Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 6365

Flood Insurance Act of 1968, as 

amended, 42 U.S.C. 4022, prohibits 

flood insurance coverage unless an 

appropriate public body adopts 

adequate floodplain management 

measures with effective enforcement 

measures. The communities listed no 

longer comply with the statutory 

requirements, and after the effective 

date, flood insurance will no longer be 

available in the communities unless 

they take remedial action.

Regulatory Classification 

This final rule is not a significant 

regulatory action under the criteria of 

section 3(f) of Executive Order 12866 of 

September 30, 1993, Regulatory 

Planning and Review, 58 FR 51735. 

Paperwork Reduction Act 

This rule does not involve any 

collection of information for purposes of 

the Paperwork Reduction Act, 44 U.S.C. 

3501 et seq.

Executive Order 12612, Federalism 

This rule involves no policies that 

have federalism implications under 

Executive Order 12612, Federalism, 

October 26, 1987, 3 CFR, 1987 Comp.; 

p. 252. 

Executive Order 12778, Civil Justice 

Reform 

This rule meets the applicable 

standards of section 2(b)(2) of Executive 

Order 12778, October 25, 1991, 56 FR 

55195, 3 CFR, 1991 Comp.; p. 309.

List of Subjects in 44 CFR Part 64 

Flood insurance, Floodplains.

■ Accordingly, 44 CFR part 64 is 

amended as follows:

PART 64—[AMENDED]

■ 1. The authority citation for Part 64 

continues to read as follows:

Authority: 42 U.S.C. 4001 et seq.; 

Reorganization Plan No. 3 of 1978, 3 CFR, 

1978 Comp.; p. 329; E.O. 12127, 44 FR 19367, 

3 CFR, 1979 Comp.; p. 376.

§ 64.6 [Amended]

■ 2. The tables published under the 

authority of § 64.6 are amended as 

follows:

State and location Community

No. 

Effective date authorization/cancellation of 

sale of flood insurance in community 

Current effective

map date 

Date certain

Federal assistance no longer 

available in special flood hazard 

areas 

Region VII

Kansas: 

Manhattan, City of, Riley County and 

Pottawattamie County.

200300 January 3, 1974, Emerg; April 1, 1982, 

Reg; February 4, 2005, Susp.

Feb. 4, 2005 ..... Feb. 4, 2005. 

Odgen, City of, Riley County ........................ 200301 June 26, 1975, Emerg; October 15, 1981, 

Reg; February 4, 2005, Susp.

......do ............... Do. 

Riley County, Unincorporated Areas ............ 200298 June 23, 1975, Emerg; April 1, 1982, Reg; 

February 4, 2005, Susp.

......do ............... Do. 

Nebraska: Battle Creek, Madison County .... 310145 March 7, 1975, Emerg; September 30, 

1987, Reg; February 4, 2005, Susp.

......do ............... Do. 

Madison County, Unincorporated Areas ...... 310455 July 25, 1977, Emerg; January 1, 1987, 

Reg; February 4, 2005, Susp.

......do ............... Do. 

Code for reading third column: Emerg.—Emergency; Reg.—Regular; Susp.—Suspension. 

Dated: February 1, 2005. 

David I. Maurstad, 

Acting Mitigation Division Director, 

Emergency Preparedness and Response 

Directorate.

[FR Doc. 05–2257 Filed 2–4–05; 8:45 am] 

BILLING CODE 9110–12–P

FEDERAL COMMUNICATIONS 

COMMISSION 

47 CFR Part 54 

[WC Docket No. 02–60; FCC 04–289] 

Rural Health Care Support Mechanism

AGENCY: Federal Communications 

Commission.

ACTION: Final rule; petition for 

reconsideration. 

SUMMARY: In this document, we modify 

our rules to improve the effectiveness of 

the rural health care universal service 

support mechanism. Specifically, in this 

Report and Order, we change the 

Commission’s definition of rural for the 

purposes of the rural health care 

support mechanism because the 

definition currently used by the 

Commission is no longer being updated 

with new Census Bureau data. We also 

revise our rules to expand funding for 

mobile rural health care services by 

subsidizing the difference between the 

rate for satellite service and the rate for 

an urban wireline service with a similar 

bandwidth. On reconsideration, we 

permit rural health care providers in 

states that are entirely rural, such as 

American Samoa, to receive support for 

advanced telecommunications and 

information services under section 

254(h)(2)(A).

DATES: Effective April 8, 2005 except for 

§§ 54.609(e) and 54.621(c) which 

contain information collection 

requirements that have not been 

approved by the Office of Management 

Budget (OMB). The Commission will 

publish a document in the Federal 

Register announcing the effective date 

of those sections.

FOR FURTHER INFORMATION CONTACT:

Regina Brown at (202) 418–0792 or 

Dana Bradford at (202) 418–1932, 

Wireline Competition Bureau, 

Telecommunications Access Policy 

Division, TTY (202) 418–0484.

SUPPLEMENTARY INFORMATION: This is a 

summary of the Commission’s Report 

and Order, and Order on 

Reconsideration, in WC Docket No. 02–

60 released on December 17, 2004. The 

full text of this document is available for 

public inspection during regular 

business hours in the FCC Reference 

Center, Room CY–A257, 445 12th Street, 

SW., Washington, DC 20554. A 

companion Further Notice of Proposed 

Rulemaking in WC Docket No. 02–60 

was also released on December 17, 2004. 

I. Introduction 

1. In this Report and Order and Order 

on Reconsideration (Second Report and 

Order), we modify our rules to improve 

the effectiveness of the rural health care 

universal service support mechanism. 

The mechanism provides discounts to 

rural health care providers to access 

modern telecommunications for medical 

and health maintenance purposes. 

Specifically, in this Second Report and 

6366 Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 

Order, we change the Commission’s 

definition of rural for the purposes of 

the rural health care support mechanism 

because the definition currently used by 

the Commission is no longer being 

updated with new Census Bureau data. 

We also revise our rules to expand 

funding for mobile rural health care 

services by subsidizing the difference 

between the rate for satellite service and 

the rate for an urban wireline service 

with a similar bandwidth. Furthermore, 

we improve our administrative process 

by establishing a fixed deadline for 

applications for support. On 

reconsideration, we permit rural health 

care providers in states that are entirely 

rural to receive support for advanced 

telecommunications and information 

services under section 254(h)(2)(A). 

II. Report and Order 

A. Definition of ‘‘Rural Area’’

2. We conclude that the record 

supports the adoption of a new 

definition of ‘‘rural area’’ for the rural 

health care program. We received 

several proposals from commenters for 

a new definition of rural. Most of those 

definitions are currently used by other 

Federal agencies to determine eligibility 

for other Federal programs. As we 

explain in further detail below, we find 

that those proposals are either overinclusive or under-inclusive for our 

purpose. That is, based on an evaluation 

of the proposals contained in the record, 

such definitions would allow more 

areas to be considered rural than is 

appropriate for the rural health care 

program or would not include areas that 

are appropriately rural. The 

Commission should neither dilute the 

fund by using a methodology that is too 

broad, nor fail to achieve the goals of the 

1996 Act by using a methodology that 

is not broad enough. As such, the 

Commission has built on commenters’

proposals to develop a slightly more 

layered approach that more accurately 

defines the rural areas eligible for 

support under the rural health care 

mechanism. 

