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Friday, May 13, 2011
HMSA: Mail-order Pharmaceutical plan losing support of Hawaii Physicians
By Andrew Walden @ 5:45 PM :: 8969 Views :: Energy, Environment

by Andrew Walden

Hawaii is leading the nation in implementation of the Affordable Healthcare Act but parts of the program are already losing the support of doctors. 

In a letter of apology to Hawaii physicians dated May, 2011, John T. Berthiaume, HMSA’s Vice-President of Care Management admits doctors are experiencing “frustration” and “extra work” as HMSA rolls out cost controls and a “closed formulary” medical rationing program.

Why adopt a new system?  The letter makes HMSA’s reasoning clear:  “The new formulary is expected to save $4.5 million annually in drug costs.”

The “closed formulary” is a list of the prescription drugs covered by HMSA. Mail-order pharmacy Medco is HMSA’s formulary provider.

But is it patients who are paying the price for HMSA’s profits.  Berthiaume explains:

As part of its cost management, Medco places quantity limits on certain drugs to ensure the amount dispensed is consistent with prescribing guidelines. Please be aware that some low-cost generic drugs, such as prednisone, require prior authorization for medical diagnoses so that HMSA can properly direct coverage to either the patient’s Medicare part B or Part D benefits.

Berthiaume describes the “unanticipated impacts” of the transition to Medco formulary:

Physicians did not receive correct advance notice about changes to the formulary and/or coverage rules, such as new quantity limits for certain drugs; were not given timely information on prescribing options; and had unsatisfactory experiences when contacting Medco. Physicians said the new coverage review procedures were time-consuming. They reported servicing problems, such as long wait times on the phone and inconsistent answers, in dealing with Medco representatives. Finally, of 5,000 letters mailed to 1,600 patients and their 500 doctors regarding quantity limits, most were generated mistakenly due to a Medco system programming error….

It is not clear why HMSA could not “anticipate” such impacts.  Millions of Americans have been protesting against Obamacare for over a year now.  The bureaucratic interference, bungling, and rationing described in the HMSA letter reads like a caricature of what these “TEA Party” protesters have warned of. 

A Hilo doctor who received the letter would speak only anonymously due to fear of HMSA retaliation.  The doctor said:

“This is the first time I have ever seen an apology from HMSA for anything.  There must have been a huge outcry or possible legal implications.  The formulary changes weekly, so a patient on one prescription suddenly can't get it renewed.”

Medco’s website paints a different picture:

“At Medco, we take the view that we are our customers' champions - and we are committed to providing you with smarter solutions that give you more value in return for every dollar you spend.”

But Medco’s “customer” is HMSA—and Medco’s job is to save it’s customer $4.5M.  Patients obtaining their prescriptions are Medco’s products—and it shows.

Medco urges potential customers—insurance companies—“To learn more about how we can make pharmacy work for you, contact our Government specialists today at Medco New Business Inquiries.”  And then just in case patients don’t get the hint: “Note: Please do not use this e-mail address for member or benefit inquiries.”

Consumer-oriented websites such as and have dozens of Medco testimonials going back to 2005—nearly all negative.  A typical one reads:

The most recent complaint is with shortages and broken pills. I always count my pills because so many times I have been shorted. Ironically (or not) it happened most often with class 3 - darvocet.

I'd report the shortages via messaging on their web site and I'd sometimes get no response. Sometimes I'd write again or sometimes I'd give up. It happened so often I pressed it sometimes.

With the darvocet it did happen too often they must have an in-house problem with stealing one pill here and there of narcotic pain pills, so I kept insisting they replace the 1 or 2 pills they shorted my order.

In spite of Medco’s lengthy record, HMSA tells physicians their complaints “have been relayed” and additional staff training “will be provided”.  “Efforts to simplify…are underway.”  Physicians are promised “more timely updates” every time the closed formulary is changed and the telemarketers in Medco’s call center will even deign to establish “coverage during Hawaii hours of operation” and “streamline the handling of phone calls.”


FULL TEXT: HMSA Letter of Apology


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