|[July 18, 2018]
Alaska Communications and Rural Health Care Clinics Benefit from Increased Rural Health Care Program Funding and Approved 2017 Contracts
Uncertainty for Alaska's rural health care and telecommunications
providers has been reduced after the Federal Communications Commission
(FCC (News - Alert)) increased its Rural Health Care (RHC) program budget from $400
million to $571 million and approved funding of Alaska Communications'
(NASDAQ: ALSK) contracts for funding year (FY) 2017.
In a June 25 announcement, the FCC increased the annual cap on program
spending by nearly 43 percent, to $571 million, which reversed
across-the-board spending cuts for the current funding year imposed
under the old cap. The "pro-rata" cuts had created uncertainty and
turmoil in the program for patients, health care providers and
The program's previous $400 million cap was set in 1997 and never
indexed for inflation. The $171 million increase represents what the
funding level would be today had the initial cap included an inflation
Prospectively, the FCC will adjust the cap annually for inflation and
allow funds unused from prior years to be carried forward.
In addition, the FCC approved Alaska Communications' (News - Alert) rural health care
contracts for funding year 2017, which started July 1, 2017. The company
previously announced during its first quarter 2018 earnings call that it
had an accounts receivable balance for rural helth care customers, net
of amounts reserved, of $11.8 million at March 31, 2018. Alaska
Communications' approved funding year 2017 contracts have now been
transmitted to the Universal Service Administrative Company for
processing and payment.
"We are pleased that the FCC has approved our funding year 2017
contracts, increased the program budget and will adjust it annually for
inflation. The FCC's recent decisions create more certainty for both our
rural health care customers and our company. We appreciate the FCC
working with us and its commitment to the Rural Health Care program. We
look forward to working with the FCC on the longer term RHC program
changes," said Alaska Communications Senior Vice President Legal,
Regulatory and Government Affairs Leonard Steinberg.
Technology and telemedicine have assumed an increasingly important role
in health care delivery, particularly in rural and remote areas of
Alaska and the country. Broadband plays a critical role in the delivery
of telemedicine, giving patients in rural areas high-quality health care
services. The Rural Health Care program provides funding to eligible
health care providers for telecommunications and broadband services
necessary for the provision of health care.
About Alaska Communications
Alaska Communications (NASDAQ: ALSK) is the leading provider of advanced
broadband and managed IT services for businesses and consumers in
Alaska. The company operates a highly reliable, advanced statewide data
network with the latest technology and the most diverse undersea fiber
optic system connecting Alaska to the contiguous U.S. For more
information, visit www.alaskacommunications.com
View source version on businesswire.com: https://www.businesswire.com/news/home/20180718005210/en/
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