3. Whether an area is ‘‘rural’’ is 

determined by applying the following 

test. If an area is outside of any Core 

Based Statistical Area (CBSA), it is 

rural. Areas within CBSAs can be either 

rural or non-rural, depending on the 

characteristics of the CBSA. Small 

CBSAs—those that do not contain an 

urban area with populations of 25,000 

or more—are rural. Within large 

CBSAs—those that contain urban areas 

with populations of 25,000 or more—

census tracts can be either rural or nonrural depending on the characteristics of 

the particular census tract. If a census 

tract in a large CBSA does not contain 

any part of a place or urban area with 

a population greater than 25,000, then 

that tract is rural. Alternatively, if a 

census tract in a large CBSA contains all 

or part of a place or urban area with a 

population that exceeds 25,000, then it 

is not rural. 

4. To eliminate any confusion 

regarding implementation of this 

definition, the Commission will identify 

the areas that are rural and post the list 

on the Universal Service Administrative 

Company (USAC) Web site, as is done 

now. The list will include counties that 

are rural or partially rural. As now, for 

those counties that are partially rural, 

eligible census tracts will be listed. 

Applicants can determine their census 

tract using the link on the USAC web 

site or by calling USAC’s helpline for 

assistance. As such, the process for rural 

health care providers to determine their 

eligibility will be the same with the new 

definition as with the definition 

currently in use. The new definition 

will be effective as of Funding Year 

2005, which begins July 1, 2005. 

5. The new definition of rural area 

furthers the goals of section 254 for 

several reasons. Our new definition uses 

a methodology similar to our current 

definition. Just like our prior definition, 

all counties that are not located in a 

CBSA are defined as rural. For those 

counties located in a CBSA, as under 

the current definition, a further analysis 

is conducted for certain counties that 

have both urban and rural areas. The 

Goldsmith methodology, however, only 

called for such further analysis for 

counties comprising a larger geographic 

area, while our new definition expands 

the review to include counties of all 

sizes. As such, we believe our new 

definition improves upon the method 

that we previously used to determine 

which areas are rural by more accurately 

carving out the rural areas within 

counties that are located in a CBSA. For 

example, Dungannon, Virginia, which 

has a population of 317, is located in the 

northeastern corner of Scott County, 

Virginia. Though Scott County is part of 

the Kingsport-Bristol-Bristol, TN-VA 

Metropolitan Statistical Area, 

Dungannon is 28 miles—about an hour 

drive—from Kingsport, TN, the nearest 

large urban area. Under our previous 

definition, Dungannon was not rural 

because it was located in a small county 

that was part of an MSA. Under our new 

definition, however, we conduct a more 

granular review of Scott County at the 

census tract level. The census tract in 

which Dungannon is located does not 

contain any part of a place or urban area 

with greater than a 25,000 population. 

Therefore, Dungannon is rural, and any 

health care provider located in 

Dungannon is eligible for support. 

6. We selected 25,000 as the 

population threshold for the further 

analysis. While choosing the threshold 

is not an exact science, we believe urban 

areas above this size possess a critical 

mass of population and facilities. 

Although this standard may mean that 

some current eligible providers might 

no longer qualify, as noted below, we 

permit all health care providers that 

have received a funding commitment 

from USAC since 1998 to continue to 

qualify for funding for the next three 

years under the old definition. As we 

noted above, our new definition also 

allows rural health care providers to 

determine their eligibility in the same 

manner as under the old definition. 

Furthermore, because the definitions are 

similar, rural health care providers will 

not have to adjust to a new application 

process. An approach that simplifies the 

application process for rural health care 

providers will help ensure that 

applicants will not be deterred from 

applying for support due to 

administrative burdens.

7. To ease the transition to the new 

definition, we permit all health care 

providers that have received a funding 

commitment from USAC since 1998 to 

continue to qualify for support under 

the universal service mechanism for 

health care providers for funding for the 

next three years under the old 

definition. Thereafter, health care 

providers must qualify under our new 

definition to receive funding. We find 

that this transition period is necessary 

to allow rural health care providers to 

plan for the elimination of support. In 

addition, the transition period will 

allow the Commission time to review 

the effect of this definition. 

Support for Satellite Services for Mobile 

Rural Health Care Providers 

8. Pursuant to section 254(h)(1)(A) of 

the Act, telecommunications carriers 

must provide telecommunications 

services to rural health care providers at 

‘‘rates that are reasonably comparable to 

rates charged for similar services in 

urban areas in that State.’’ Under the 

Commission’s prior policies, the cost of 

rural satellite service was compared to 

the cost of urban satellite service. For 

satellite services, however, the price 

typically does not vary by location. 

Therefore rural health care providers 

did not receive discounts on such 

service under the rural health care 

program. In the 2003 Report and Order, 

68 FR 74492, December 24, 2003, we 

revised this policy to allow rural health 

care providers to receive discounts for 

satellite service even where wireline 

Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 6367

services are available, but we capped 

the discount at the amount providers 

would have received if they purchased 

functionally similar wireline 

alternatives. 

9. The situation of the mobile rural 

health care provider, however, is 

different. By definition, mobile rural 

health care providers do not stay in a 

fixed location. To receive 

telecommunications services, they 

would either have to install a wireline 

telecommunications service to every 

location they serve or use a satellite or 

other mobile service that can function in 

every location. In some cases, wireline 

services are not available because the 

locations are so remote. Even if a 

wireline service is technically available, 

the number of locations served results 

in what otherwise might be a more 

expensive satellite service becoming 

more cost-effective and more efficient. 

In those situations, as commenters note, 

for practical purposes no wireline 

service is available, so rural health care 

providers must use a satellite or other 

mobile telecommunications service. 

10. Cost benchmark for mobile rural 

health care provider. Accordingly, after 

reviewing the record in this proceeding, 

we revise our rules to allow mobile rural 

health care providers to receive 

discounts for satellite services 

calculated by comparing the rate for the 

satellite service to the rate for an urban 

wireline service with a similar 

bandwidth. We will not cap the 

discount for the satellite service at an 

amount of a functionally similar 

wireline alternative for mobile rural 

health care providers. We conclude that 

this revision furthers the principle of 

competitive neutrality and recognizes 

the role that telecommunications 

services play in rural areas without 

unduly increasing the size of the fund. 

Further, consistent with section 254, it 

helps to provide an affordable rate for 

the services necessary for telemedicine 

in rural America, strengthens 

telemedicine and telehealth networks 

across the nation, helps improve the 

quality of health care services available 

in rural America, and better enables 

rural communities to rapidly diagnose, 

treat, and contain possible outbreaks of 

disease. 

11. Criteria for mobile rural health 

care providers. Our current rules, 

combined with the requirement that 

health care providers remain 

responsible for a significant portion of 

service costs (i.e., the urban rate), are 

adequate to ensure that rural health care 

providers select the most cost-effective 

services and will ensure that rural 

health care providers make prudent 

economic decisions. We agree, however, 

with commenters that suggest that 

certain parameters or procedures should 

be established for determining what 

constitutes a ‘‘mobile’’ rural health care 

provider so that providers cannot obtain 

satellite services where such services 

are not the most cost-effective option. 

