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26
The Argument for Universal Access to the Health Care Information
Infrastructure: The Particular Needs of Rural Areas, the
Poor, and the Underserved
Richard Friedman and Sean Thomas
University of Wisconsin
Statement of the Problem
The national information infrastructure (NII) offers an
opportunity for the poor, persons living in rural areas, and the
otherwise underserved to obtain a wide range of educational and
medical services to which they currently have only limited access.
These benefits can occur only if these groups gain access to the
NII. Universal access to the telecommunications infrastructure has
been a stated goal for many decades. As a result of a combination
of funding transfers, funded and unfunded mandates, and
regulations, the telecommunications industry has achieved a 94
percent overall telephone access rate. Unfortunately, the very
groups that may benefit most from access to the NII are the very
ones that have had the lowest penetration rate in the existing
telecommunications infrastructure.
Upgrading the current system to the higher bandwidths that will
be required for the interactive capabilities required in
telemedicine will be expensive. Unfortunately, current technologies
are making it possible for competitive access providers to bypass
the local access providers who are maintaining the existing
telecommunications infrastructure. They can preferentially provide
services at a discount to the lowest-cost clients. The local access
providers are left with the higher-cost users such as the poor and
rural population. They are increasingly finding this an
unreasonable burden, and many existing carriers are finding it
uneconomical to upgrade services to these populations.
These are the very populations that may benefit most from the
NII. The impact on their education and health care will be dramatic
and the benefits to society as a whole will be extensive. It will
therefore be necessary for society (i.e., the federal government)
to make sure that these populations have access to the NII. This
will require a new funding mechanism that no longer relies on
internal industry fund transfers. It will require additional
government subsidies, new taxes on competitive access providers, or
legislative mandates.
We argue that the best course would be a system of value-added
taxes on all services that use the NII. The funds from such taxes
could be used to underwrite the development and maintenance of the
NII.
Background
Rural education and medical services are in the midst of
dramatic changes. Shrinking rural populations are making community
schools and hospitals hard to justify. While many states have
legislated new curricula that attempt to improve the competency of
students, rural schools generally lack the funds to attract the
specialized teachers necessary for courses in these topics. In many
rural areas there is a shortage of physicians. Local hospitals are
being forced to close because they are noncompetitive. Medicare and
Medicaid provide decreased physician and hospital reimbursement in
rural areas. Many poorer patients in rural areas rely on Medicare
and Medicaid funding for medical services, yet these funds no
longer cover the costs of providing even these basic services. Many
residents of rural areas must travel long distances to regional
health care centers. Rural
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Representative terms from entire chapter:
universal access
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preventive medical care is compromised because of the greater
distances and limited access to services.
The economic competitiveness of rural areas is being compromised
because of their inability to access high-speed transmission lines
for electronic mail, telecommunications, video conferencing, and
access to large centralized data bases used by libraries, in
inventory control, and in updating of government records. Persons
living in rural areas must pay toll charges when contacting
government or regional health care offices, whereas residents in
larger cities have no such expenses.
The case has been made that the NII will make it possible for
rural, poor, and underserved populations to access high-quality
educational and health care resources. These resources have
previously been denied to these populations due to a combination of
factors that include their inability to access these resources, the
costs of these resources, and the limited number of high-quality
providers of these services who were willing to relocate at sites
convenient to these populations. If these services can be provided
via the NII at a level of quality comparable to that provided to
other populations, then the main impediment to these groups'
obtaining this benefit will be their ability to access the NII.
Distance education holds the promise of bringing specialized
teaching programs to poor and rural schools. Programs in foreign
languages, science, and the arts, which are not available due to
inadequate funding or class size, could be made available by video
linkages. Participation in government programs and the provision of
an "informed" electorate could result from improved access to
computer-based educational resources. Rural constituents could sign
up for government programs, renew licenses, submit applications for
benefits, and obtain many other services, thus avoiding the time
and expense now involved in travel to government offices. Health
care consultation by experts at distant regional health care
centers might be provided at local clinics. Preventive medicine
programs, health education, access to health resources, and rapid
clinical consultations are all possible consequences of access to
the NII.
