42 CFR § 417.410 - Qualifying conditions: General rules.
(a)Basic requirement. In order to qualify for a contract with CMS under this subpart, an HMO or CMP must demonstrate its ability to enroll Medicare beneficiaries and other individuals and groups and to deliver a specified comprehensive range of high quality services efficiently, effectively, and economically to its Medicare enrollees.
(b)Other qualifying conditions. An HMO or CMP must meet qualifying conditions that pertain to operating experience, enrollment, range of services, furnishing of services, and a quality assurance program.
(d)Application of standards. Application of the standards enables the surveyor to determine -
(3) The nature and extent of any deficiencies; and
(1) Meets all the applicable requirements in the statute and regulations;
(3) Has at least 75 Medicareenrollees or has an acceptable plan to achieve this Medicare membership within 2 years;
(2) The HMO or CMP meets the conditions for entering into a risk contract specified in paragraph (e) of this section except that CMS does not judge the HMO or CMP capable of bearing the potential losses of a risk contract.
(g) Regulations on reasonable cost and risk reimbursement are set forth in subparts O and P of this part.