12. Because we believe some 

threshold must be established, however, 

mobile rural health care providers will 

be required to submit to USAC the 

number of sites the mobile rural health 

care provider will serve during the year. 

Where a mobile rural health care 

provider serves eight or more different 

sites in a year, we will presume that 

satellite services are most cost-effective. 

We conclude that where a mobile rural 

health care provider serves less than 

eight different sites per year, the mobile 

health care provider will be required to 

document and explain why satellite 

services are necessary to achieve the 

health care delivery goals of the mobile 

telemedicine project. In instances where 

a mobile rural health care provider 

serves less than eight different sites per 

year, USAC will determine on a case-bycase basis whether the 

telecommunications service selected by 

the mobile rural health care provider is 

the most cost-effective option for the 

telemedicine project in light of the 

limited number of sites served per year. 

13. Additionally, mobile rural health 

care providers seeking discounts for 

satellite services will be required to 

certify that they are serving eligible 

rural areas. Providers must keep annual 

logs indicating: (i) The date and 

locations of each clinic stop; and (ii) the 

number of patients served at each such 

clinic stop. Mobile rural health care 

providers must maintain their annual 

logs for a period of five years and make 

such logs available to the Administrator 

and the Commission upon request. 

14. In order to receive the discount, 

mobile rural health care providers will 

be required to provide to USAC 

documentation of the price for 

bandwidth equivalent wireline services 

in the urban area in the state to be 

covered by the project. Where a 

telemedicine project serves locations in 

different states, the provider must 

provide the price for bandwidth 

equivalent wireline services in the 

urban area, proportional to the locations 

served in each state. The method of cost 

allocation chosen by an applicant 

should be based on objective criteria, 

and reasonably reflect the eligible usage 

of the mobile health clinic. Where 

mobile rural health care provider is also 

serving patients in urban areas, prorated 

discounts will be provided 

commensurate only with the time the 

mobile rural health care provider is 

serving patients in rural areas. We also 

direct USAC to evaluate the allocation 

methods selected by program 

participants in the course of its audit 

activities to ensure program integrity 

and to ensure that providers are 

complying with the program’s 

certification requirements. Additionally, 

pursuant to section 54.619(a) of the 

commission’s rules, providers providing 

mobile health services must maintain 

records for their purchases of supported 

services for at least five years sufficient 

to document their compliance with all 

Commission requirements.

Deadline Established for Filing FCC 

Form 466 

15. In the 2002 NPRM, 67 FR 34653, 

May 15, 2002 and 2003 Report and 

Order, 68 FR 74492, December 24, 2003, 

we sought comment on ways to 

streamline the application process. We 

establish June 30 as the final deadline 

for filing FCC Forms 466 and 466–A for 

health care providers seeking discounts 

for a specific funding year under the 

rural health care universal service 

support mechanism. We conclude that 

providing an established deadline will 

provide specificity and finality to rural 

health care providers and will not 

require them to continue to check for 

Commission public notices. This 

deadline is also consistent with USAC’s 

Rural Health Care Division (RHCD)’s 

efforts to provide specific guidance to 

health care providers when submitting 

applications for universal service 

support. Applicants have more than a 

year to submit the necessary 

documentation for their application for 

support. In addition, a deadline of June 

30 for filing FCC Forms 466 and 466–

A coincides with the end of the funding 

year. Under section 54.623 of our rules, 

USAC can still set the dates for the 

filing window for purposes of the 

annual cap. 

III. Order on Reconsideration 

16. We grant, to the extent indicated 

herein, ASTCA’s Petition for 

Reconsideration of the 2003 Report and 

Order, 68 FR 74492, December 24, 2003. 

In light of the compelling and unique 

combination of circumstances facing 

‘‘entirely rural’’ states, we believe that it 

is appropriate to establish a support 

mechanism under section 254(h)(2)(A) 

that will provide funding for the 

provision of advanced 

telecommunications and information 

services. We therefore amend our rules 

to provide support to health care 

providers in states that are ‘‘entirely 

rural’’ equal to 50 percent of the 

monthly cost of advanced 

telecommunications and information 

6368 Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 

services reasonably related to the health 

care needs of the facility. 

17. We find that the Commission has 

authority to amend its rules for these 

specific circumstances under section 

254(h)(2)(A). Section 254(h)(2)(A) 

directs the Commission to establish 

competitively neutral rules to enhance 

access to advanced telecommunications 

and information services for health care 

providers. Section 254(h)(2)(A) gives the 

Commission broad authority to fulfill 

this statutory mandate. Unlike Congress’

directive to the Commission in section 

254(h)(1)(A), however, the 

Commission’s authority under section 

254(h)(2)(A) is discretionary, not 

mandatory. We find that there is a 

special need for the Commission to use 

its discretion to establish rules that will 

enhance access to advanced 

telecommunications and information 

services for health care providers in 

entirely rural states. 

18. This support is necessary to 

address the unique circumstances faced 

by health care providers and 

telecommunications carriers serving 

American Samoa and other similarly 

situated geographic areas. Geographic 

isolation and the lack of adequate local 

resources in ‘‘entirely rural’’ states can 

be mitigated by the availability and use 

of modern technology. Facilitating 

access to advanced telecommunications 

and information services would 

improve health care in geographically 

remote areas. 

19. Section 254(h)(2)(A) directs the 

Commission to enhance access to 

advanced telecommunications and 

information services to the extent 

technically feasible and economically 

reasonable. We find that providing 

universal service support to these 

specific health care providers is 

technically feasible and economically 

reasonable. There is no dispute that 

access to advanced telecommunications 

and information services is technically 

feasible in these areas. In fact, such 

services are currently being provided. 

We believe our actions to enhance 

access are also economically reasonable. 

We do not believe this discount will 

significantly increase distributions from 

the underutilized rural health care fund 

because the number of eligible entities 

is so small. The funding amount also is 

unlikely to significantly increase in the 

future because the current list of eligible 

entirely rural areas is not likely to 

change. 

20. Furthermore, we do not think that 

section 254(h)(1)(A) prohibits us from 

establishing this support. In the 2003 

Report and Order, 68 FR 74492, 

December 24, 2003 the Commission 

determined that section 254(h)(2)(A) 

was linked to section 254(h)(1)(A), such 

that funding for advanced 

telecommunications services must also 

be based on the urban-rural rate 

comparison for telecommunications 

services found in section 254(h)(1)(A). 

Upon further review, however, we 

conclude that the two statutory 

provisions are not inextricably linked. 

The methodology we use to calculate 

support under section 254(h)(2)(A), 

therefore, does not have to be based on 

the urban-rural comparison. 

21. Section 254(h)(2)(A), however, 

does not establish a methodology for 

calculating universal service support. 

The Commission provides a flat 

discount for Internet access for all 

eligible rural health care providers 

pursuant to section 254(h)(2)(A). We 

find that it is reasonable to use a similar 

methodology for support for entirely 

rural areas because we are relying on the 

same statutory provision. Therefore, we 

establish a 50 percent discount off the 

commercial rate for the purchase of 

advanced telecommunications and 

information services for states that are 

‘‘entirely rural.’’ We emphasize that the 

entire state must meet the definition of 

rural, as described above, to be eligible 

to receive the 50 percent discount. 

