Georgia medical clinic owner gets 3 years in prison for fraud scheme

An Alpharetta, Ga.-based medical clinic owner was sentenced to three years in prison for a healthcare fraud scheme that also allegedly involves a former Georgia insurance commissioner, the Atlanta Journal-Constitution reported June 28. 

Jeffrey Gallups, MD, ordered physicians who worked at his Ear, Nose & Throat Institute clinics to require unnecessary lab tests for patients, according to the report. Dr. Gallups had a secret arrangement with Texas lab company Next Health to split the money generated by the tests. 

Dr. Gallups was ordered to pay more than $700,000 as part of his sentence and was fined $25,000, according to the report. 

Former Georgia insurance commissioner John Oxendine was the alleged middleman in the scheme, according to the report. Mr. Oxendine was working as a private attorney when he allegedly conspired to provide fraudulent insurance claims to Aetna, Blue Cross Blue Shield, UnitedHealthcare and others for medically unnecessary testing. He is facing conspiracy to commit healthcare fraud and conspiracy to commit money laundering charges. 

Dr. Gallups and his company Milton Hall Surgical Associates agreed last December to pay $3 million to settle a separate civil whistleblower lawsuit that alleged the scheme defrauded government healthcare programs, according to the report.

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