Former Georgia Insurance Commissioner Pleads Guilty to Healthcare Fraud Scheme

John W. Oxendine, a former Georgia Insurance Commissioner, has entered a guilty plea to federal charges stemming from a conspiracy to defraud leading healthcare insurers through medically unnecessary tests. This plea was entered in federal court, where Oxendine was charged with conspiracy to commit health care fraud alongside his involvement in a deceitful operation targeting insurers like Aetna, Blue Cross Blue Shield, and United Healthcare.

The indictment details Oxendine’s role in pressuring physicians to order unwarranted pharmacogenetic, molecular genetic, and toxicology testing from Next Health, a Texas laboratory. This conspiracy was furthered by a kickback arrangement with Dr. Jeffrey Gallups’ ENT practice, promising Gallups half of the net profits for tests his practice referred to Next Health. This scheme led to nearly $700,000 in payments from insurance providers to Next Health, burdening some patients with up to $18,000 in charges for the unnecessary tests.

Federal officials reveal that the kickbacks were concealed through payments made to Oxendine’s insurance consultancy, from which he allocated funds for personal gain and to settle debts with Gallups. U.S. Attorney Ryan K. Buchanan emphasized the betrayal of public trust by Oxendine, highlighting his prior role as a state-wide insurance commissioner and his awareness of the ethical standards required in dealings between doctors and insurance companies.

Oxendine’s political career, once marked by rapid ascension and aspirations for the Georgia governorship, faces a significant setback with this indictment and his impending sentencing scheduled for July 12.