Consistent with the Commission’s 

principles of competitive neutrality, 

eligible health care providers may 

receive increased discounts for any 

advanced telecommunications and 

information service, regardless of the 

platform. 

IV. Procedural Matters 

A. Regulatory Flexibility Analysis 

22. As required by the Regulatory 

Flexibility Act of 1980, as amended 

(RFA), an Initial Regulatory Flexibility 

Analysis (IRFA) was incorporated in the 

2003 Further Notice of Proposed 

Rulemaking, 68 FR 74538, December 24, 

2003. The Commission sought public 

comments on the proposals in the 

Further Notice of Proposed Rulemaking,

including comment on the IRFA. This 

present Final Regulatory Flexibility 

Analysis (FRFA) conforms to the RFA.

B. Need for, and Objectives of, the 

Second Report and Order 

23. The Commission is required by 

section 254 of the Act to promulgate 

rules to implement the universal service 

provisions of section 254. On May 8, 

1997, the Commission adopted rules 

that reformed its system of universal 

service support mechanisms so that 

universal service is preserved and 

advanced as markets move toward 

competition. Among other programs, the 

Commission adopted a program to 

provide discounted telecommunications 

services to public or non-profit health 

care providers that serve persons in 

rural areas. Over the last few years, 

important changes in the rural health 

community, such as technological 

advances and the increasing variety of 

needs of the rural health care 

community, have prompted us to review 

the rural health care universal service 

support mechanism. In this Second 

Report and Order, we adopt several 

modifications to the Commission’s rules 

to improve the effectiveness of the rural 

health care universal service support 

mechanism and increase utilization of 

this mechanism by rural health care 

providers. 

24. Specifically, in this Second Report 

and Order, we change the Commission’s 

definition of rural for the purposes of 

the rural health care support mechanism 

because the definition currently used by 

the Commission is no longer being 

updated with new Census Bureau data 

by the Office of Rural Health Care 

Policy, the agency that developed the 

definition. Specifically, the new 

definition improves upon the previous 

method of determining which areas are 

rural by more accurately identifying the 

rural areas within counties. We also 

revise our rules to allow mobile rural 

health care providers to receive 

discounts for satellite services 

calculated by comparing the rate for the 

satellite service to the rate for an urban 

wireline service with a similar 

bandwidth. Mobile rural health care 

providers travel to remote areas of the 

country to deliver health care services to 

underserved populations for particular 

health conditions that may go unnoticed 

or untreated due to the lack of health 

care facilities in such areas. Thus, this 

approach will provide the support 

necessary to make mobile telemedicine 

economical for rural health care 

providers to provide health care to rural 

and remote areas, and to make 

telecommunications rates for public and 

non-profit rural health care providers 

comparable to those paid in urban areas. 

Furthermore, to provide specificity and 

finality to rural health care providers, 

we improve our administrative process 

by establishing a fixed deadline for 

applications for support. 

25. On reconsideration, we permit 

rural health care providers in states that 

are entirely rural, such as American 

Samoa, to receive support for advanced 

telecommunications and information 

services under section 254(h)(2)(A). 

Under the Commission’s current policy, 

health care providers in these areas do 

not receive universal service funding for 

the provision of telecommunications 

services because no urban-rural rate 

Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 6369

difference exists within the state or 

territory upon which to base the 

discount calculation. Telemedicine and 

other forms of treatment supported by 

advanced telecommunications services 

and information services eliminate the 

need for referrals to other locations by 

allowing local physicians to consult 

much more easily and frequently with 

physicians at fully equipped health care 

facilities. We expect this rule change 

will strengthen the ability of health care 

providers in states and territories that 

are entirely rural to provide critical 

health care services and improve health 

care for rural residents. 

26. We believe that such actions will 

improve significantly the ability of rural 

health care providers to respond to the 

medical needs of their communities, 

provide needed aid to strengthen 

telemedicine and telehealth networks 

across the nation, help improve the 

quality of health care services available 

in rural America, and better enable rural 

communities to rapidly diagnose, treat, 

and contain possible outbreaks of 

disease. In addition, these changes will 

equalize access to quality health care 

between rural and urban areas and will 

support telemedicine networks if 

needed for a national emergency. 

Enhancing access to an integrated 

nationwide telecommunications 

network for rural health care providers 

will further the Commission’s core 

responsibility to make available a rapid 

nationwide network for the purpose of 

the national defense, particularly with 

the increased awareness of the 

possibility of terrorist attacks. Finally, 

these changes will further the 

Commission’s efforts to improve its 

oversight of the operation of the 

program to ensure that the statutory 

goals of section 254 of the 

Telecommunications Act of 1996 are 

met without waste, fraud, or abuse. 

C. Summary of Significant Issues Raised 

by Public Comments in Response to the 

IRFA 

27. No petitions for reconsideration or 

comments were filed directly in 

response to the IRFA or on issues 

affecting small businesses. 

D. Description and Estimate of the 

Number of Small Entities to Which 

Rules Will Apply 

28. The RFA directs agencies to 

provide a description of, and where 

feasible, an estimate of the number of 

small entities that may be affected by 

the rules. The RFA generally defines the 

term ‘‘small entity’’ as having the same 

meaning as the terms ‘‘small business,’’

‘‘small organization,’’ and ‘‘small 

governmental jurisdiction.’’ In addition, 

the term ‘‘small business’’ has the same 

meaning as the term ‘‘small business 

concern’’ under the Small Business Act. 

A ‘‘small business concern’’ is one 

which: (1) Is independently owned and 

operated; (2) is not dominant in its field 

of operation; and (3) satisfies any 

additional criteria established by the 

Small Business Administration (SBA). 

a. Rural Health Care Providers 

29. Section 254(h)(5)(B) of the Act 

defines the term ‘‘health care provider’’

and sets forth seven categories of health 

care providers eligible to receive 

universal service support. Although the 

SBA has not developed a specific size 

category for small, rural health care 

providers, recent data indicate that there 

are a total of 8,297 health care 

providers, consisting of: (1) 625 ‘‘postsecondary educational institutions 

offering health care instruction, teaching 

hospitals, and medical schools;’’ (2) 866 

‘‘community health centers or health 

centers providing health care to 

migrants;’’ (3) 1633 ‘‘local health 

departments or agencies;’’ (4) 950 

‘‘community mental health centers;’’ (5) 

1951 ‘‘not-for-profit hospitals;’’ and (6) 

2,272 ‘‘rural health clinics.’’ We have no 

additional data specifying the numbers 

of these health care providers that are 

small entities nor do we know how 

many are located in areas we have 

defined as rural. In addition, non-profit 

entities that act as ‘‘health care 

providers’’ on a part-time basis are 

eligible to receive prorated support and 

we have no ability to quantify how 

many potential eligible applicants fall 

into this category. However, we have no 

data specifying the number of potential 

new applicants. Consequently, using the 

data we do have, we estimate that there 

are 8,297 or fewer small health care 

providers potentially affected by the 

actions proposed in this Notice. 

