Former Georgia Insurance Commissioner pleads guilty to fraud
ATLANTA, Ga. (WDEF) — Former Georgia State Insurance Commissioner, John W. Oxendine pleaded guilty to a health care fraud scheme, according to the U.S. Department of Justice.
It said Oxendine pleaded guilty to conspiracy to commit health care fraud.
The DOJ said Oxendine and a co-conspirator referred “unnecessary” medical tests to a lab in Texas. In return, they received hundreds of thousands of dollars in kickbacks.
“John Oxendine, as the former state-wide insurance commissioner, knew the importance of honest dealings between doctors and insurance companies,” said U.S. Attorney Ryan K. Buchanan. “But for personal profit he willfully conspired with a physician to order hundreds of unnecessary lab tests, costing hundreds of thousands of dollars. He will now be held accountable for violating the public’s trust.”
Oxendine and Dr. Jeffrey Gallups submitted medically unnecessary “Pharmacogenetic, Molecular Genetic and Toxicology testing,” according to the DOJ. The lab they sent these tests to, Next Health, then agreed to pay Oxendine and Dr. Gallups’ practice 50% of net profit.
The DOJ said Oxendine also pressured doctors in Dr. Gallups’ practice to order these tests in a presentation at the Ritz Carlton.
The DOJ described what happened after submitting these tests:
“Next Health later submitted insurance claims seeking more than $2,500,000 in payments from private health insurers for the unnecessary tests. The insurance companies paid almost $700,000 to Next Health because of these fraudulent claims. Next Health then paid $260,000 in kickbacks to Oxendine and Dr. Gallups. Some patients were also charged for the tests, receiving bills of up to $18,000.”
Additionally, the DOJ said Oxendine directed Gallups to lie about the payments to federal agents.
In this case, “United States v. Gallups,” the DOJ said Dr. Gallups pleaded guilty to health care fraud as well.
U.S. District Judge Steve C. Jones will sentence 61-year-old Oxendine on July 12 at 10 a.m.
