Research Information

A bitter pill for Medco?

Publication: THE INDIANAPOLIS STAR
Publication date: Saturday, July 24, 2010
Page number: A01
Edition: Final
Section: News
Day: SAT
Byline: John Russell
Byline ID: john.russell@indystar.com
Copyright:
RESALE: Yes
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A bitter pill for Medco?

Union says automated pharmacy forces its workers to fill prescriptions at unsafe speed

John Russell

The gleaming glass building in Boone County is enormous, larger than six football fields, and is crammed with millions of pills and capsules for just about any disease.

The owner, Medco Health Systems, calls it the "world's largest, most advanced automated pharmacy," with a capacity to dispense more than 1 million prescriptions a week through the mail. The pharmacy opened earlier this year but is still months away from ramping up to full production.

In its news releases and letters to shareholders, Medco boasts of its speed, efficiency and technology. But some critics question whether Medco is pushing pharmacists too hard and placing public safety in jeopardy.

The United Steelworkers, which represents Medco pharmacists and technicians in Florida, Nevada, New Jersey, Pennsylvania and Texas, said the company makes high demands on its professional workers, requiring them to work at a pace some pharmacists think is too fast.

New Jersey-based Medco said it sets no quotas for pharmacists and works hard to fill prescriptions safely and accurately.

"Our longtime operating policy is that we have performance standards to ensure we maximize the delivery of both quality of care and cost effectiveness," Medco spokeswoman Ann M. Smith said in an e-mail.

The union confirmed it is in the early stages of trying to organize workers in Indiana, saying its top goal is to help pharmacists keep professional control over dispensing of drugs, without being pushed at an unsafe pace.

Last month, Medco pharmacists in Franklin Lakes, N.J., turned down a company offer for a new contract. The Steelworkers said the sticking point had to do with "unreasonable production requirements."

"If a pharmacist can't read or decipher or understand the prescription, they will have to call the doctor's office to get to the bottom of it," said Maria Somma, international organizing coordinator with the Steelworkers' Health Care Workers Council in Pittsburgh. "That takes longer, and the company doesn't like it."

For years, pharmacists throughout the industry have complained about long hours and high pressure.

With a national shortage of pharmacists, and chains competing to dispense prescriptions faster, some observers say patient safety could be at risk.

"The large chains push their pharmacists to work 10, 12, 14 hours a day at a pace that is often a blur," said Daniel Hussar, a pharmacy professor at the University of the Sciences in Philadelphia and editor of the Pharmacist Activist, an online newsletter. "Some people thrive at that pace, but some can't. Overall, I think it's a recipe for more errors."

Medco said it spends millions of dollars on technology to fill prescriptions safely and accurately, and by doing so, it is trying to reduce the workload and possibility for human error.

In 2005, the company published the results of an in-house study that concluded it had an error rate of less than one in every 1,000 prescriptions, including zero errors in dispensing the correct drug, the correct dosage and correct form (tablet or capsule, for example).

The company compared that with an earlier study by Auburn University that found a national error rate of nearly one in every 55 prescriptions filled.

Some pharmacy experts in Indianapolis say they have not heard of any labor issues so far at Medco's operations at AllPoints at Anson, just west of Zionsville.

"I have not heard of any reports of overwork by any means," said Bruce Clayton, associate dean of Butler University's College of Pharmacy and Health Sciences.

But the company's own employees have said Medco pushes the limits.

In a dramatic move that captured industry attention several weeks ago, a former Medco pharmacist in Florida began a hunger strike, saying he was unfairly fired in 2005 for complaining about a policy that pharmacists process at least 45 prescriptions an hour. He said that requirement led to a high number of errors and put patients in jeopardy.

The pharmacist, Raj Bhat, said he began his hunger strike to call attention to the issue after a judge recently dismissed his lawsuit against the company. He is appealing the judge's ruling.

"Errors are bound to happen under that kind of unreasonable pace," Bhat said in a recent telephone interview. "Who is going to be getting the wrong medication?"

In 2003, more than 40 Medco pharmacists in Florida signed a letter and sent it to state health authorities, protesting the company's demands to speed up their work to a pace of less than two minutes per prescription, even if the prescription was illegible or incomplete.

"The unrelenting pressure and threat of disciplinary action in relation to ever-increasing rates and professional judgment issues has created a situation which puts patient health at grave risk," the letter said.

They said that beginning in 2002, Medco started pressuring pharmacists to increase their number of prescriptions to unsafe targets of up to 55 an hour. Some of them complained and others quit, said Randall O. Reder, an attorney in Tampa, Fla., who represents Bhat.

He said Bhat pleaded with his supervisors to stop the quotas, pointing out that the company's director of pharmacy practices told pharmacists in early 2004 that external errors during a recent week reached more than 300 parts per million, the worst in company history. But when they didn't take any corrective steps, Bhat sent letters to company executives and later to the state pharmacy board.

Reder said Medco fired his client in retaliation for complaining to state authorities about the situation. "The company said it was for poor performance, but we have the records of other pharmacists who performed more slowly than he did and weren't disciplined."

