Malcolm Gladwell ponders if Miami itself is to blame for being the U.S. fraud capital

Malcolm Gladwell wanted to learn more about Medicare fraud so he came to the capital of the schemes. He came to Miami.

"Once I found out that Miami had this exalted position in this fraud category, I came to Miami to get to the bottom of it," he said.

Twenty-five years ago the celebrated author had helped popularize the concept of how fashion and social issues become trends in his book The Tipping Point.

He revisited his theories and looked at some of the darker elements of social epidemics in his new book Revenge of the Tipping Point. And in doing so, Miami found itself playing a central role thanks to schemes to rip off Medicare, the government healthcare program.

READ MORE: 'Anything Is Good': A real life fall from wealth to homelessness in Miami Beach

Gladwell knows Miami presents a compelling setting to explore his theories. And he knows it sparks a natural, shall we say, curiosity, in audiences who only know Miami by its reputation as a place with a tolerance for outrageous behavior. (See "Only in Dade" on Instagram.)

After all, the first sentence on the book flap of Revenge of the Tipping Point asks, "Why is Miami...Miami?"

WLRN's Tom Hudson hosted a conversation with Gladwell at the 2024 Miami Book Fair. The following is an edited excerpt.

WLRN: Malcolm, why is Miami, Miami?

GLADWELL: I felt like a reference to Miami's weirdness would be the right place to start.

Let's be frank here, Malcolm, that you have held up a mirror to some Miami behavior that is not all that becoming.

Yeah.

What did you find about Miami that was so intriguing as a storyteller, that was so compelling as a journalist?

I was very interested in this question of why there is so much unexplained variation in the behavior across a wide range of things from one city to the next in the United States. The way a cardiologist treats you in Buffalo is very different from the way a cardiologist would treat the exact same patient with the exact same problem in Boulder, Colorado, for example. And you can look across any number of medical procedures and you will find these crazy variations from place to place. I got interested in Miami because Miami is a great example of this crazy variation. And the thing that I focused on was Medicare fraud. This is the Medicare fraud capital of America.

Medicare fraud is a huge deal. It's the biggest kind of fraud in a category of fraud in America. Nothing else comes close. What's curious is that it's really easy to do, as I discovered. So, if it's really easy for anyone to do in the United States, then why isn't everyone doing it? Why of all the small number of people who really are doing it aggressively, is Miami far and away the leader? Once I found out that Miami had this exalted position in this fraud category, I came to Miami to kind of get to the bottom of it.

Twenty-five years ago, when you wrote Tipping Point, you chose stories about Hush Puppies, the shoes. You chose a story about Sesame Street and Blue's Clues. And 25 years go by and then you decide to feature a story about Medicare fraud in Miami.

Yeah, my vision has gotten a little darker over the last 25 years. Maybe I have a richer appreciation for the full diversity of crazy behavior in this country. You forget this because you live here, that an outsider coming to Miami is immediately struck by the fact that it doesn't bear any resemblance to any other city in the United States.

I began just by kind of diagnosing the varieties of flamboyant Medicare fraud behaviors that take place in the city, which are considerable.

There's something called the Medicare fraud task force, which is this group put together by the FBI, the DOJ and HHS. They figured out that there was one of the biggest money launderers involved in the Medicare fraud business in Miami. They were tracking him down and they realized that he was in the office upstairs from where the task force was.

So in other words, here's a guy every morning he goes to an office building in North Miami, he's literally on the 6th floor, and on the 5th floor it says Medicare Fraud Task Force. You have to put yourself inside the mind of that, of that guy. He's like... he has a certain amount of audacity.

A quarter of a century ago you introduced three key concepts around social epidemics. One of the key concepts in here, and it's the first word of the subtitle, is overstories, which is related to this idea of local area variances. It's described as the patterns of behavior attract that themselves to places in ways that can sometimes surprise us.

I tell a story in that chapter of this marvelous character named Philip Esformes, who was accused by the government of masterminding one of the largest Medicare frauds in American history. Here's a guy who came from Chicago, where his family had been a sort of upstanding citizens and had run a chain of nursing homes up there.

Then they all move en masse to Miami, and Philip Esformes very quickly becomes embroiled in some kind of questionable behavior. At his sentencing hearing, his rabbi shows up, and his rabbi says, “He was an honest man in Chicago. It wasn't until he came to Miami that he became a crook. Maybe Miami is to blame."

And I chose in the chapter to take that seriously. I do think there's something to that, that there is something about the ethos of a community. that has an impact on us in a way that we may not realize.

When I was reading this in the book, what I was thinking about is, who among us takes our Publix shopping cart back to the shopping cart corral?

This is a good example of a community norm. If you ask that same question in Minneapolis, everyone would. And you do it because everyone else is doing it. There is a point — a tipping point — when you no longer feel any kind of social pressure to adhere to that particular norm.

I was talking about this recently at an event in Broward County.

A whole different story.

When you're driving in Broward County, you never turn off your turn signal. And when you're driving in Dade County, you never turn it on. So, there's a bright line there, of a cultural norm. So, this individual is from Dade County, but we had this conversation in Broward. I was talking about this idea of the overstory. This is a long-time community civic business leader, and he said, “Dade County is a community of risk takers or descendants of risk takers historically.” So perhaps that risk appetite, is materially different in this community.

Yeah, I think those kinds of observations are really useful. They're not definitive, right?They don't explain behavior on the individual level fully, but they're really useful in understanding that there are these enormous differences in behavior from one group to the next.

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