The provision of high-quality educational and health care
services over the NII is currently being evaluated. Preliminary
studies have shown that high-quality services are possible. The
Mayo Clinic maintains video conferencing links between three sites
in Florida, Arizona, and Minnesota. It recently conducted a
telemedicine program linking its clinic in Rochester, Minnesota,
with the Pine Ridge Indian Reservation in South Dakota. The Medical
College of Georgia has several dozen sites on its telemedicine
network. This year it has begun trials with direct links to
patients' homes so that individuals recuperating from heart surgery
can be linked to their doctors for follow-up. The Navy runs a
teleradiology program estimated to save $14 million a year. Studies
in Georgia have shown that using telemedicine can increase the
number of patients admitted to rural hospitals. Rural hospitals
typically charge up to $500 less per day than hospitals in large
cities. Telemedicine offers a way to retain and retrain medical
professionals and help keep rural hospitals open.1
Norway funds the largest telemedicine program in the world. In
that country telemedicine is part of the government-run health care
system. Practitioners regularly conduct consultations in a variety
of specialties between remote hospitals and main academic centers.
One ENT specialist suggested that the number of cases he receives
from general practitioners has decreased by 50 percent since the
introduction of telemedicine consultations.2
The NII is already being used to provide a wide range of medical
information via bulletin boards, newsgroups, and electronic mailing
lists via the Internet and commercial services such as Compuserve,
Prodigy, and America Online. These services provide a great deal of
patient-oriented medical information. The World Wide Web (WWW), a
multimedia hypertext service, is the fastest growing component of
the Internet. It contains a plethora of medical services, including
newsgroups and bulletin boards as well as diagnostic, educational,
and preventive services. Most major state and federal health care
groups provide online access to their resources via the WWW. Many
medical schools and university hospitals already provide patient
information, course material, up-to-date medical literature, and
even consultative services via the NII.
Many clinical services are available via the NII. The problem
remains one of access. The cost of the computer equipment required
to interface with the NII is falling dramatically and will
eventually be only a small fraction of the expense of providing
quality educational and health care services by conventional
modalities. The main expense will be the heavy investment necessary
to bring the telecommunications infrastructure to the homes and
communities of all individuals, particularly those who are poor or
live in rural or inner city locations. Given
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their locations in either decaying, densely populated inner city
areas or widely distributed and sparsely populated rural locations,
it is extremely expensive to provide access.
The relatively low income of these individuals makes it unlikely
that commercial providers of the NII can profit from providing this
access. The commercial incentives for providing NII access to these
groups may not exist. However, the benefit to the nation of
providing quality education and health care to these individuals
will be great. Because economic benefit will accrue to the nation
as a whole rather than to the companies building and maintaining
the NII, the usual capitalistic incentives that would make
providing such services worthwhile are not appropriate. The
government must either subsidize the provision of such services or
somehow mandate that the providers of such services include these
populations as a condition of any license to provide services to
the remainder of the population.
In the past, mandates for rural electrification or universal
telephone access took care of this problem. At the time these
services were originally provided, it was decided that such
universal access was in the public good. The idea of universal
telephone service has been a foundation of the information policy
of the United States since the Communication Act of 1934 was
passed, creating the Federal Communications Commission
for the purpose of regulating interstate and
foreign commerce incommunications by wire and radio soas to make
available, so far as possible, to all the people of the
UnitedStates a rapid, efficient,nationwide, and worldwide wire and
radio communications service with adequatefacilities at
reasonablecharges, for the purpose of national defense, for the
purpose of promotingsafety of life and propertythrough the use of
wire and radio communications, and for the purpose ofsecuring a
more effectiveexecution of this policy by centralizing
authority.
