Cordova Community Medical Center is not closing its doors on July 1, but changes may be coming unless the Federal Communications Commission pays up.
At issue is a $965,370 bill for telecommunications services that comes due in full on June 30 to Alaska Communications, which has warned CCMC that unless payment is received they will disconnect the facility.
The bulk of the amount due should have been paid every month from the start of the current fiscal year through the FCC’s Rural Health Care program, but the FCC halted those payments after the end of the past fiscal year.
“CCMC is not closing next month,” Scot Mitchell, president and chief executive officer of the 23-bed critical access hospital, wrote on the facility’s Facebook page on May 16. His post was a quick response to an Anchorage news report that the hospital might be forced to close down.
“Currently, there is a news article going around on social media saying that CCMC may close its doors over FCC subsidy cuts,” Mitchell said.
“We would like to say that the story was very sensationalized and did not have most of the information discussed. We’re sorry that this news article did not explain the entire situation and resulted in a sensational story that caused a lot of stress unnecessarily.”
In an email response to a query from The Cordova Times, an FCC spokesman said May 21 that FCC chairman Ajit Pai “recognizes the importance of the FCC’s rural health care program and supports connecting Alaskans with broadband access.
“In this particular instance, to date, Alaska Communications has unfortunately not provided the FCC with sufficient information under the commission’s rule to justify the funding request that the company has submitted. Following a conversation with the FCC last week, it is our understanding that Alaska Communications is now working on providing the FCC with additional information in support of its request. In the meantime, the commission has made clear to the company that it may not lawfully request that CCMC pay the amount in question or cut off service to CCMC if it fails to pay that amount.”
Anchorage television station KTVA posted a news article on May 15 with the headline “Cordova hospital may close over FCC subsidy cuts.”
Mitchell, who was in Anchorage for a meeting of the Alaska State Hospital and Nursing Home Association, said that CCMC has actually been paying its approximate $1,000 share of the facility’s some $80,000 a month telecommunications bill, but that the Federal Communications Commission has not paid its approximate $79,000 a month share since last summer.
“The FCC says they are looking at the high cost of these services in Alaska compared to other parts of the country,” Mitchell told The Cordova Times.
Mitchell said he was told by the FCC that they would pay up if ACS justified the cost. CCMC has been working with ACS to help them get that money, and “from what I understand they have provided that information to the FCC,” he said.
CCMC is also working with the offices of Senators Lisa Murkowski and Dan Sullivan, both R-Alaska, to get ACS paid. According to Karina Petersen, a top Murkowski aide, Murkowski and the entire Alaska delegation has been trying for over a year “to assist in facilitating a productive conversation” between the Alaska telecommunications companies who participate in the Rural Health Care program and the FCC.
“The FCC is currently evaluating how the Rural Health Care program is managed, but until that is finalized Alaskan participants are in limbo, which is a real problem because rural health clinics provide critical tele-medicine services for remote Alaskan communities,” Petersen said. “Cutting off tele-medicine delivery would put Alaskans back decades.
“If rural health clinics don’t have the affordable broadband services they need to treat patients on-site, they’ll have to resort to medevacing patients out for treatment,” she said.
Officials with Alaska Communications meanwhile concurred with what Mitchell said, noting also that since the Rural Health Care program was established some 20 years ago, its budget has never been adjusted in consideration of substantial changes in technology.
Leonard Steinberg, vice president of legal, regulatory and government affairs for Alaska Communications, said their company really believes in the mission of rural health care.
“That is core to what we do, (but) in areas like Cordova we do not have any of our own facilities, so we have to acquire services buy it from third party providers such as Cordova Telephone,” Steinberg said. “IF you look at what those services cost us, the vast majority of what we bill is what it costs us to recover what they charge us for getting those services out to rural Alaska.”
Steinberg said that Alaska Communications has been constantly engaged with the FCC to try to get issues resolved.
“In December we reduced our workforce by about 5 percent and starting Jan. 1 every employee in this company has taken a significant wage reduction so we can continue to supply services,” he said.
The problem isn’t just in Cordova. Alaska Communications provides similar services to more than 40 locations across Alaska.
“We have not been paid for the services for any of those and we have had to take cash out of our pockets to keep these services going,” he said.
As the wait for payment continues, Mitchell said CCMC is working on contingency plans, in the event that ACS has to pull out.
Mitchell noted that the FCC also made recent cuts in the reimbursement rates they will provide because of the high use of those funds by rural medical facilities.
“If those cuts continue going forward that $1,000 that we are paying now will go up quite a bit,” he said.
