Issue link: https://beckershealthcare.uberflip.com/i/1007936
20 CFO / FINANCE Alaska hospital faces closure over $964k telecommunications bill By Ayla Ellison C ordova (Alaska) Community Medical Center, a 23-bed critical access hospi- tal, may close due to cuts to a federal program that subsidizes the hospital's tele- communications costs, according to KTVA. e federal Rural Health Care Program pro- vides up to $400 million annually to medical providers in rural areas for telecommuni- cations and broadband services necessary for the provision of healthcare. In March, Universal Service Administrative Compa- ny, the program's independent administra- tor, announced it will reduce RHC Program funding for fiscal year 2017 by 15 percent for individual participants and 25 percent for consortia participants. "Unfortunately, these deep reductions were announced eight months into the funding year, and were far greater than anticipated," the American Hospital Association wrote in an April 24 letter to Federal Communications Commission Secretary Marlene Dortch. "ese cuts not only affect the ability of these rural healthcare providers to maintain strong broadband connections but also could force tough decisions affecting funding for essen- tial healthcare services." e AHA said the cuts are "especially dis- heartening" to rural hospitals with slim op- erating margins that have already set their budgets for 2018. Cordova Community Med- ical Center is one of those hospitals, and it received a letter May 2 from its data services provider seeking $964,370 in back costs. "We are now 10 months into the current funding year and your funding request is still being put through an 'enhanced review' by USAC," states the letter from Alaska Com- munications to Cordova Community Med- ical Center. Alaska Communications said it has used its own cash to pay third parties to maintain the hospital's data service, but it is unable to keep providing those funds. Alaska Communications requested the hos- pital pay the full amount due by June 30 or face disconnection of services on July 1. e hospital's monthly telecommunications bill is $80,000, but it only pays $1,000 out of pocket aer federal funding kicks in. Cor- dova Community Medical Center CEO Scot Mitchell told KTVA the facility keeps about $400,000 cash on hand and is unable to pay the full bill from Alaska Communications. Alaska State Hospital and Nursing Home Association President Becky Hultberg told KTVA Cordova Community Medical Center "essentially cannot function" without inter- net-based reporting and record-keeping sys- tems and may be forced to close. n