StacksVerified U.S. regulatory reference

42 CFR §417.546

Verified against eCFR.gov as of June 20, 2026View official text on eCFR.gov ↗
General principle. The amount paid by an HMO or CMP for physicians' services and other Part B supplier services furnished under arrangements is an allowable cost to the extent it is reasonable. Costs are considered reasonable if they—
  1. (a)Do not exceed those that a prudent and cost-conscious buyer would incur to purchase those services; and
  2. (b)Are comparable to costs incurred for similar services furnished by similar physicians or other suppliers in the same or a similar geographic area.