The current telephone penetration rate for U.S. households is
approximately 94 percent.3 In
addition, approximately 1.3 percent have a phone available or
nearby. Roughly 4.5 percent of Americans (4.4 million households
and 11.6 million individuals) have no telephone available.4
With respect to at-risk populations, the elderly actually do
better than young parents with children with respect to telephone
access. Access to telephone service for retired persons at all
income levels is at the national average or better. Among the
elderly, only those persons receiving Supplemental Security Income
have a lower than average penetration of telephones (79.7 percent
to 84.9 percent).5 The disparity in
access to telephone service is most pronounced for people of all
ages with low incomes. It is noted that 31 percent of all families
receiving food stamps have no telephone.6 For families completely dependent on
public assistance the percentage rises to 43.5.
Only 2.2 percent of homeowners have no telephone, but 21.7
percent of persons in public housing have no telphone and 40.2
percent of those living in hotel rooms or boarding houses have no
telephone. Women and children are particularly vulnerable.
Households headed by women with children who are living at or below
the poverty line have a telephone penetration rate of only 50
percent. Race and ethnic background appear to confound the impact
of income on telephone access. The percentage of white households
without telephones is 8 to 10 percentage points lower than black
and Hispanic households.
Persons living in rural communities outside metropolitan areas
lack telephones in 9.9 percent of cases. In rural New Mexico only
88 percent of all households have phone service. In the Four
Corners areas of Colorado, New Mexico, Arizona, and Utah, where
36,000 Navajo households are scattered about on 27,000 square
miles, 21,300 households (63 percent) have no telephones. In that
region installation fees can range as high as $5,000 for a single
telephone.7
It therefore appears that factors that affect telephone
penetration are low income, household headed by a woman with
children, race and ethnicity, and rural location. Yet these are the
very groups that would appear to benefit from the recent advances
in telecommunications.
Analysis
Today the public mandate for universal access is being removed
or bypassed, and in some rural areas, universal access to telephone
or electrical utilities does not in effect exist. To obtain these
services the user must
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pay for linkages to trunk lines that may be at a considerable
distance from the home. The cost of such a link can be expensive.
Consequently, many rural areas do not have cable or cellular
telephone services. The equipment for new high-bandwidth
connections necessary to provide state-of-the-art NII services may
be prohibitively expensive for many rural and/or inner-city
users.
However, these are the groups most likely to benefit from such
services. The improvement in their education and health care will
in turn be of great benefit to society in general. Once NII access
is provided, the provision of such educational and health care
services to these groups will represent only a modest additional
marginal expense. It therefore is in the interest of the government
and the general population that the NII is made available to these
populations and furhter that it is provided as a governmental
service or as a government mandate to the providers of such
services.
The current method for providing near universal access to
telephone services relies on funding transfers among carriers,
transfers from other service providers, transfers between
customers, and government contributions. The primary transfers have
been from business and toll service users to basic residential
subscribers and from urban to rural exchanges. Before the AT&T
divestiture, these transfers were accomplished largely within a
single corporate umbrella. Since then the systems has become more
complex, with a system of rules governing transfers among carriers
based on political compromise rather than economic logic. Currently
there are three major fund transfer mechanisms: (1) funds
transferred from toll services to local access providers, (2)
transfer from low-cost local exchanges to high-cost local exchanges
(i.e., from urban to rural exchanges), and (3) differential
allocation of local service costs through rates charged to
different customer classes (i.e., higher rates for business than
for residential users). There is also a system of subsidization for
social support services such as lifeline programs for low income
customers, 911 emergency services, and services for the hearing
impaired, all of which are covered through local telephone
charges.8
With the arrival of increased competition and the exponential
growth of providers of equipment, toll services, business services,
etc., the rules are being altered. The difference between core
services and access lines is blurring. As fiber and other broadband
media continue to move into local neighborhoods and business
districts and as the already existing cable networks begin to offer
switched services, the points of interconnection among these
paradigms are changing. The growth of alternate access providers
has made it possible for large toll customers to directly connect
to toll service providers without paying the usage-based
within-system transfers that were traditionally collected through
local access carriers. As local exchange competition develops, it
will be more difficult for local exchange carriers to support
high-cost areas or provide the default capacity relied on for
system backup by competitive network providers. As cable television
networks and wireless personal communication networks develop, they
will make it more difficult for local access providers to continue
to provide social services below cost. They will also threaten the
ability of local exchange carriers to provide service to high-cost
customers (inner city, rural, poor, etc.).9
The recent advances in communication technologies have raised
the concern as to what is a reasonable basic telecommunications
service. Is it plain old telephone service (POTS), fiber optics,
microwave, satellite uplinks, etc.? Is there a single basic service
modality? Some newer communications modalities such as cellular
telephone access may be less expensive to provide to rural areas
than are telephone lines, but the equipment to receive these
services may be more expensive (i.e., cellular telephones). Will
the telephone companies be required to provide only access, or
access and equipment? What will be the minimum bandwidth that these
companies will be required to supply?
