Laser hair Removal and Hydroquinone
Dr. Novick had a great answer. I believe that this pigmentation, rather than being ascribed to melasma alone may be a combination of melasma and post-inflammatory hyper-pigmentation. Through the years I have attended many lectures on melasma. I was curious why so many woman are plagued by an appearance of facial hair above the upper lip, when in fact they are only dealing with pigmentation. The experts I asked never had a good answer.
My hypothesis, perhaps shared by Dr. Novick, is that these women have traumatized this area by bleaching or epilating the hair. This, in turn, causes post-inflammatory hyper-pigmentation. Just a theory.
As to your problem. There is not a single solution. Laser hair removal would be fine, along with the use of a hydroquinone product. Triluma would be good as the steroid in it might help quell any inflammation from the laser process. Sunscreens are important, more so if your physician feels the pigmentation is melasma induced.
Consider laser hair removal and topical hydroquinone cream for hyperpigmentation. Depending on your skin type and hair color, some lasers are better than others. Sun exposure can increase hyperpigmentation after laser hair removal. Be careful. Best to avoid sun exposure after most laser therapies. Use sunscreen liberally and hydroquinone. Interestingly, hydroquinone can have a paradoxical effect and cause hyperpigmentation so use judiciously.
Sunscreen is the most important factor in prevention of hyperpigmentation, however, it won't reverse the existing hyperpigmentation. I would recommend using a topical bleaching cream like the SkinCeuticals Pigment Regulator to help correct the existing hyperpigmentation. As for the upper lip hair, if there is enough pigment in the follicles, I would recommend doing Laser Hair Removal.
Getting Rid of Upper Lip Hair and Dark Discoloration
Two of the most common causes of excessive blotchy facial pigmentation (essentially skin stains) are post inflammatory hyperpigmentation and melasma. Post inflammatory hyperpigmentation, as the name implies, can follow any kind of inflammation of the skin from wounds, surgery, laser treatments, infection, acne and other skin disorders. Melasma, which has a hereditary component, can arise spontaneously or be provoked by the hormones of pregnancy, birth control pills and unprotected sun exposure.
For treating both kinds of hyperpigmentation, particularly melasma, I prefer the combined use of preparations containing both hydroquinone and kojic acid. Other depigmenting agents that may prove useful include licorice extracts, arbutin, tretinoin, alpha and beta hydroxy acids. In my experience, more stubborn cases respond best to a combination of home use products containing the ingredients mentioned combined with a series of between four to six in-office, superficial alpha- or beta-hydroxy acid peels spaced at two to four week intervals. For daily sun protection I recommend Cosmedispa's Ultrablock 30 a uniquely formulated sunscreen that contains UV absorbing melanin in addition to conventional sunscreen agents.
Excessive facial hair, which is common on the upper lip mustache area, as well as on the chin and sideburns is more commonly seen in certain groups, such as in those of Mediterranean descent, and in the perimenopausal years when estrogen levels begin to fall. For permanent hair removal, especially when confined to a small area such as the upper lip I recommend the Depilar System, which consists of a series of quick in-office treatments in which, following waxing, threading or electrolysis, protein-dissolving enzymes, such as trypsin and chymotrypsin are appied to the treatment sites penetrate to the base of the hair shafts and permanently destroy the roots.
When both hyperpigmentation and excessive hair affect the same location, as in this case, I would suggest addressing the irregular pigmentation condition first and then dealing with the hair problem.
Hydroquinone before laser
I would focus on decreasing the hyperpigmentation on the lip first. Hydroquinone is the best medication to do this. It may take 3-6 months to see improvement. After the hyperpigmentation has cleared you can proceed with laser treatment for hair removal. I would continue the hydroquinone while undergoing laser treatment. Also, it is a MUST to use sunscreen with SPF 60 daily on this area.