[ Text Version ]

Remarks of
Chairman Reed Hundt (as prepared for delivery)

Promoting Standards in Telehealth Forum
July 17, 1997

Welcome to the joint FCC/HOST forum on Promoting Standards in Telehealth. Compared to most, this audience is very well-versed in the potential benefits of telehealth. The use of telecommunications services to transport health care information and services to wherever they are needed can save time, money, and lives. Participants in this forum share an interest and commitment to realizing the potential of telehealth as quickly and affordably as possible. Promoting standards and interoperability of telehealth equipment is an important part of that process.

The lack of interoperability of much telehealth equipment is of particular concern to the FCC because it relates to our universal service policy. What good will up to $400 million dollars worth of support for telecommunications services do for health care providers who cannot operate the equipment at the ends of their networks?

Universal service for health care providers, the FCC's major contribution to the growth of the telehealth industry, was mandated by the Telecommunications Act of 1996. A year and a half ago Congress asked us to encourage the development of telehealth in rural areas of the nation. More than 60 million Americans -- about one-quarter of the entire population, live in rural areas.

It is in rural America that distance is most likely to be a major impediment to timely access to health care services. Health care providers, particularly specialists, are fewer and farther between than in urban areas, and health care costs run high. Rural areas often suffer from the combination of lesser access and greater needs. In rural areas there are about 50% more trauma injuries than in urban areas, and about four times as many people die from them. Telehealth can make medical expertise available to these trauma patients and many others who are kept from superior health care by the surmountable obstacles of geography and distance.

To improve access to and quality of rural health care, Congress directed the FCC to make telecommunications services "necessary for the provision of health care services" available to rural public and non-profit health care providers at rates comparable to those in urban areas.

In May of this year the FCC released its Universal Service Order, which allocates up to $400 million a year to the estimated 12,000 eligible health care providers. This is the single greatest government commitment ever made to the development of telehealth.

The FCC decided that eligible providers will be able to choose telecommunications services of any transmission speed up to 1.54 Mbps (equivalent to a T-1, at rates comparable to those paid in urban areas. This support will apply to any type of telecommunications technology, including telephone, wireless, and satellite services.

In addition, universal service funds will cover a limited amount of toll-free access to the nearest Internet service provider. Health care providers who do not now have local access to an ISP are eligible for the lesser of $180 in toll charges or the amount of toll charges incurred for 30 hours a month to reach one.

It is our hope that universal service, as Congress intended, will be a great catalyst for the growth of telehealth in the rural areas in which it is potentially most beneficial.

It will address one of the great impediments to the development of telehealth at this point: the often prohibitively high costs of telecommunications services.

As you know, however, there are other factors inhibiting telehealth's growth. The purpose of today's forum is to work toward a solution to one of them -- the lack of sufficient equipment standards that has impeded the interoperability of telehealth equipment.

Other challenges, such as a lack of third-party payment policies for telehealth services, and the legal issues associated with practicing medicine across state lines, are beyond the FCC's scope, but it is our desire to do everything within our ability to facilitate the development of this new industry.

The need for greater interoperability of telehealth equipment was first brought to the FCC's attention by our Advisory Committee on Telecommunications and Health Care, a group of public and private sector experts whom we convened to help us shape effective universal service policy.

One member of the group, Dr. Eric Tangalos, from the Mayo Clinic, described the difficulty his institution faced as a result of incompatible equipment. The clinic made considerable investments in top-of-the-line telehealth devices only to find that they could not get them to communicate with other health care provider's equipment.

If a lack of plug-and-play interoperability is hampering the Mayo Clinic, how many other institutions must have similar complaints? This lack of adequate equipment interoperability is of particular concern to the health care providers targeted by universal service support. Public and non-profit rural health care providers often have small staffs, small budgets, and little experience in operating telecommunications equipment. Equipment purchased with scarce funds may be left unused if it cannot be incorporated easily into care givers' daily routines. Or, it may never be bought in the first place.