If one agrees that there should be universal telecommunications
access to the NII, then one must next decide the minimum bandwidth
that should be allocated. Will it be for audio communication only,
as previously defined, or must it now include video and computer
communication capabilities? If it includes video, will it be single
frame or action capabilities? Will it be five frames/s or the full
30 frames/s necessary for true action video? Will it be only black
and white, or should it include color? For computer communication
capabilities what will be the necessary speed? This is a
particularly difficult challenge because we must select a bandwidth
that is broad enough to supply a range of services (audio,
freeze-frame video, action video, data interchange, etc.) yet
economically realistic.
In deciding the minimum level of services to be provided we must
also realize that the method of connecting to the NII will not be
uniform. Some areas already have an extensive communications
infrastructure
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in place, and therefore it may be more economical to upgrade
that existing infrastructure than to replace it wholesale. In other
areas where no such infrastructure exists, consideration might be
given to providing a newer technology. In some areas wireless
communication may be more reasonable, while in others a cable
system will be appropriate. After dealing with a relatively stable
technology (twisted pair telephone line) for many decades, we are
now faced with a rapidly changing panoply of technologies (digital
telephone lines, fiber optic cables, microwave towers, satellite
linkages, etc.) with variable communication bandwidth. In addition,
the bandwidth of each modality is changing rapidly. Existing
twisted pair analog telephone linkages can be upgraded to digital
lines (ISDN), thus increasing their bandwidth. Using compressed
video techniques, we can send video images over traditional
telephone lines today in a manner not possible only six months
ago.
It would appear that the minimal service configuration should be
determined not by the physical type of linkage but rather by its
bandwidth capability (i.e., its ability to attain a level of
service rather than the physical configuration of that
service).
Another major consideration must be the connecting focal point
of that communication. Traditionally the communication linkage was
to a physical location (home or office). Universal communication
meant that all Americans had access to a telephone in their living
space. This too is changing. We are now able to provide cellular
communication linkages to individuals rather than to physical
structures. Shortly we will be able to provide a seamless linkage
across the entire nation so that one can move from cellular cell to
cell without needing to register in the new area. The minimum
standard for telecommunication access may involve service not to a
physical household or building but rather to an individual.
In the health care field one could argue that fully interactive
video capabilities are necessary if we are to be able to provide
remote delivery access. Certainly, to provide remote consultation
such video capabilities are necessary. However, if one is to
provide remote teleradiology services, a higher bandwidth is
necessary; to supply only patient information access and preventive
services information, then perhaps a lower bandwidth would be
appropriate.
Finally, if we are to provide universal service then we must
define not only the bandwidth of that service but also its
capabilities. In the past, universal access included access to the
physical telephone. Does universal access now involve access to
video equipment, computers, high-resolution screens, etc.? We now
can use stethoscopes, otoscopes, and ophthalmoscopes at remote
sites via telemedicine facilities. Will we include a remote
stethoscope as the minimum telecommunications configuration in
every household where a person with hypertension resides? In the
end it would save lives and might be cost effective.
The major problem remains, Who is to maintain the NII? In the
past these costs were either mandated to the carriers, who added
them to the general cost of the service, or were explicitly
included as an item on the bills of users of the system. They were
essentially mandated "unfunded" government benefits, which are now
unpopular and insupportable. We must therefore determine another
way to support these services. This will become particularly
important as access to the NII becomes a "portable" access that is
not tied to a physical location.
