CMS Pub. 100-01, ch. 5, § 80

An HMO for Medicare purposes is a public or private organization that provides, either

directly or through arrangement with others, comprehensive health services to enrolled

members. An HMO must service those who live within a specified service area. It must

provide services based on a predetermined periodic rate or periodic per capita rate basis

without regard to the frequency or extent of covered services it furnishes. An HMO must

also meet other statutory requirements.

An HMO's service area is a geographic area in which a full range of its services are

offered to its members. This geographic area differs from an HMO's enrollment area

since it may include locations outside its service area where it offers less than its full

range of services. (For example, an HMO may cover house calls in emergencies in its

service area but not for members who live outside the service area.)

Section 1876 of the Act allows a Medicare beneficiary eligible for Part A and Part B, or

Part B only, to choose to have covered items and services furnished through a Medicare

qualified HMO. An HMO enters into a contract with the Secretary in order to participate

under Medicare.