[Code of Federal Regulations]
[Title 42, Volume 2]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR405.505]

[Page 96-97]
 
                         TITLE 42--PUBLIC HEALTH
 
                    CHAPTER IV--CENTERS FOR MEDICARE
                          & MEDICAID SERVICES,
                        DEPARTMENT OF HEALTH AND
                             HUMAN SERVICES
 
PART 405--FEDERAL HEALTH INSURANCE FOR THE AGED AND DISABLED--Table of Contents
 
         Subpart E--Criteria for Determining Reasonable Charges
 
Sec. 405.505  Determination of locality.

    ``Locality'' is the geographical area for which the carrier is to 
derive the reasonable charges or fee schedule amounts for services or 
items. Usually, a locality may be a State (including the District of 
Columbia, a territory, or a Commonwealth), a political or economic 
subdivision of a State, or a group of States. It should include a cross 
section of the population with respect to economic and other 
characteristics. Where people tend to gravitate toward certain 
population centers to

[[Page 97]]

obtain medical care or service, localities may be recognized on a basis 
constituting medical services areas (interstate or otherwise), 
comparable in concept to ``trade areas.'' Localities may differ in 
population density, economic level, and other major factors affecting 
charges for services. Carriers therefore shall delineate localities on 
the basis of their knowledge of local conditions. However, distinctions 
between localities are not to be so finely made that a locality includes 
only a very limited geographic area whose population has distinctly 
similar income characteristics (e.g., a very rich or very poor 
neighborhood within a city).

[57 FR 27305, June 18, 1992]