GREENEVILLE, Tenn. (WJHL) — Kingsport physician Dr. Scott McLain has entered an agreement with federal prosecutors, pleading guilty to two felony counts that each carry a maximum prison sentence of five years.

The agreement, which McLain signed Sept. 3, includes guilty pleas to a count of “false statements relating to health care matters” and another count of knowingly distributing a controlled substance (Xanax) without a legitimate medical purpose.

McLain also faces a negotiated monetary forfeiture of up to $90,000. Both counts also include the possibility of fines up to $250,000 and supervised release of up to one year in the false statements count and one year in the prescribing count.

McLain, who was arrested July 1, was initially charged with two drug distribution counts and a health care fraud count after what authorities described as a multi-year investigation. Two counts were dropped in the plea agreement.

As part of the false statements plea, McLain admitted to facts including that between at least late 2022 and mid-2024, he overbilled insurance companies, inflating the number of hours he provided services. In one case, McLain billed United Healthcare and Blue Cross Blue Shield for a combined 26.3 hours of time in one day.

That count’s stipulations also included reference to McLain being indicted for theft relating to his operation of a previous medical clinic in Knoxville. That case was settled in 2018, with McLain repaying TennCare $200,000 and agreeing to enroll in “a course on accurate coding and billing.”

“As such, by 2022, defendant was fully aware and knowledgeable about proper and accurate coding and billing when seeking reimbursement for claims for health care services submitted to health care benefit programs,” the agreement states.

On the drug distribution count, McLain admitted to prescribing Xanax to his fiancée over several months of early 2025 in violation of the Tennessee Board of Medical Examiners’ rules. McLain admitted to a series of facts surrounding large amounts of the drug that he prescribed to his fiancée.

The stipulations also include an admission that in November 2024, “investigating agents specifically warned defendant that he could not prescribe drugs to individuals with whom he was in an intimate relationship (the reference at that time was to another live-in girlfriend).”

A sentencing date has not been set.