Jim Beck, a former employee of the Georgia Underwriting Association, is currently serving a prison sentence of more than seven years after being convicted in 2021 for embezzling over $2 million. The money was allegedly used to fund Beck’s successful political campaign in 2018.
Former insurance commissioner John Oxendine, who served for 16 years before running for the Republican nomination for governor in 2010, has expressed disagreement with the requested prison sentence for Beck, stating that he was merely a middleman in a scheme orchestrated by Alpharetta doctor Jeffrey Gallups. Gallups was sentenced to three years in prison, ordered to pay over $700,000 in restitution, and fined $25,000 in June 2022 for submitting fraudulent insurance claims.
Oxendine argued in court that he should not be required to pay more than Gallups, as both individuals did not make or lose significantly more money through the scheme. The scheme, intended to net $3 million, resulted in a loss to insurance companies of $760,454. Oxendine claimed that he should receive a lesser prison sentence due to his good character, as evidenced by 59 support letters from former insurance commissioners, former U.S. Rep. Bob Barr, Fulton County Superior Court Judge Craig Schwall, and pastor Johnny Hunt, among others.
Prosecutors, however, accused Oxendine of helping Gallups defraud health care insurance providers and receiving tens of thousands of dollars in kickbacks. The arrangement between 2015 and 2017 involved fraudulent insurance claims for medically unnecessary genetic and toxicology testing by Texas lab company NextHealth. Oxendine allegedly used his legal expertise to broker the illegal kickback agreement between NextHealth and Gallups.
Gallups ordered doctors at his Ear, Nose & Throat Institute clinics to require unnecessary lab tests for patients. He arranged with NextHealth to split the money generated by the tests, for which some patients were billed as much as $18,000. Oxendine received the hundreds of thousands of dollars in kickbacks that the lab company gave Gallups. He kept more than $40,000 and used the rest of the money to pay the doctor’s debts and charitable donations, prosecutors alleged.
Oxendine was indicted in May 2022 and pleaded not guilty. He was due to stand trial in April on single counts of conspiracy to commit health care fraud and conspiracy to commit money laundering. However, prosecutors agreed to dismiss the money laundering charge under the plea deal. Gallups and his company, Milton Hall Surgical Associates, agreed to pay over $3 million to settle a related civil case, with the settlement amount increasing to $5.3 million due to late payments.
In a separate civil fraud case in Texas, NextHealth and associates were ordered to pay over $218 million in June 2023. Oxendine has also faced accusations of campaign finance mismanagement, settling the last of these cases with Georgia’s ethics commission in exchange for about $128,000 in donor money in May 2022.