Medco said that its Office of Ethics investigated Bhat's issues "and found they were without merit or foundation." The Florida Board of Pharmacy also investigated and found they were without merit, the company said. In addition, Medco won a summary judgment earlier this year, and a judge dismissed Bhat's allegations.

Still, Florida law does not address how a pharmacy can operate, nor does it set limits on a company's demands on its pharmacists, aside from a general mission of protecting public health.

"There is nothing that allows the board to set a maximum number of prescriptions that a pharmacist may fill in a specific time period," the Florida Department of Health wrote to Bhat in August 2005, after he was fired. "The responsibility for that determination is left to the individual pharmacist. As in your case, your concern for patient safety outweighed the company's concern and unfortunately, you were punished by Medco."

Indiana has similar laws, with no restrictions on the number of prescriptions dispensed in a certain time frame. "However, all pharmacies must adhere to quality standards, and we do random audits to see if they are doing so," said Phil Wickizer, director of the Indiana Board of Pharmacy.

If the Steelworkers are successful in organizing Medco's facility here, it will be a first. No union pharmacists work in Central Indiana, according to the Indiana Pharmacists Alliance, a statewide trade group.

The $150 million distribution center eventually will employ 1,400 people, including hundreds of pharmacists and pharmacy technicians. Medco said it was unaware of any union discussions or organizing activity taking place, but said that employees were free to join unions if they wish, following the established legal procedure.

Call Star reporter John Russell at (317) 444-6283.



About Medco's Indiana facility

What it is: An automated pharmacy that can dispense mail-order prescription drugs across the country, using robotics and other handling equipment.

Location: AllPoints at Anson, near I-65, just west of Zionsville.

Size: 452,000 square feet.

Employees: 1,400 (when it reaches full capacity in coming months).

Average wage: $53,000.

Broke ground: 2008.

Began operating: 2010.

About the company

What: Leading pharmacy benefits manager and mail-order pharmacy operator. Last year, Medco managed 695 million prescriptions. Its mail-order business dispensed more than 103 million prescriptions.

Ticker: MHS.

Headquarters: Franklin Lakes, N.J.

Chief executive: David B. Snow Jr.

Employees: More than 15,000 nationwide, including more than 2,100 pharmacists and more than 200 nurses.

2009 revenues: $9.5 billion.

Operations: Nine mail-order pharmacies, six call center pharmacies and a partnership with a network of nearly 60,000 retail pharmacies.

Source: Medco

Note:  This article from the Indy Star was also circulated by newswire and carried by the Baltimore Sun.  It generated much commenting from readers and hits on this website too.  We asked reporter John Russell for access to this article when the web-link expired in late August 2010.  Now, this part of the Medco story will be told again and captured for posterity.  With much appreciation to John Russell and the Indy Star editors.  - Raj Bhat RPh, Tampa FL

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August 8, 2010.  How to Report Medicine Errors, Near Errors and Hazardous Conditions. Click HERE.


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August 1, 2010.  From 2003, a thorough article by Drug Topics details a long list of allegations against Medco from the Quota System to pharmacist intimidation to moving Medco operations out of Texas and Massachusetts and what happened in Tampa Florida.

August 1, 2010.  Eric Cropp is a former pharmacist who was held responsible for an infant death due to a medication dispensing error.  Although one of his pharmacy technicians filled the order, Mr Cropp was held liable and went to jail.  Here Mr Cropp is interviewed in prison by CNN.

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July 31, 2010.  This is a list of 35 staff attorneys who work for Medco, Franklin Lakes NJ.

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Code of Ethics for Pharmacists

• A pharmacist respects the covenantal relationship between the patient and pharmacist.
• A pharmacist promotes the good of every patient in a caring, compassionate, and confidential manner
• A pharmacist respects the autonomy and dignity of each patient.
• A pharmacist acts with honesty and integrity in professional relationships.
• A pharmacist maintains professional competence.
• A pharmacist respects the values and abilities of colleagues and other health professionals.
• A pharmacist serves individual, community, and societal needs.
• A pharmacist seeks justice in the distribution of health resources.

Adopted by the membership of the

American Pharmaceutical Association
October 27, 1994

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Senator Grassley (R-Iowa) Reports: Big Pharma's Payout $3 BILLION in Settlements over Past 3 Years.

Read it here: "Warpath" is the link to Senator Grassley's R-Iowa, press release about Big Pharmacies which have paid $3B in settlements over the past 3 years (2006-2009). He's on the warpath .http://www.justice.gov/usao/pae/News/Pr/2006/oct/MedcoPressReleaseUpdated10.20.06.pdf

U.S. Department of Justice
United States Attorney
Eastern District of Pennsylvania
615 Chestnut Street
Suite 1250
Philadelphia, Pennsylvania 19106-4476
(215) 861-8200

FOR IMMEDIATE RELEASE October 23, 2006
U.S. ANNOUNCES $155 MILLION SETTLEMENT OF MEDCO FALSE

CLAIMS CASE

PHILADELPHIA – United States Attorney Pat Meehan and Assistant Attorney General Peter D. Keisler today announced a $155 million settlement of fraud claims against Medco Health Solutions of Franklin Lakes, New Jersey. Medco is the second largest pharmacy benefit management company in the United States and has responsibility for managing the prescription drug benefits of over 60 million Americans, including millions of Medicare beneficiaries.