Given the increasingly "portable" nature of this service, it
will become more difficult to add the cost to a basic local access
service charge. The concept of the local access company may
gradually disappear as wireless systems spread. The only reasonable
way to finance such a system is either via a tax on all
telecommunications services or by government funding of the basic
access service.
There are many ways the government can sustain the idea of
universal access. One would be to mandate that the local access
provider in a particular area provide service to all households and
businesses or individuals living in that area at the same basic
rate. This would continue the practice of cross subsidization
within a local area and might make some local provider areas
unprofitable for any carriers. One could set up a bidding system
for local access provider areas, with the highest bidder getting
the franchise for the area. These funds would then be available to
subsidize services in local access areas that were not cost
effective and did not attract any bidders. This would also result
in cross-subsidization since companies successfully bidding for the
more sought-after franchises would pay a higher fee and therefore
find it necessary to charge higher tariffs to their customers. The
major problem with this proposal is that the whole idea of a local
access area is changing. The physical access location may be an
individual. Would the area then become all the persons living in
that area, working in the area, and visiting the area? Wireless
communication negates the importance of the local access area. In
addition,
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microwave and satellite linkages make it possible for commercial
access providers to bypass the local access provider. Such a
mandate might be unenforceable.
A second method would be to follow that utilized in Japan, where
the government supports local telecommunications services to all
households. With this method the government could decide a basic
level of services to all households or individuals and determine
the most cost efficient method for providing it, be it telephone
line, microwave tower, cellular telephone, etc. The government
would then contract with commercial providers to provide these
services. Such contracts could be "bid" to the lowest-cost provider
who would agree to supply all households or individuals in an area
for a set fee.10 Such an undertaking
would be very expensive and would have to be funded from tax
revenue. This would, once again, result in a major cross
subsidization from higher taxed groups to other groups. The chances
of legislating a tax to pay for the free provision of services that
most of us already pay for would be remote.
A third approach would be to use value-added service surcharges.
These would be calculated as a fixed percentage of gross revenues
that potentially could be collected from all businesses selling
value-added telecommunication services. Value-added services
include the services of all service providers interconnecting with
the public switched network, except local loop services provided to
homes, businesses, or eventually individuals by state-certified
common carriers with provider-of-last-resort obligations.11 The value-added tax would be the
easiest to monitor. Funds from this tax could be used to subsidize
basic services to all household or individuals.
The government has the most to gain in promoting universal
telecommunications services. If, as expected, it improves our
educational system, provides continuing medical education services,
enchances health care, and brings these services to the poor,
underprivileged, and rural populations, then the government (which
currently supplies many expensive remedial series to these groups)
would benefit the most. A better educated, healthier, and better
informed electorate would greatly benefit the federal government.
These benefits would be to the collective good and might not
necessarily accrue to the companies supplying these
telecommunication services. The government must therefore be the
supplier of last resort.
Recommendations
Basic Levels of Service
The level of service must include a bandwidth specification
based on type of service. We would argue that two-way, real-time
video communication is the minimum level of service that should be
accepted. Current twisted pair telephone communication will not
realize this level of service, but combined digital circuits, fiber
optic cables, and microwave and satellite modalities certainly can
achieve this standard. There need be no single modality used for
the NII. Depending on the area and/or population, a combination of
these modalities might be appropriate.
Physical Access Unit
We believe that the access unit must gradually change from the
household to the individual. We believe mobile communication will
continue to grow to the point that we will have individual
telephone numbers or IP numbers of telecommunication access
numbers. An actual geographic access location will cease to be
important.
Access Modality
We believe that there will be a gradual movement from the
telephone as the standard of access to the NII into a broader audio
and video interface. As a part of universal access, each home,
business, and individual will have both audio and video
capabilities as well as some minimal computer component. It is
still too early to clearly define the actual instrument that will
provide this interface, but it will surely be more complex than
the
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telephone. We must, however, begin to define the basic
capabilities of this unit because it will dictate the level of
service available.
Method of Funding Universal
Access
We favor a value-added tax on the gross revenues of all
providers of telecommunications services. This would include not
only competitive access providers but also groups that use the NII
to provide data, entertainment, news, financial information, etc.
