Trial date set for John Oxendine, former insurance commissioner charged with health care fraud and money laundering 

Despite his efforts to have the charges dismissed, a federal judge has upheld the charges against former Georgia insurance commissioner John Oxendine. His federal trial, concerning charges of conspiracy to commit health care fraud and money laundering, is scheduled for April 15th.

The one-time gubernatorial candidate pleaded not guilty to the charges when indicted in May 2022. He is currently free on a $100,000 signature bond.

Oxendine served as insurance commissioner for 16 years before an unsuccessful bid for the Republican nomination for governor in 2010. Prosecutors allege that Oxendine participated in a scheme with an Alpharetta doctor to defraud health care insurance providers by submitting fraudulent insurance claims for medically unnecessary genetic and toxicology testing conducted by Texas lab company Next Health.

The arrangement, which took place between 2015 and 2017, involved kickbacks to Oxendine totaling hundreds of thousands of dollars. These funds were allegedly funneled through Oxendine’s now-defunct business, International Medical Research, with Oxendine keeping over $40,000 for himself and using the remainder to pay off the doctor’s debts and make charitable donations.

Prosecutors further allege that Oxendine pressured doctors at Gallups’, a chain of Atlanta-area medical clinics, to order the fraudulent lab tests during a speech at a Buckhead hotel in September 2015. The insurance claims submitted by Next Health as a result of these tests totaled over $2.5 million, with more than $600,000 received from insurance companies. 

For his role in the scheme, Jeffrey Gallups, the doctor who owned the clinics, was sentenced to three years in prison in June 2022 after he pleaded guilty to submitting fraudulent insurance claims. In addition to his sentence, he was ordered to pay restitution and fines. In a related civil case, Gallups agreed to a multimillion-dollar settlement to resolve allegations of defrauding government healthcare programs.

 Additionally, Next Health and its associates were ordered to pay over $218 million in a separate civil fraud lawsuit filed by UnitedHealthcare in Texas federal court.

Apart from the health care fraud charges, Oxendine has faced accusations of campaign finance mismanagement. In May 2022, Georgia’s ethics commission settled multiple cases against him in exchange for approximately $128,000 in donor money. Oxendine’s case marks the second instance of a former Georgia insurance commissioner facing criminal charges in recent years, with Jim Beck currently serving a prison sentence for embezzling funds from his former employer.