The President and the Power of the Purchaser: Consumer Protection and Managed Care in the United States

by Daniel Gitterman

Fall 2000

Volume 43
Issue 1

Full Article Browse Issue



This article highlights the President’s formal and informal capacity to act unilaterally, and thus potentially to regulate managed care on his own, through the government’s role as a buyer—what is referred to here as the "power of the purchaser." Presidents can act independently to shift policy in any way they wish, and there it will stay until and unless either Congress, the courts, or the market effectively responds. By the strategic use of executive orders and directives to the federal bureaucracy, President Clinton has used the "power of the purchaser" to implement a range of consumer protections as a condition in any contract between federal "public" purchasers and health plans. In practice, those health plans and insurers wishing to do business with the federal government must meet the President’s terms; others either need not enter into a contract or exit ex-post when they oppose the nature of the new provisions.

California Management Review

Berkeley-Haas's Premier Management Journal

Published at Berkeley Haas for more than sixty years, California Management Review seeks to share knowledge that challenges convention and shows a better way of doing business.

Learn more
Follow Us