Such a tax is the easiest to calculate and enforce. It should raise
enough money to fund the basic telecommunications infrastructure.
The government would fund the entire NII with funds from this tax.
Once the bandwidth and physical access unit were agreed upon, the
government would solicit bids for the supplying of services to a
particular area. The suppliers would agree to supply services to
all individuals or households in the designated area. As the
physical access unit gradually changed from the household or
business to the individual, the actual georgraphic area might be
replaced by population groupings.
We believe that the government must provide an NII, that it
cannot be achieved through a nonregulated environment. The benefits
are potentially too great to allow any segment of the population to
be "displaced" because of limited commercial cost-benefit analysis.
We must consider the total benefit of universal access, and this
can be done only with government intervention. Continued government
involvement can result in efficiencies of scale, uniform standards,
and universal access.
References
Beamon, Clarice. 1990.
"Telecommunications: A Vital Link for Rural Business," OPASTCO
Roundtable.
Belinfante, A. 1991. "Monitoring Report:
Telephone Penetration and Household Family Characteristics," No.
CC, Docket No. 80-286. Federal Communications Commission,
Washington, D.C.
Bumble, W.A., and G.J. Sidak. 1993.
Toward Competition in Local Telephone Markets. MIT Press,
Cambridge, Mass.
Dordick, H.S. 1990. "The Origins of
Universal Service," Telecommunication Policy
14(3):223–38.
Dordick, H.S., and M.D. Fife. 1991.
"Universal Service in Post-divertiture USA," Telecomunications
Policy 15(2):119–28.
Gallottini, Giovanna T. 1991.
"Infrastructure: The Rural Difference," Telecommunications
Engineering and Management 95(1):48–50.
Hudson, Heather E. 1984. When
Telephones Reach the Village: The Role of Telecommunications in
Rural Development. Ablex, Norwood, New Jersey.
Mueller, M.L. 1993. "Universal Telephone
Service in Telephone History: A Reconstruction,"
Telecommunications Policy 17(July):352–69.
Notes
1. See Linder, A. 1994 "Global
Telemedicine and the Future of Medical Science," Healthcare
Informatics, November, pp. 63–66; and McGee, R., and E.G.
Tangalos. 1994. "Delivery of Health Care to the Underserved:
Potential Contributions of Telecommunications Technology," Mayo
Clinic Proceedings, Vol. 69, pp. 1131–1136.
2. Linder, A. 1994. "Global Telemedicine
and the Future of Medical Science," Healthcare Informatics
November, pp. 62–66.
3. Schement, J.R. 1994. "Beyond Universal
Service: Characteristics of Americans Without Telephones,
1980–1993," Communications Policy Working Paper #1, Benton
Foundation, Washington, D.C.
4. Belinfante, A. 1989. "Telephone
Penetration and Household Family Characteristics," No. CC, Docket
No. 87-339. Federal Communications Commission, Washington, D.C.
5. Schement, J.R. 1994. "Beyond Universal
Service: Characteristics of Americans without Telephones,
1980–1993," Communications Policy Working Paper #1, Benton
Foundation.
6. Belinfante, A. 1989. "Telephone
Penetration and Household Family Characteristics," No. CC, Docket
No. 87-339. Federal Communications Commission, Washington, D.C.
Page 216
7. ''How to Flourish in an All Digital
World," Wilt Letter, Vol. 1, No. 4, December 21, 1993.
8. Hudson, Heather E. 1994. "Universal
Service: The Rural Challenge Changing Requirements and Policy
Options," Working Paper #2, Benton Foundation, Washington, D.C.
9. Egan, B.L., and S. Wildman. 1994.
"Funding the Public Telecommunications Infrastructure," Working
Paper #5, Benton Foundation, Washington, D.C.
10. Egan, B.L., and S. Wildman. 1994.
"Funding the Public Telecommunications Infrastructure," Working
Paper #5, Benton Foundation, Washington, D.C.
11. Egan, B.L., and S. Wildman. 1994.
"Funding the Public Telecommunications Infrastructure," Working
Paper #5, Benton Foundation, Washington, D.C.