30. As noted earlier, non-profit 

businesses and small governmental 

units are considered ‘‘small entities’’

within the RFA. In addition, we note 

that census categories and associated 

generic SBA small business size 

categories provide the following 

descriptions of small entities. The broad 

category of Ambulatory Health Care 

Services consists of further categories 

and the following SBA small business 

size standards. The categories of small 

business providers with annual receipts 

of $6 million or less consists of: Offices 

of Dentists; Offices of Chiropractors; 

Offices of Optometrists; Offices of 

Mental Health Practitioners (except 

Physicians); Offices of Physical, 

Occupational and Speech Therapists 

and Audiologists; Offices of Podiatrists; 

Offices of All Other Miscellaneous 

Health Practitioners; and Ambulance 

Services. The category of small business 

Ambulatory Health Care Services 

providers with $8.5 million or less in 

annual receipts consists of: Offices of 

Physicians; Family Planning Centers; 

Outpatient Mental Health and 

Substance Abuse Centers; Health 

Maintenance Organization Medical 

Centers; Freestanding Ambulatory 

Surgical and Emergency Centers; All 

Other Outpatient Care Centers, Blood 

and Organ Banks; and All Other 

Miscellaneous Ambulatory Health Care 

Services. The category of Ambulatory 

Health Care Services providers with 

$11.5 million or less in annual receipts 

consists of: Medical Laboratories; 

Diagnostic Imaging Centers; and Home 

Health Care Services. The category of 

Ambulatory Health Care Services 

providers with $29 million or less in 

annual receipts consists of Kidney 

Dialysis Centers. For all of these 

Ambulatory Health Care Service 

Providers, census data indicate that 

there is a combined total of 345,476 

firms that operated in 1997. Of these, 

339,911 had receipts for that year of less 

than $5 million. In addition, an 

additional 3,414 firms had annual 

receipts of $5 million to $9.99 million; 

and additional 1,475 firms had receipts 

of $10 million to $24.99 million; and an 

additional 401 had receipts of $25 

million to $49.99 million. We therefore 

estimate that virtually all Ambulatory 

Health Care Services providers are 

small, given SBA’s size categories. We 

note, however, that our rules affect nonprofit and public healthcare providers, 

and many of the providers noted above 

would not be considered ‘‘public’’ or 

‘‘non-profit.’’ In addition, we have no 

data specifying the numbers of these 

health care providers that are rural and 

meet other criteria of the Act. 

31. The broad category of Hospitals 

consists of the following categories and 

the following small business providers 

with annual receipts of $29 million or 

less: General Medical and Surgical 

Hospitals, Psychiatric and Substance 

Abuse Hospitals; and Specialty (Except 

Psychiatric and Substance Abuse) 

Hospitals. For all of these health care 

providers, census data indicate that 

there is a combined total of 330 firms 

that operated in 1997, of which 237 or 

fewer had revenues of less than $25 

million. An additional 45 firms had 

annual receipts of $25 million to $49.99 

million. We therefore estimate that most 

Hospitals are small, given SBA’s size 

categories. In addition, we have no data 

specifying the numbers of these health 

care providers that are rural and meet 

other criteria of the Act. 

6370 Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 

32. The broad category of Social 

Assistance consists of the category of 

Emergency and Other Relief Services 

and small business size standard of 

annual receipts of $6 million or less. For 

all of these health care providers, census 

data indicates that there are a combined 

total of 37,778 firms that operated in 

1997. Of these, 37,649 or fewer firms 

had annual receipts of below $5 million. 

An additional 73 firms had annual 

receipts of $5 million to $9.99 million. 

We therefore estimate that virtually all 

Social Assistance providers are small, 

given SBA’s size categories. In addition, 

we have no data specifying the numbers 

of these health care providers that are 

rural and meet other criteria of the Act.

b. Providers of Telecommunications and 

Other Services 

33. We have included small 

incumbent local exchange carriers in 

this present RFA analysis. As noted 

above, a ‘‘small business’’ under the 

RFA is one that, inter alia, meets the 

pertinent small business size standard 

(e.g., a telephone communications 

business having 1,500 or fewer 

employees), and ‘‘is not dominant in its 

field of operation.’’ The SBA’s Office of 

Advocacy contends that, for RFA 

purposes, small incumbent local 

exchange carriers are not dominant in 

their field of operation because any such 

dominance is not ‘‘national’’ in scope. 

We have therefore included small 

incumbent local exchange carriers in 

this RFA analysis, although we 

emphasize that this RFA action has no 

effect on Commission analyses and 

determinations in other, non-RFA 

contexts. 

34. Total Number of Telephone 

Companies Affected. The Wireline 

Competition Bureau reports that, as of 

October 22, 2003, there were 4,748 firms 

engaged in providing telephone 

services, as defined therein. This 

number contains a variety of different 

categories of carriers, including local 

exchange carriers, interexchange 

carriers, competitive access providers, 

cellular carriers, mobile service carriers, 

operator service providers, pay 

telephone operators, PCS providers, 

covered SMR providers, and resellers. It 

seems certain that some of those 4,748 

telephone service firms may not qualify 

as small entities because they are not 

‘‘independently owned and operated.’’

For example, a PCS provider that is 

affiliated with an interexchange carrier 

having more than 1,500 employees 

would not meet the definition of a small 

business. It seems reasonable to 

conclude, therefore, that 4,748 or fewer 

telephone service firms are small entity 

telephone service firms that may be 

affected by the decisions and rules 

adopted in this Report and Order. 

35. Local Exchange Carriers, 

Interexchange Carriers, Competitive 

Access Providers, Operator Service 

Providers, Payphone Providers, and 

Resellers. Neither the Commission nor 

SBA has developed a definition 

particular to small local exchange 

carriers (LECs), interexchange carriers 

(IXCs), competitive access providers 

(CAPs), operator service providers 

(OSPs), payphone providers or resellers. 

The closest applicable definition for 

these carrier-types under SBA rules is 

for Wired Telecommunications Carriers 

having less than 1,500 employees. The 

most reliable source of information 

regarding the number of these carriers 

nationwide of which we are aware 

appears to be the data that we collect 

annually on the Form 499–A. According 

to our most recent data, there are 1,335 

incumbent LECs, 349 CAPs, 204 IXCs, 

21 OSPs, 758 payphone providers and 

454 resellers. Although it seems certain 

that some of these carriers are not 

independently owned and operated, or 

have more than 1,500 employees, we are 

unable at this time to estimate with 

greater precision the number of these 

carriers that would qualify as small 

business concerns under SBA’s 

definition. Consequently, we estimate 

that there are fewer than 1,335 

incumbent LECs, 349 CAPs, 204 IXCs, 

21 OSPs, 758 payphone providers, and 

541 resellers that may be affected by the 

decisions and rules adopted in this 

Report and Order. 

36. Internet Service Providers. The 

SBA has developed a small business 

size standard for ‘‘On-Line Information 

Services,’’ NAICS code 518111. This 

category comprises establishments 

‘‘primarily engaged in providing direct 

access through telecommunications 

networks to computer-held information 

compiled or published by others.’’

