On Friday, a federal court sentenced former Georgia Insurance Commissioner John Oxendine to three and a half years in prison after he pleaded guilty to conspiracy to conduct health care fraud.
U.S. District Judge Steve Jones had one question for the 62-year-old Republican, who was elected four times before running unsuccessfully for governor:
“Why?”
Oxendine only received $40,000 from the conspiracy, according to Jones, but he was sentenced to pay a $25,000 fine and split $760,000 in restitution with Dr. Jeffrey Gallups, who pled guilty to health care fraud before being arrested.
Oxendine said that he is “too much of a pleaser” and is trying to make his client Gallups happy.
That means Oxendine stepped up in front of Gallup-employed physicians at a September 2015 gathering at a Ritz-Carlton hotel in Atlanta and asked them to perform unneeded medical tests on patients and charge insurance, Oxendine alleged.
It also meant Oxendine created a scheme to collect $260,000 in bribes from medical testing business Next Health via his consulting firm, with the majority of the money going to Gallups, according to prosecutors. According to prosecutors, Oxendine made a charity donation of $150,000 and paid $70,000 in attorney’s costs on Gallups’ behalf.
Oxendine said that his legally blind father had served as a Gwinnett County judge. However, Oxendine claimed that he had breached his own duty as a lawyer.
“I chose to be blind, but it was my own doing,” Oxendine told the court. “I simply sat there and shut my eyes. I was unaware of the ramifications of my conduct, including how other people might suffer.
Defense counsel Drew Findling requested Jones to limit Oxendine’s sentence to two and a half years, rather than the three years and eight months sought by prosecutors. Findling claimed that Oxendine should not spend longer time than Gallups, who was sentenced to three years in 2021. Gallups is now requesting that his jail sentence be lowered since he created secret recordings as evidence against Oxendine.
About 60 individuals sent letters pleading for Oxendine’s clemency, including family members, attorneys, former U.S. Rep. Bob Barr, and insurance commissioners from neighboring states.
“I know John regrets the choices he made,” his wife, Ivy Oxendine, told Jones through tears. “It was his decisions that led him here today. He has expressed regret to me and his children.
However, prosecutors claim Oxendine exploited his position as an attorney and his political “sway” from four stints as insurance commissioner to perpetrate fraud.
“He should have stopped the scheme instead of designing it,” said Assistant United States Attorney Christopher Huber. “He should have reported the kickbacks instead of collecting them.”
Huber pointed out that the plan harmed both insurers and patients, including one who received a $18,000 charge.
Prosecutors claim Oxendine directed Gallups to fraudulently inform a compliance officer at Gallups’ firm that Oxendine’s payments were loans. When questioned by federal authorities, Oxendine urged Gallups to repeat the falsehood, according to prosecutors. They further claimed that during an interview with The Atlanta Journal-Constitution, Oxendine falsely said that he did not receive money from Next Health.
Jones said Oxendine broke his campaign promise to work for the “little guy.”
“In this situation, you weren’t helping the little guy,” the judge stated. “You were hurting the little guy.”
Jones did show some compassion, reducing the prosecution’ sought $700,000 fine to $25,000. And, when Huber informed Jones that Gallups had paid $197 of the $760,000 in split restitution, Jones promised Gallups that his contributions would be scrutinized. On Friday, Oxendine made a first $100,000 payment toward the total.
Gallups also owes $5.4 million after a whistleblower filed a complaint alleging that Gallups misled the federal government via the Next Health scam and a kickback conspiracy with another medical equipment firm.
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Oxendine campaigned for governor in 2010, but he lost the Republican primary. The Georgia Ethics Commission started investigating campaign finance crimes in 2009, charging that Oxendine improperly used campaign cash to purchase a home, lease expensive automobiles, and join a private club.
Oxendine resolved the lawsuit with the commission in 2022, agreeing to pay up the remaining $128,000 in his campaign money but denying any wrongdoing.
He was also accused of collecting a $120,000 bundled donation from two Georgia insurance firms while campaigning for governor, which is ten times the legal limit. A court found that state authorities took too long to prosecute Oxendine on those allegations.