§ 54.675   Cap.

   (a) Amount of the annual cap. The aggregate annual cap on federal
   universal service support for health care providers shall be $571
   million per funding year, of which up to $150 million per funding year
   will be available to support upfront payments and multi-year
   commitments under the Healthcare Connect Fund.

   (1) Inflation increase. In funding year 2018 and the subsequent funding
   years, the $571 million cap on federal universal support in the Rural
   Health Care Program shall be automatically increased annually to take
   into account increases in the rate of inflation as calculated in
   paragraph (a)(2) of this section.

   (2) Increase calculation. To measure increases in the rate of inflation
   for the purposes of this paragraph (a), the Commission shall use the
   Gross Domestic Product Chain-type Price Index (GDP-CPI). To compute the
   annual increase as required by this paragraph (a), the percentage
   increase in the GDP-CPI from the previous year will be used. For
   instance, the annual increase in the GDP-CPI from 2017 to 2018 would be
   used for the 2018 funding year. The increase shall be rounded to the
   nearest 0.1 percent by rounding 0.05 percent and above to the next
   higher 0.1 percent and otherwise rounding to the next lower 0.1
   percent. This percentage increase shall be added to the amount of the
   annual funding cap from the previous funding year. If the yearly
   average GDP-CPI decreases or stays the same, the annual funding cap
   shall remain the same as the previous year.

   (3) Public notice. When the calculation of the yearly average GDP-CPI
   is determined, the Wireline Competition Bureau shall publish a public
   notice in the Federal Register within 60 days announcing any increase
   of the annual funding cap based on the rate of inflation.

   (4) Amount of unused funds. All funds collected that are unused shall
   be carried forward into subsequent funding years for use in the Rural
   Health Care Program in accordance with the public interest and
   notwithstanding the annual cap. The Administrator shall report to the
   Commission, on a quarterly basis, funding that is unused from prior
   years of the Rural Health Care Program.

   (5) Application of unused funds. On an annual basis, in the second
   quarter of each calendar year, all funds that are collected and that
   are unused from prior years shall be available for use in the next full
   funding year of the Rural Health Care Program in accordance with the
   public interest and notwithstanding the annual cap as described in this
   paragraph (a).

   (b) Funding year. A funding year for purposes of the health care
   providers cap shall be the period July 1 through June 30.

   (c) Requests. Funds shall be available as follows:

   (1) Generally, funds shall be available to eligible health care
   providers on a first-come-first-served basis, with requests accepted
   beginning on the first of January prior to each funding year.

   (2) For the Telecommunications Program and the Healthcare Connect Fund,
   the Administrator shall implement a filing window period that treats
   all eligible health care providers filing within the window period as
   if their applications were simultaneously received.

   (3) [Reserved]

   (4) The deadline to submit a funding commitment request under the
   Telecommunications Program and the Healthcare Connect Fund is June 30
   for the funding year that begins on the previous July 1.

   (d) Annual filing requirement. Health care providers shall file new
   funding requests for each funding year, except for health care
   providers who have received a multi-year funding commitment under
   § 54.644.

   (e) Long-term contracts. If health care providers enter into long-term
   contracts for eligible services, the Administrator shall only commit
   funds to cover the portion of such a long-term contract scheduled to be
   delivered during the funding year for which universal service support
   is sought, except for multi-year funding commitments as described in
   § 54.644.

   (f) Pro-rata reductions for Telecommunications Program support. The
   Administrator shall act in accordance with this section when a filing
   window period for the Telecommunications Program and the Healthcare
   Connect Fund, as described in paragraph (c)(2) of this section, is in
   effect. When a filing window period described in paragraph (c)(2) of
   this section closes, the Administrator shall calculate the total demand
   for Telecommunications Program and Healthcare Connect Fund support
   submitted by all applicants during the filing window period. If the
   total demand during a filing window period exceeds the total remaining
   support available for the funding year, the Administrator shall take
   the following steps:

   (1) The Administrator shall divide the total remaining funds available
   for the funding year by the total amount of Telecommunications Program
   and Healthcare Connect Fund support requested by each applicant that
   has filed during the window period, to produce a pro-rata factor.

   (2) The Administrator shall calculate the amount of Telecommunications
   Program and Healthcare Connect Fund support requested by each applicant
   that has filed during the filing window.

   (3) The Administrator shall multiply the pro-rata factor by the total
   dollar amount requested by each applicant filing during the window
   period. Administrator shall then commit funds to each applicant for
   Telecommunications Program and Healthcare Connect Fund support
   consistent with this calculation.

   [ 78 FR 13992 , Mar. 1, 2013, as amended at  83 FR 30584 , June 29 2018]

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