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Private Equity Is Cashing in on Autism Therapy. Children Are Paying the Price

Analysis of Medicaid data finds applied behavior analysis 鈥 an unproven, even dangerous therapy 鈥 turns huge profits for providers at kids' expense

By Beth Hawkins & Nicholas Perez | September 15, 2026
Eamonn Fitzmaurice/社区黑料

In February, on orders from the U.S. Department of Government Efficiency, Medicaid officials created a first-of-its-kind online portal containing hundreds of millions of billing records that supposedly would allow everyday people to crowdsource investigations into healthcare fraud.

“DOGE is not a department,鈥 Elon Musk . 鈥淚t’s a state of mind.”

At the time, thousands of heavily armed federal agents were smashing into cars and battering their way into homes throughout Minnesota鈥檚 Twin Cities, under the guise of investigating what the Trump administration insisted was unchecked fraud in autism therapy committed by Somali immigrants.

There was a grain of truth: Fraud is indeed widespread in autism therapy, something a series of federal audits begun during the Biden administration found in red states and blue. In the wake of the audits鈥 release, the Trump administration raided autism centers, blaming lawless immigrants, welfare cheats and 鈥渨oke ideology鈥 for the scandals unfolding nationwide. 

But a 74 investigation found another problem entirely: a massive influx of private equity players capitalizing on the autism therapy industry to the tune of $7 billion in taxpayer-funded Medicaid payments over the course of six years. And much of this explosive growth has come at the expense of children.

The explosive growth of applied behavior analysis

社区黑料 downloaded the 275 million-record DOGE dataset and analyzed Medicaid claims for autism therapy from 2019 to 2024. Our analysis reveals how an unproven, even harmful, behavior modification system called applied behavior analysis, or ABA, is crowding out more effective 鈥 and humane 鈥 treatments for children with autism.

And it shows how a well-intentioned campaign by parents desperate to find a “cure” for their autistic kids has mushroomed into a poorly implemented but extremely lucrative mechanism for providing ABA 鈥 a system of rewards and punishments designed to eliminate certain behaviors 鈥 to as many autistic children as possible, regardless of their age or actual needs. 

Pediatricians, psychologists and other professionals who diagnose autism reflexively prescribe ABA to parents, typically unaware that there is mounting disagreement about the therapy鈥檚 effectiveness and the associated trauma that can follow an autistic individual into adulthood. Told this is the child鈥檚 best chance at a decent life, few caregivers question the guidance until harmful effects start to show.

Experts consulted by 社区黑料 weren鈥檛 surprised by our findings. Health officials turned on the fiscal taps before instituting meaningful legal oversight 鈥 creating the exact kind of loosely regulated environment that draws the opaque investment strategy employed by private equity. 

A secretive corner of the financial sector not held to the same standards as exchange-traded stocks, bank loans and other publicly monitored investments, private equity has acquired businesses in numerous industries over the last decade, hoovering up billions of dollars. 

Private equity typically acquires privately held companies that have access to steady streams of revenue, extracting as much cash as possible in the short term and leaving debt when investors move on. To maximize profits, they often deliver the easiest, most lucrative services, rather than the personalized treatments Medicaid and other public funds were supposed to pay for.

From 2019 to 2024, 社区黑料 found, Medicaid claims for the six most common autism therapy billing codes shot up some 381%, from $400 million a year to nearly $2 billion 鈥 with private equity-backed providers leading the billing pack.

Indeed, federal begun in 2022 鈥 two of them in blue states and two in red 鈥 reveal a very purple problem. They detail how bad actors in the for-profit business sector, whether greedy or merely inept, push autistic children toward ABA therapy at the expense of other, more effective supports at school that students with disabilities are guaranteed by law. 

Families whose children are referred to ABA by pediatricians and other providers are typically urged by private therapy centers to sign them up for as many hours as possible 鈥 up to 40 hours a week 鈥 and to keep them there for years. That is a prescription ripe for exploitation, says Ari Ne鈥橢man, an assistant professor of health policy and management at Harvard’s T.H. Chan School of Public Health and former director of the Autistic Self-Advocacy Network.  