The need for telehealth standards has been identified by numerous groups. The January, 1997 Telemedicine Report to the Congress, issued by the Departments of Commerce and Health and Human Services, identifies the development and adoption of standards as an area of key importance. The February, 1997 GAO report Telemedicine also recommends the promotion of interoperable telemedicine system designs.

Since promotion of the development and adoption of telehealth equipment standards and interoperability does not fall exclusively within any one federal agency's purview, our Advisory Committee recommended that the FCC work with other agencies and private-sector groups to address the issue. When HOST, a consortium that focuses on the use of information technology to increase access to health care, suggested that we co-sponsor today's forum, the FCC seized the opportunity to collaborate with a broad range of telehealth stakeholders including HOST members, the FDA, the Department of Health, and the federal Joint Working Group on Telemedicine.

Our aim in convening this meeting with HOST and our other supporters is not to suggest any particular set of standards, but to identify needs and encourage the organizations represented here to work toward the creation and adoption of those standards that will best help the telehealth industry to mature. Industry-set standards will be of greatest benefit to both users and manufacturers of telehealth equipment.

The FCC's central philosophy is based on the positive force of competition. We prefer open standards because they enable competition by many firms. In a new market such as this, manufacturers may be tempted to design proprietary systems. Proprietary development paths may benefit a few firms in the very short-term, but in the long run, I believe that open standards will free the telehealth industry to develop at the greatest speed and in the most cost-effective manner.

Teleradiology is further ahead of other medical specialties in the use of telehealth in part because of the clearly defined DICOM standard. There is a great potential demand for other telehealth services, as access remains inequitably distributed across our population.

One of the greatest challenges facing the United States, and indeed, the world, is the provision of good quality, economically viable health care. As you know, the United States spends a trillion dollars a year -- about 15% of GDP -- on health care. Spending per person has more than tripled in the last twenty years.

According to some forecasts, health care spending is expected to increase by as much as 8% a year, reaching $2.2 trillion by 2005. The aging of the baby-boomer generation will intensify current financial pressures on the system.

The recent proliferation of managed care organizations attests to the attractiveness of this market and the need to decrease health care costs. The more global the consultations, the greater the opportunity for success, particularly taking into account the savings on travel costs. Manufacturers of telehealth equipment should consider the money to be made in offering not only high-end users but small, rural health care providers easy to use plug-and-play equipment.

Greater telehealth equipment interoperability would begin a virtuous economic cycle in rural areas in particular. As rural health care providers invest in telehealth equipment, they will demand higher speed data networks. Telecommunications carriers will then make their services more extensively available, which will encourage more health care providers to use them. And, as consumers have faster access to the Internet, they may choose to receive increasing amounts of health care information and services from their homes.

The goal of today's meeting, then, is to keep the ball rolling towards development of compatible telehealth equipment. Some members of the manufacturing industry, including ACR-NEMA, HL-7, and the Andover Group, have begun to address these issues. We would like to build on and broaden their efforts.

The FCC and HOST hope to facilitate an industry-driven adoption of standards and greater interoperability for telehealth equipment by more clearly defining the problem, building on what has been done, and framing possible solutions. Some of the questions you should consider today are the following:

* What barriers to the development of standards for telehealth equipment exist?

* Which specific types of standards are needed to facilitate the interoperability of telehealth equipment?

* If particular standards are set, who should codify, prototype, test, and maintain them?

* Which organizations have addressed the development of telehealth standards, and how can their efforts best be leveraged and coordinated?

* Are the approaches recommended by the FCC's Network Reliability and Interoperability Council for meeting the requirements of the Telecom Act of 1996 useful in developing standards for telehealth equipment?

* How does the development of standards for telehealth equipment relate to the broader development of standards for telecommunications services and applications?

* What role, if any, should the federal government play to encourage the development of standards for telehealth equipment?

It is our hope that the discussions you will have today will lead to concrete steps toward increased telehealth equipment standards and interoperability, and, ultimately, the facilitation of broader access to better health care services.