Under this small business size standard, 

a small business is one having annual 

receipts of $21 million or less. Based on 

firm size data provided by the Bureau of 

the Census, 3,123 firms are small under 

SBA’s $21 million size standard for this 

category code. Although some of these 

Internet Service Providers (ISPs) might 

not be independently owned and 

operated, we are unable at this time to 

estimate with greater precision the 

number of ISPs that would qualify as 

small business concerns under SBA’s 

small business size standard. 

Consequently, we estimate that there are 

3,123 or fewer small entity ISPs that 

may be affected. 

37. Satellite Service Carriers. The SBA 

has developed a definition for small 

businesses within the category of 

Satellite Telecommunications. 

According to SBA regulations, a small 

business under the category of Satellite 

communications is one having annual 

receipts of $12.5 million or less. 

According to SBA’s most recent data, 

there are a total of 371 firms with 

annual receipts of $9,999,999 or less, 

and an additional 69 firms with annual 

receipts of $10,000,000 or more. Thus, 

the number of Satellite 

Telecommunications firms that are 

small under the SBA’s $12 million size 

standard is between 371 and 440. 

Further, some of these Satellite Service 

Carriers might not be independently 

owned and operated. Consequently, we 

estimate that there are fewer than 440 

small entity ISPs that may be affected by 

the decisions and rules of the present 

action. 

38. Wireless Service Providers. The 

SBA has developed a definition for 

small businesses within the two 

separate categories of Cellular and Other 

Wireless Telecommunications. Under 

that SBA definition, such a business is 

small if it has 1,500 or fewer employees. 

According to the Commission’s most 

recent Telephone Trends Report data, 

1,495 companies reported that they 

were engaged in the provision of 

wireless service. Of these 1,495 

companies, 989 reported that they have 

1,500 or fewer employees and 506 

reported that, alone or in combination 

with affiliates, they have more than 

1,500 employees. We do not have data 

specifying the number of these carriers 

that are not independently owned and 

operated, and thus are unable at this 

time to estimate with greater precision 

the number of wireless service providers 

that would qualify as small business 

concerns under the SBA’s definition. 

Consequently, we estimate that there are 

989 or fewer small wireless service 

providers that may be affected by the 

rules. 

39. Vendors of Infrastructure 

Development or ‘‘Network Buildout.’’

The Commission has not developed a 

small business size standard specifically 

directed toward manufacturers of 

network facilities. The closest 

applicable definition of a small entity 

are the size standards under the SBA 

rules applicable to manufacturers of 

‘‘Radio and Television Broadcasting and 

Communications Equipment’’ (RTB) and 

‘‘Other Communications Equipment.’’

According to the SBA’s regulations, 

manufacturers of RTB or other 

communications equipment must have 

750 or fewer employees in order to 

qualify as a small business. The most 

recent available Census Bureau data 

indicates that there are 1,187 

establishments with fewer than 1,000 

Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 6371

employees in the United States that 

manufacture radio and television 

broadcasting and communications 

equipment, and 271 companies with 

less than 1,000 employees that 

manufacture other communications 

equipment. Some of these 

manufacturers might not be 

independently owned and operated. 

Consequently, we estimate that the 

majority of the 1,458 internal 

connections manufacturers are small.

40. Cable and Other Program 

Distribution. The SBA has developed a 

small business size standard which 

includes all such companies generating 

$12.5 million or less in revenue 

annually. This standard covers Cable 

and Other Program Distribution. Only 

businesses in Cable and Other Program 

Distribution category can be affected by 

the rules and policies adopted herein. 

This category includes cable systems 

operators, closed circuit television 

services, direct broadcast satellite 

services, multipoint distribution 

systems, satellite master antenna 

systems, and subscription television 

services. According to Census Bureau 

data for 1997, there were a total of 1,311 

firms in this category, total, that had 

operated for the entire year. Of this 

total, 1,180 firms had annual receipts of 

under $10 million and an additional 52 

firms had receipts of $10 million or 

more but less than $25 million. 

Consequently, the Commission 

estimates that the majority of providers 

in this service category are small 

businesses that may be affected by the 

rules and policies adopted herein. 

E. Description of Projected Reporting, 

Recordkeeping, and Other Compliance 

Requirements 

41. This Second Report and Order

adopts several modifications to the 

Commission’s rules to improve the 

effectiveness of the rural health care 

universal service support mechanism 

and increase utilization of this 

mechanism by rural health care 

providers. First, as articulated above, in 

this Second Report and Order, we 

change the Commission’s definition of 

rural for the purposes of the rural health 

care support mechanism. The new 

definition will not impact reporting or 

recordkeeping requirements. It does, 

however, change the overall pool of 

eligible applicants. Second, this Second 

Report and Order expands funding for 

mobile rural health care services by 

subsidizing the difference between the 

actual rate of satellite service for mobile 

rural health care providers and the rate 

for an urban wireline service with a 

similar bandwidth. Because mobile 

rural health care providers will now be 

eligible for support, we adopt rules 

requiring such providers to submit an 

estimated number of sites the mobile 

health care provider will serve during 

the year. Additionally, mobile rural 

health care providers seeking discounts 

for satellite services will be required to 

certify that they are serving eligible 

rural areas. Providers must keep annual 

logs indicating: (i) The date and 

locations of each clinic stop; and (ii) the 

number of patients served at each such 

clinic stop. Mobile rural health care 

providers must maintain their annual 

logs for a period of five years and make 

such logs available to the Administrator 

and the Commission upon request. 

Further, in order to receive the discount, 

mobile rural health care providers will 

be required to provide to USAC 

documentation of the price for 

bandwidth equivalent wireline services 

in the urban area in the state to be 

covered by the project. 

42. These reporting and 

recordkeeping requirements will 

minimally impact both small and large 

entities. However, even though the 

minimal impact may be more 

financially burdensome for smaller 

entities, the minimal impact of such 

requirements is outweighed by the 

benefit of providing support necessary 

to make mobile telemedicine 

economical for rural health care 

providers to provide health care to rural 

and remote areas, and to make 

telecommunications rates for public and 

non-profit rural health care providers 

comparable to those paid in urban areas. 

Further, these requirements are 

necessary to ensure that the statutory 

goals of section 254 of the 

Telecommunications Act of 1996 are 

met without waste, fraud, or abuse. 

F. Steps Taken To Minimize Significant 

Economic Impact on Small Entities, and 

Significant Alternatives Considered 

43. The RFA requires an agency to 

describe any significant alternatives that 

it has considered in reaching its 

proposed approach impacting small 

business, which may include the 

following four alternatives (among 

others): (1) The establishment of 

differing compliance and reporting 

requirements or timetables that take into 

account the resources available to small 

entities; (2) the clarification, 

consolidation, or simplification of 

compliance or reporting requirements 

under the rule for small entities; (3) the 

use of performance, rather than design, 

standards; and (4) an exemption from 

coverage of the rule, or part thereof, for 

small entities. 

44. In this Second Report and Order,

we amend our rules to improve the 

program, increase participation by rural 

health care providers, and ensure that 

the benefits of the program continue to 

be distributed in a fair and equitable 

manner. The actions taken in this 

Second Report and Order help improve 

health care services available in rural 

America, and better enable rural 

communities to rapidly diagnose, treat, 

and contain possible outbreaks of 

disease. Thus, rural health care 

providers stand to benefit directly from 

the modifications to our rules and 

policies. 

