Former insurance commissioner pleads guilty in health fraud case

Former Georgia Insurance Commissioner John W. Oxendine on Friday pleaded guilty to conspiracy to commit health care fraud and agreed to pay $699,864 in restitution to health insurers in connection with an alleged money laundering scheme.

Mr. Oxendine, of Johns Creek, Georgia, entered the guilty plea in the U.S. District Court for the Northern District of Georgia in Atlanta. He faces a maximum penalty of 10 years in prison but is likely to be sentenced to less based on guidelines outlined in the plea agreement, according to news reports.

As part of the plea deal, prosecutors agreed to dismiss the money laundering charge.

“John Oxendine, as the former state-wide insurance commissioner, knew the importance of honest dealings between doctors and insurance companies,” Ryan K. Buchanan, U.S. Attorney for the Northern District of Georgia, said Friday in a statement. “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.”

Mr. Oxendine is set to be sentenced July 12 before U.S. District Judge Steve C. Jones.

A federal grand jury indicted Mr. Oxendine in 2022 on charges of health care fraud and money laundering.

The conduct alleged in the indictment occurred after Mr. Oxendine’s 16-year tenure as insurance and safety fire commissioner ended in 2011.

Prosecutors said Mr. Oxendine conspired with Dr. Jeffrey Gallups, an Alpharetta, Georgia-based ear, nose and throat doctor, and others to submit $2.5 million in fraudulent insurance claims for medically unnecessary lab tests in exchange for kickbacks.

Dr. Gallups was sentenced to three years in prison for his part in the scheme in 2022.