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

Abstract

This article highlights the President's formal and informal capacity to art 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 art 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.