State Clears Kaiser in Ongoing Probe of HMO Drug Listings

A state investigation of a leading HMO found no proof the company improperly removed drugs from its formulary, but similar probes of five other insurers continue, officials said.

The state Department of Corporations notified Oakland-based Kaiser Foundation Health Plan that the “information reviewed, including the large amount of information provided by the plan [Kaiser], does not support the allegations,” the department said this week.

The investigation was prompted in part by two lawmakers’ complaints that some health maintenance organizations improperly removed drugs from their approved lists, or formularies, that define which drugs are covered by a patient’s health plan.

Assemblyman Martin Gallegos (D-Baldwin Park) and state Sen. Jackie Speier (D-Daly City) sought a state review of the drug formularies after patients complained that expensive drugs were listed and then abruptly withdrawn in a “bait-and-switch” move after new enrollees joined.

Kaiser spokesman Tom Debley said his company worked closely with investigators.

“We are very pleased that they have affirmed what we strongly believed--that our formulary system is physician-run and that it is a good system,” Debley said.

The Corporations Department’s announcement followed six months of review targeting a half-dozen HMOs.

The case is closed on Kaiser, but drug formulary investigations continue for five other HMOs--Aetna U.S. Health Care of California, Health Net, Key Health Plan Inc., Molina Medical Center and United Health Care of California Inc.

Together, the five HMOs have about 3.7 million enrollees.