About USAC

Appeals & Audits

Common Audit Findings: Rural Health Care Program

In USAC's continuing efforts to ensure carriers are successful at implementing FCC rules and program requirements, we have put together a list of some of the most common problem areas identified during audits and Payment Quality Assurance (PQA) reviews.

For more information about the audit process, review the BCAP page of our website. Using this information will help to expedite the audit process and should reduce or eliminate audit findings in the future.

Audit Findings

For each common audit finding, we have outlined a description of the finding and some ways to prevent a finding like this in the future. We have also, where possible, provided some examples.

Causes

Understanding multiple programs with different rules is complicated. Rural Health Care (RHC) Program non-compliance is most often caused by an inadequate knowledge of or familiarity with program rules. USAC will continue to provide clarification and information to applicants in an effort to improve program compliance and success.

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FINDING: Ineligible Entity Type

Description of Finding

Ineligible entities (e.g. administrative offices, long-term care facilities, etc.) received funding for services. Any facility that does not meet all three of the requirements listed below is considered ineligible for funding:

  1. Must be a not-for-profit or public entity.
  2. Must be one of the following types of entities:
    1. Post-secondary educational institutions offering health care instruction, such as teaching hospitals and medical schools,
    2. Community health centers or health centers providing health care to migrants,
    3. Local health departments or agencies,
    4. Community mental health centers,
    5. Not-for-profit hospitals,
    6. Rural health clinics,
    7. Consortia of HCPs consisting of one or more of the above entities,
    8. Dedicated emergency departments of rural for-profit hospitals, or
    9. Part-time eligible entities located in facilities that are ineligible.
  3. Must be located in an FCC-approved rural location, if participating individually. In the Healthcare Connect Fund (HCF), non-rural HCPs may be eligible to participate as a member of a consortium.
Example: Ineligible Facility Received Funding

Services were provided to ineligible facilities (e.g., administrative offices, long-term care facilities, etc.).

How to Address or Prevent this Finding

We encourage you to:

  • Familiarize yourself with the RHC Program eligibility requirements.
  • Contact the RHC Program Help Desk with any questions related to eligibility and other program-related topics.
  • Describe your facility and certify to the accuracy of the information (FCC Form 465, Blocks 4 and 6, for the Telecom Program and FCC Form 460, Blocks 5-7, for the HCF Program). By providing a clear and thorough description of the facility, our team will be able to properly determine the eligibility of your site.

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FINDING: Services Not Being Used

Description of Finding

According to program rules, facilities must only use funded services solely for the purpose of providing healthcare (47 C.F.R. Section 54.603(b)(iv) and Section 54.642 (e)(1)(iii)). A common finding is that facilities are not using their funding as intended.

Example: Facility Closed

A facility did not inform USAC that health care provider sites had closed during the funding commitment time period and that they no longer were using the supported services to provide health care.

How to Address or Prevent this Finding

You must inform USAC if you are not using any of your funded services. This includes but is not limited to the result of a facility closing or service termination. Once you inform us of the end of service, we will make commitment adjustments and send you a revised Funding Commitment Letter.

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FINDING: Service Provider Involvement in Beneficiaries' Competitive Bidding Process

Description of Finding

RHC Program applicants must obtain services through a fair and open competitive bidding process. This means that all potential bidders must have access to the same information and the same opportunity to provide services.

Example: Conflict of Interest

Service providers assisted in preparation of the request for services and/or Request for Proposals (RFP), and participated in the evaluation of the bids received.

How to Address or Prevent this Finding

Avoid potential conflicts of interest and ensure an open and fair competitive bidding process by knowing the service providers role in bidding. If in doubt, call the RHC Program Help Desk. Be aware of these basic principles:

  • Service providers who plan to bid cannot:
    • Prepare, sign, or submit an applicant's FCC Form 461 or 465;
    • Serve as a point of contact on your behalf;
    • Be involved in developing bid evaluation criteria; or
    • Participate in the bid evaluation or service provider selection process.
  • Potential bidders must have access to the same information and must be treated in the same manner throughout the competitive bidding process. If you modify your form or related supporting documents, you must send the updated documents to USAC immediately to update the information on our website.
  • All applicants and service providers must comply with applicable state or local competitive bidding requirements.

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