45. We have taken the following steps 

to minimize the impact on small 

entities. First, to ease the transition to 

the new definition, we permit all health 

care providers that have received a 

funding commitment from USAC since 

1998 to continue to qualify for funding 

for the next three years under the old 

definition. Thereafter, health care 

providers must qualify under our new 

definition to receive funding. We find 

that this transition period is necessary 

to allow rural health care providers to 

plan for the elimination of support. The 

alternative of not providing for a 

transition period was considered but 

rejected because we believe a transition 

period is necessary to allow rural health 

care providers to plan for the 

elimination of support, thus minimizing 

any adverse or unfair impact on smaller 

entities. In addition, this transition 

period will allow us time to review the 

effect of this definition on smaller 

entities. Second, our new definition 

allows rural health care providers to 

determine their eligibility in the same 

manner as under the old definition. 

Because the old and new definitions are 

similar, rural health care providers will 

not have to adjust to a new application 

process. The alternative of not allowing 

rural health care providers to determine 

their eligibility in the same manner was 

also considered but rejected because we 

wanted to minimize confusion on the 

part of applicants. An approach that 

simplifies the application process for 

rural health care providers will help 

ensure that applicants, including small 

entities, will not be deterred from 

applying for support due to 

administrative burdens. Lastly, for 

mobile rural health care services, we 

have established a presumption that 

will minimize administrative burdens 

for all applicants, including smaller 

entities. Mobile rural health care 

providers will be required to submit to 

USAC an estimated number of sites the 

mobile rural health care provider will 

serve during the year. Where a mobile 

rural health care provider serves eight or 

more sites in a year, we will presume 

6372 Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 

that satellite services are most costeffective and we will not require a 

further showing from such providers. 

G. Report to Congress 

46. The Commission will send a copy 

of this Report and Order and Order on 

Reconsideration including this FRFA, in 

a report to be sent to Congress pursuant 

to the Congressional Review Act. In 

addition, the Commission will send a 

copy of the Report and Order and Order 

on Reconsideration including this 

FRFA, to the Chief Counsel for 

Advocacy of the Small Business 

Administration. A copy of this Report 

and Order and Order on 

Reconsideration and FRFA (or 

summaries thereof) will also be 

published in the Federal Register. 

H. Paperwork Reduction Act Analysis 

47. This document contains modified 

information collection requirements 

subject to the Paperwork Reduction Act 

of 1995 (PRA), Public Law 104–13. It 

will be submitted to the Office of 

Management and Budget (OMB) for 

review under section 3507(d) of the 

PRA. OMB, the general public, and 

other Federal agencies are invited to 

comment on the modified information 

collection requirements contained in 

this proceeding. In addition, we note 

that pursuant to the Small Business 

Paperwork Relief Act of 2002, Public 

Law 107–198, see 44 U.S.C. 3506(c)(4), 

we previously sought specific comment 

on how the Commission might ‘‘further 

reduce the information collection 

burden for small business concerns with 

fewer than 25 employees.’’

48. In this present document, we have 

assessed the effects of the measures 

adopted to protect against waste, fraud 

and abuse in the administration of the 

rural health care universal service 

support mechanism. We find that the 

modified information and record 

retention requirements for mobile rural 

health care providers and the modified 

certification requirements for health 

care providers in states that are entirely 

rural will not be unduly burdensome on 

small businesses. 

49. The full text of this document is 

available for public inspection and 

copying during regular business hours 

at the FCC Reference Information 

Center, Portals II, 445 12th Street, SW., 

Room CY–A257, Washington, DC 20554. 

This document may also be purchased 

from the Commission’s duplicating 

contractor, Best Copy and Printing, 

Portals II, 445 12th Street, SW., Room 

CY–B402, Washington, DC 20554, 

telephone (202) 488–5300, facsimile 

(202) 488–5563, or via e-mail 

qualexint@aol.com.

I. Further Information 

50. Alternative formats (computer 

diskette, large print, audio recording, 

and Braille) are available to persons 

with disabilities by contacting Brian 

Millin at (202) 418–7426 voice, (202) 

418–7365 TTY, or bmillin@fcc.gov. This 

Order can also be downloaded in 

Microsoft Word and ASCII formats at 

http://www.fcc.gov/ccb/

universalservice/highcost.

51. For further information, contact 

Regina Brown at (202) 418–0792 or 

Dana Bradford at (202) 418–1932, in the 

Telecommunications Access Policy 

Division, Wireline Competition Bureau. 

V. Ordering Clauses 

52. Pursuant to the authority 

contained in sections 1, 4(i), 4(j), 201–

205, 214, 254, and 403 of the 

Communications Act of 1934, as 

amended, 47 U.S.C. 151, 154(i), 154(j), 

201–205, 214, 254, and 403, this Report 

and Order and Order on 

Reconsideration, is adopted. 

53. Pursuant to the authority 

contained in section 405, of the 

Communications Act of 1934, as 

amended, 47 U.S.C. 405, and §§ 0.291 

and 1.429 of the Commission’s rules, 47 

CFR 0.291 and 1.429, American Samoa 

Telecommunications Authority’s 

Petition for Reconsideration is granted 

to the extent indicated herein. 

54. It is further ordered that part 54 

of the Commission’s rules, 47 CFR part 

54, except §§ 54.609 and 54.619 which 

will become effective upon Office of 

Management and Budget approval, is 

amended as set forth in Appendix A 

attached hereto, effective thirty (30) 

days after the publication of this Report 

and Order and Order on 

Reconsideration in the Federal Register. 

55. It is further ordered that the 

Commission’s Consumer and 

Governmental Affairs Bureau, Reference 

Information Center, shall send a copy of 

this Report and Order and Order on 

Reconsideration including the Final 

Regulatory Flexibility Analysis to the 

Chief Counsel for Advocacy of the Small 

Business Administration.

List of Subjects in 47 CFR Part 54 

Health Facilities, Libraries, Reporting 

and recordkeeping requirements, 

Schools, Telecommunications, 

Telephone.

Federal Communications Commission. 

Marlene H. Dortch, 

Secretary.

Final Rules

■ For the reasons discussed in the 

preamble, the Federal Communications 

Commission amends 47 CFR part 54 as 

follows:

PART 54—UNIVERSAL SERVICE

■ 1. The authority citation for part 54 

continues to read as follows:

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

and 254 unless otherwise noted.

■ 2. Amend § 54.5 by revising the 

definition of ‘‘Rural area’’ to read as 

follows:

§ 54.5 Terms and definitions.

* * * * *

Rural area. For purposes of the 

schools and libraries universal support 

mechanism, a ‘‘rural area’’ is a 

nonmetropolitan county or county 

equivalent, as defined in the Office of 

Management and Budget’s (OMB) 

Revised Standards for Defining 

Metropolitan Areas in the 1990s and 

identifiable from the most recent 

Metropolitan Statistical Area (MSA) list 

released by OMB, or any contiguous 

non-urban Census Tract or Block 

Numbered Area within an MSA-listed 

metropolitan county identified in the 

most recent Goldsmith Modification 

published by the Office of Rural Health 

Policy of the U.S. Department of Health 

and Human Services. For purposes of 

the rural health care universal service 

support mechanism, a ‘‘rural area’’ is an 

area that is entirely outside of a Core 

Based Statistical Area; is within a Core 

Based Statistical Area that does not have 

any Urban Area with a population of 

25,000 or greater; or is in a Core Based 

Statistical Area that contains an Urban 

Area with a population of 25,000 or 

greater, but is within a specific census 

tract that itself does not contain any part 

of a Place or Urban Area with a 

population of greater than 25,000. ‘‘Core 

Based Statistical Area’’ and ‘‘Urban 

Area’’ are as defined by the Census 

Bureau and ‘‘Place’’ is as identified by 

the Census Bureau.

