The Mirzoyan-Terdjanian Organization: Networking Components of a Successful Fraud Scheme

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Abstract

Since its’ 1960 inception, Medicaid and other healthcare programs have been characterized by attempts to defraud and abuse the medical system. According to Krause (2010), the United States was estimated to have spent over $2 trillion on health care in 2009. Under some estimates, up to 10 percent of this $2 trillion investment was lost to fraud. In 2010, a multifarious, highly organized Medicaid fraud scheme was uncovered in the United States. The culprits: the Mirzoyan-Terdjanian Organization. Through the creation of at least 118 fraudulent clinics in 25 different states, the organization was able to defraud Medicaid out of more than $100 million. Given the recurrent trend of healthcare fraud in the U.S., several research questions guide the present research: Why has our Medicaid system been subject to such widespread abuse? Why was the Mirzoyan-Terdjanian Organization so successful in their scheme? In order to understand the success of any fraud scheme, one must first understand the compositional organization of those involved. To this end, social network analysis will be used to describe the Mirzoyan-Terdjanian Organizational network. Given an understanding of one criminal network could provide a solid foundation upon which future policy can be built.

Author

• Travis John Meyers, Arizona State University