Rural Health Care Connectivity Legislation Could Save $18M Over a Decade, CBO Report Says

March 25, 2016
A bill, S. 1916, that would enable rural nursing facilities to tap into funding from the government’s Universal Service Fund for telecommunications and broadband services could save $18 million over a nine-year period, according to a Congressional Budget Office Cost Estimate report.

A bill, S. 1916, that would enable rural nursing facilities to tap into funding from the government’s Universal Service Fund for telecommunications and broadband services could save $18 million over a nine-year period, according to a Congressional Budget Office Cost Estimate report.

U.S. Senator John Thune (R-S.D.), chairman of the Senate Committee on Commerce, Science and Transportation, introduced the Rural Health Care Connectivity Act of 2015 last year to amend the Communications Act of 1934 to permit skilled nursing facilities (SNF) to be eligible to apply for support from the Universal Service Fund’s (USF) Rural Health Care Program (RHCP). The USF’s RHCP provides funding for telecommunications and broadband services used to promote health care in rural communities. If passed, the bill could help provide better care in rural areas by enabling health IT tools like telemedicine.

As previously reported in Healthcare Informatics, S. 1916 passed the Senate Committee on Commerce last November. At that time, the committee ordered the CBO to provide a cost estimate.

And the report stated that “CBO estimates that an average of 1,650 public and nonprofit SNFs in rural areas would be eligible for grants during that period and that participation rates and grant awards would be similar to those for existing RHC programs. Based on information from the FCC, CBO estimates that participation rates would reach 75 percent over a period of several years and that certain non-rural entities affiliated with those participants also would receive funding.”

“CBO estimates that enacting S. 1916 would increase direct spending by $197 million over the 2017-2026 period and result in increased revenue collections of $215 million over the same period, resulting in an estimated net reduction in the deficit of $18 million, the report stated.

In a statement about the bill, Sen. Thune said the bill would “support and improve the health care services that skilled nursing facilities can provide to our rural communities by allowing them access to much-needed funds that are currently out of reach.”

The Evangelical Lutheran Good Samaritan Society (Good Sam), headquartered in Sioux Falls, S.D., currently operates hundreds of SNFs nationwide, most of which are in rural communities.

“Through Internet-based connections to its national headquarters, Good Sam allows rural patients to remotely connect with hospitals and physicians. The Rural Health Care Connectivity Act of 2015 would help organizations like Good Sam provide better quality care for rural areas throughout the country,” Thune stated.

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