On December 9, 2003, the U.S. Attorney’s Office in the Eastern District of Pennsylvania filed an amended False Claims Act and Anti-Kickback Act complaint against Medco. That complaint charged Medco with destroying and canceling valid patient prescriptions, soliciting kickbacks from pharmaceutical manufacturers to favor their drugs, and paying kickbacks to health plans to obtain business. The complaint followed two whistle-blower actions filed in 1999 and 2000 and a four-year investigation by this office, the Offices of Inspector General of the Department of Health and Human Services, the Office of Personnel Management, and the Defense Criminal Investigative Service. The case has been pending in Federal District Court and had been scheduled for trial on June 6.

Through extensive mediation efforts with Senior Judge J. William Ditter, Jr. the parties were able to reach a resolution of the pending False Claims case against Medco. In addition, the parties reached agreement on a second False Claims Act case filed in 2003 by a former Medco employee, who alleged kickbacks by pharmaceutical manufacturers to Medco. The government and Medco also announced the resolution of a False Claims investigation that began in 2004 and which arose out of Medco’s alleged submission of claims to the Medicare program on behalf of its clients. That investigation had not yet resulted in a filing.

As a result of the settlement today, Medco will pay the United States a total of $155 million. The settlement primarily involves conduct between 1998 and 2004. In addition to paying the $155 million settlement amount, Medco was required to enter into an extensive corporate compliance agreement with the Office of Inspector General, the Department of Health and Human Services, and the Inspector General of the Office of Personnel Management, as a condition of continued participation in government health programs.

“This settlement and others like it represent a sweeping change in the way pharmacy benefit managers do business,” said Meehan, whose office reached a $137 million settlement last year with Medco’s largest competitor Caremark, which also entered into a corporate integrity agreement and a Consent Decree. Both results were achieved following six-year investigations. “Pharmacy benefit managers are ultimately accountable to their patients and these agreements increase that level of accountability. As we said at the time the complaint was filed in 2003, pressure by an employer to reduce costs and increase profits must never be allowed to coerce pharmacists into ignoring their duties to patients,” said Meehan.

In return for the $155 million payment, Medco also obtained a release of further claims against former Vice-President Diane Collins, who managed the Medco mail order pharmacy in Tampa, Florida. Collins had been charged in the complaint with destroying and instructing others to destroy valid patient prescriptions in order to cover up Medco’s failure to provide patient prescriptions on a timely basis.

“Millions of federal employees and Medicare beneficiaries rely on pharmacy benefit managers such as Medco for their prescription drugs,” said Keisler. “Hidden financial agreements between PBMs and drug manufacturers and health plans, along with the bottom line pressures of management, can influence which drugs patients receive, the price we all pay for drugs, and whether pharmacists serve patients with their undivided professional judgment.”

This financial settlement and Corporate Integrity Agreement follow an earlier negotiated Consent Decree and settlement with Medco by this office and more than 20 state Attorneys General in 2004. In that Consent Decree, in order to resolve this office’s request for an injunction under the health fraud statutes, Medco was required to make major changes in its business practices relating to soliciting drug-switching of patients, and to allow its pharmacist employees to honor their professional obligations as licensed pharmacists to patients.

“We are very proud of the work of our law enforcement team in these cases and the significant impact they will have not only because of the dollars recovered but also because of the obligation we all have to assure the integrity and success of our nation’s commitment to seniors through the Medicare prescription drug program,” said Meehan.

Meehan also acknowledged the significant contributions made by the outside law firms representing the whistleblowers in the case, who helped the law enforcement team in reviewing over 9 million pages of documents, interviewing hundreds of witnesses, and preparing briefs and arguments. “A case of this magnitude requires a huge investment of talent and time, and we greatly appreciate their work with us in bringing this case to a successful result,” he said.
This investigation was conducted by the United States Attorney’s Office, Eastern District of Pennsylvania, together with the Office of Inspector General of the Office of Personnel Management,
the Office of Inspector General of the Department of Health and Human Services, and the Defense
Criminal Investigative Service.

UNITED STATES ATTORNEY'S OFFICE Contact: Rich Manieri
EASTERN DISTRICT, PENNSYLVANIA Public Affairs
Suite 1250, 615 Chestnut Street 215-861-8525
Philadelphia, PA 19106 Jim Sheehan
Associate U.S. Attorney
215-861-8301
Jim.Sheehan@USDOJ.gov
COPIES OF NEWS MEMOS AND RELATED DOCUMENTS CAN ALSO BE FOUND AT
HTTP://WWW.USDOJ.GOV/USAO/PAE/