, doctor/doctor relationship needs to be like
     and how it's facilitated because that's stuff that we don't
     know.
                    MR. LAWLER:  Any other comments?
                    MR. SONNENSTRAHL:  Al Sonnenstrahl.  One more.  I
     don't know if this is the right group to define this, the
     word, "rural".  If so, who will be doing that?
                    MR. LAWLER:  Well, the -- I can answer what we've
     done so far.  And this at least seems logical to me.  But
     the -- the rural -- that was I think, Jim, your first --
     your first question of the rural subgroup, what is rural. 
     And I'm not the expert on that subject.  But you had three
     or four different options which you laid out.  And I think -
     - well, I won't say you expressed a preference, but you
     suggested there was one that was fairly well-developed.
                    MR. BRICK:  Right.  
                    MR. SONNENSTRAHL:  So that group would be the one
     who is developing the definition of rural?
                    MR. LAWLER:  I think it's fair to say that's
     probably a logical prediction.
                    MR. BRICK:  Yes, that's fair to say.
                    MR. TANGALOS:  Let's get that -- and my apologies
     for coming late, but I couldn't get out of Rochester last
     night.  I had other responsibilities.  Are you going to
     redefine rural or use one of the defined definitions that's
     already out there?
                    MR. BRICK:  I think we will probably use one
     that's already there and not reinvent a wheel.
                    MR. MAXWELL:  There are, as Jeanine said, a number
     of contributions in the record already to try to define what
     rural is.  And I think one of the useful contributions that
     have been made this morning is that we are thinking about
     this whole universal service issue as a kind of multi-
     layered activity with one part of it under the act being
     designed for rural, high cost, low income insular support
     which is one piece of the act.
                    This piece of the act that we're worried about
     collectively here is for rural health providers.  So there's
     going to be an overlap in this activity.  And we will try to
     make sure that we recognize how these two things interact
     and the differences and similarities that exist.
                    MR. SONNENSTRAHL:  I hope you are sure to include
     people with disabilities as part of the insular -- as part
     of rural -- part of the rural program.
                    MR. LAWLER:  The -- okay, well we are done.  We
     will have a -- the subgroup leaders will try to put that
     outline together and off we'll go.  And thank you for your
     work in advance.  See you in September.
                    (Whereupon, at 3:35 p.m on Thursday, July 11,
     1996, the hearing adjourned.)
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          //                        REPORTER'S CERTIFICATE
     
     
     FCC DOCKET NO.:       
     
     CASE TITLE:           TELECOMMUNICATIONS AND HEALTH CARE 
                           ADVISORY COMMITTEE MEETING
     
     HEARING DATE:  July 11, 1996
     
     LOCATION:             Washington, D. C.
     
                    I hereby certify that the proceedings and evidence
     are contained fully and accurately on the tapes and notes
     reported by me at the hearing in the above case before the
     Federal Communications Commission.
     
     
     Date:   07/11/96              _____________________________
                                   Official Reporter
                                   Heritage Reporting Corporation
                                   1220 "L" Street, N.W.
                                   Washington, D.C. 20005
                                   Bonnie Niemann
     
                           TRANSCRIBER'S CERTIFICATE
     
     
                    I hereby certify that the proceedings and evidence
     were fully and accurately transcribed from the tapes and
     notes provided by the above named reporter in the above case
     before the Federal Communications Commission.
     
     
     Date:   07/15/96              ______________________________
                                   Official Transcriber 
                                   Heritage Reporting Corporation
                                   Bonnie Niemann
     
                           PROOFREADER'S CERTIFICATE
     
                    I hereby certify that the transcript of the
     proceedings and evidence in the above referenced case that
     was held before the Federal Communications Commission was
     proofread on the date specified below.
     
     
     Date:   07/19/96              ______________________________
                                   Official Proofreader
                                   Heritage Reporting Corporation
                                   Barbara Blossom