* * * * *

■ 3. Amend § 54.601 by adding 

paragraphs (a)(3)(i), (a)(3)(ii), and (c)(3) 

to read as follows:

§ 54.601 Eligibility. 

(a) * * * 

(3) * * * 

(i) Any health care provider that was 

located in a rural area under the 

definition used by the Commission prior 

to July 1, 2005, and that had received a 

funding commitment from USAC since 

1998, shall continue to qualify for 

support under the universal service 

mechanism for health care providers for 

a period of three years, beginning July 

1, 2005. 

Federal Register / Vol. 70, No. 24 / Monday, February 7, 2005 / Rules and Regulations 6373

(ii) [Reserved]

* * * * *

(c) * * * 

(3) Advanced telecommunications 

and information services as provided 

under § 54.621.

* * * * *

■ 4. Amend § 54.609 by adding 

paragraph (e) to read as follows:

§ 54.609 Calculating support.

* * * * *

(e) Mobile rural health care providers.

(1) Calculation of support. Mobile rural 

health care providers may receive 

discounts for satellite services 

calculated by comparing the rate for the 

satellite service to the rate for an urban 

wireline service with a similar 

bandwidth. Discounts for satellite 

services shall not be capped at an 

amount of a functionally similar 

wireline alternative. Where the mobile 

rural health care provider provides 

service in more than one state, the 

calculation shall be based on the urban 

areas in each state, proportional to the 

number of locations served in each 

state. 

(2) Documentation of support. (i) 

Mobile rural health care providers shall 

provide to the Administrator 

documentation of the price of 

bandwidth equivalent wireline services 

in the urban area in the state or states 

where the service is provided. Mobile 

rural health care providers shall provide 

to the Administrator the number of sites 

the mobile health care provider will 

serve during the funding year. 

(ii) Where a mobile rural health care 

provider serves less than eight different 

sites per year, the mobile rural health 

care provider shall provide to the 

Administrator documentation of the 

price of bandwidth equivalent wireline 

services. In such case, the Administrator 

shall determine on a case-by-case basis 

whether the telecommunications service 

selected by the mobile rural health care 

provider is the most cost-effective 

option. Where a mobile rural health care 

provider seeks a more expensive 

satellite-based service when a less 

expensive wireline alternative is most 

cost-effective, the mobile rural health 

care provider shall be responsible for 

the additional cost.

■ 5. Amend § 54.615 by revising 

paragraph (c)(2) to read as follows:

§ 54.615 Obtaining services.

* * * * *

(c) * * * 

(2) The requester is physically located 

in a rural area, unless the health care 

provider is requesting services provided 

under § 54.621; or, if the requester is a 

mobile rural health care provider 

requesting services under § 54.609(e), 

that the requester has certified that it is 

serving eligible rural areas.

* * * * *

■ 6. Amend § 54.619 by revising 

paragraph (a) to read as follows:

§ 54.619 Audits and recordkeeping. 

(a) Health care providers. (1) Health 

care providers shall maintain for their 

purchases of services supported under 

this subpart documentation for five 

years from the end of the funding year 

sufficient to establish compliance with 

all rules in this subpart. Documentation 

must include, among other things, 

records of allocations for consortia and 

entities that engage in eligible and 

ineligible activities, if applicable. 

Mobile rural health care providers shall 

maintain annual logs indicating: The 

date and locations of each clinic stop; 

and the number of patients served at 

each such clinic stop. 

(2) Mobile rural health care providers 

shall maintain its annual logs for a 

period of five years. Mobile rural health 

care providers shall make its logs 

available to the Administrator and the 

Commission upon request.

* * * * *

■ 7. Amend § 54.621 by adding 

paragraph (c) to read as follows:

§ 54.621 Access to advanced 

telecommunications and information 

services.

* * * * *

(c) Health care providers located in 

States that are entirely rural shall be 

eligible to receive universal service 

support equal to 50 percent of the 

monthly cost of advanced 

telecommunications and information 

services reasonably related to the health 

care needs of the facility.

■ 8. Amend § 54.623 by revising 

paragraphs (a), (b), (c)(2), and (c)(3) to 

read as follows:

§ 54.623 Cap. 

(a) Amount of the annual cap. The 

annual cap on federal universal service 

support for health care providers shall 

be $400 million per funding year, with 

the following exceptions. 

(b) Funding year. A funding year for 

purposes of the health care providers 

cap shall be the period July 1 through 

June 30. 

(c) * * * 

(2) For each funding year, which will 

begin on July 1, the Administrator shall 

implement a filing period that treats all 

health care providers filing within that 

period as if they were simultaneously 

received. The filing period shall begin 

on the date that the Administrator 

begins to receive applications for 

support, and shall conclude on a date to 

be determined by the Administrator. 

(3) The Administrator may implement 

such additional filing periods as it 

deems necessary. The deadline for all 

required forms to be filed with the 

Administrator is June 30 for the funding 

year that begins on the previous July 1.

* * * * *

[FR Doc. 05–2269 Filed 2–4–05; 8:45 am] 

BILLING CODE 6712–01–U

DEPARTMENT OF DEFENSE

48 CFR Part 219 

[DFARS Case 2003–D063] 

Defense Federal Acquisition 

Regulation Supplement; Small 

Business Competitiveness 

Demonstration Program

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

SUMMARY: DoD has issued a final rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to revise text regarding 

identification of contract awards under 

the Small Business Competitiveness 

Demonstration Program. This rule is a 

result of an initiative undertaken by 

DoD to dramatically change the purpose 

and content of the DFARS.

EFFECTIVE DATE: February 7, 2005.

FOR FURTHER INFORMATION CONTACT: Ms. 

Michele Peterson, Defense Acquisition 

Regulations Council, 

OUSD(AT&L)DPAP (DAR), IMD 3C132, 

3062 Defense Pentagon, Washington, DC 

20301–3062. Telephone (703) 602–0311; 

facsimile (703) 602–0350. Please cite 

DFARS Case 2003–D063.

SUPPLEMENTARY INFORMATION: 

A. Background 

DFARS Transformation is a major 

DoD initiative to dramatically change 

the purpose and content of the DFARS. 

The objective is to improve the 

efficiency and effectiveness of the 

acquisition process, while allowing the 

acquisition workforce the flexibility to 

innovate. The transformed DFARS will 

contain only requirements of law, DoDwide policies, delegations of FAR 

authorities, deviations from FAR 

requirements, and policies/procedures 

that have a significant effect beyond the 

internal operating procedures of DoD or 

a significant cost or administrative 

impact on contractors or offerors. 

Additional information on the DFARS 

Transformation initiative is available at