FCC reaches $1.2m settlement to Windstream for RHC program violation

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The Federal Communications Commission (FCC) has reached a US$1.2 million settlement with Windstream Communications for violating the commission's Rural Health Care Program rules.

Specifically, Windstream will pay a total of $1,204,445.24, which includes a $200,000 civil penalty, and implement 'enhanced' compliance measures in relation to its participation in the Rural Health Care (RHC) program.

Through its investigation, the FCC Enforcement Bureau’s fraud division found that Windstream did not employ any of the three rate-setting methods service providers are required to use under FCC rules, instead it used its own methods to prepare bids and request Universal Service Fund (USF) support. The company was also unable to provide the commission with enough documentation to show the processes used to set its rural rates.

The USF is a system of telecoms subsidies and fees managed by the FCC, and the investigation found that Windstream received over $1 million in improper payments from the USF related to rural rate violations, from 2017 through to 2020. The company will now repay this in full.

“To facilitate the proper distribution of funds for these limited and invaluable resources, we vigorously pursue violations of the commission’s Rural Health Care rules to ensure that funds designated for rural areas and health care providers are available to program participants with no entity receiving an improper or disproportionate share,” said Loyaan A Egal, acting chief of the FCC Enforcement Bureau.

The Rural Health Care Program provides financial support to eligible rural health care providers so that all health care providers—whether they are located in rural or urban areas—can implement the next-gen communications systems. The RHC Program’s Telecommunications Program is paid for through the USF.

The carrier providing the eligible services must provide services at the urban rate and is entitled to support payments from USF to account for the difference between the urban rate and the rural rate, which is generally higher.