鈥淧rivate equity was attracted to ABA because the industry as a whole had set up a very tidy financial arrangement for itself,鈥 says Ne鈥橢man. 鈥淚t鈥檚 not that private equity is corrupting a previously fine field. Private equity entered the field because of the flaws that were already there.鈥 

For fiscal year 2026, federal spending on special education . If the $2 billion now being spent every year on ABA for children with publicly subsidized health insurance were added to schools鈥 annual budgets, every district in the country could add one full-time and one half-time occupational therapist 鈥 specialists in desperate short supply who have proven success in addressing many issues facing autistic children.

鈥淚t鈥檚 not that private equity is corrupting a previously fine field. Private equity entered the field because of the flaws that were already there.鈥

Ari Ne鈥橢man, T.H. Chan School of Public Health

DOGE鈥檚 intentions notwithstanding, many in the autism community have hoped the crisis posed by runaway Medicaid spending might present an opportunity to take a hard look at how ABA has grown into an industry with the fiscal might to stave off even basic state and federal oversight. And how it is crowding out more effective, humane alternatives, and even preventing children from going to school.

Instead, now they fear that politics will further overshadow needed autism therapy reforms. The second Trump administration has withheld some $3 billion in Medicaid funding from California and Minnesota, insisting that their governors 鈥 whom the president views as foes 鈥 are not attending to fraud. As a consequence, people with disabilities have already lost services. 

As the Medicaid cuts in Trump鈥檚 One Big Beautiful Bill go into effect, and as he and Health and Human Services Secretary Robert F. Kennedy Jr. continue to promote disproven and dangerous 鈥cures鈥 for autism 鈥 at the cost of research into better treatments 鈥 disability advocates fear the future will look a lot like a dark past.   

ABA claims vastly outpace spending on autistic people鈥檚 quality of life

In addition to the financial boondoggles, there鈥檚 a human cost. 

During the six years of records we analyzed, Medicaid billing for ABA therapy totaled nearly $7 billion. That鈥檚 $1 billion more than the United States has spent in 20 years on research and programs under the Autism CARES Act, which pays for services to better autistic people鈥檚 lives.   

As disproportionately small as the CARES Act funding is, even after two decades of lobbying by autists and advocates, very little of it is spent on . Of the $2 billion appropriated last year, to be spent over five years, $30 million will go to creating support for caregivers, $13 million to job training and $19 million to safety and well-being.    

Now, even that modest pot of funding is imperiled, as Kennedy is redirecting federal resources toward new research on vaccines and other long-discredited 鈥渃auses鈥 of autism and dangerous, ineffective treatment strategies. 

Meanwhile, is that the most widely used therapy, ABA, is frequently ineffective and . The therapy was pioneered in the 1960s by Norwegian-born UCLA researcher Ole Ivar Lovaas, who used the same regime of rewards and punishments to develop LGBTQ conversion therapy 鈥 now widely acknowledged as abusive.

Independent researchers and autistic adults who went through ABA say its focus on 鈥渆xtinguishing鈥 natural and frequently beneficial autistic traits and in their place demanding compliance with 鈥渘ormal鈥 behaviors is traumatizing. Much as conversion therapy can鈥檛 change a person鈥檚 identity but can instead instill shame, behavior conditioning will not make autists nondisabled and sends the message their strengths are unimportant.

Lovaas is one of two early autism researchers whose histories are now known to include ties to Nazi Germany. In interviews, Lovaas said that during the five-year German occupation of Norway, he and his family were forced to labor on farms. But a 2025 report in the journal History of the Human Sciences documents his role as a local of Norway鈥檚 Nazi youth movement. The Third Reich sought to 鈥euthanize鈥 autistic people, who were seen as a financial and genetic burden to society.  

The other autism researcher who played a role in the Nazis’ eugenics campaigns was Dr. Hans Asperger, who reported of 鈥渕alformed children鈥 to be targeted for sterilization or death. 

Proponents are quick to assert that today鈥檚 ABA is a far cry from the slaps and electric shocks of what was known as the Lovaas Method early on. Yet the goal 鈥 to 鈥渆xtinguish鈥 autistic traits in children鈥 typically remains. Kids as young as 2 are routinely subjected to as many as 40 hours a week of repetitive behavior modification drills.   

A past 74 investigation found that for years, the evidence used to legitimize ABA was produced by the industry itself, was rife with undisclosed conflicts of interest and neglected basic guardrails such as documentation of harmful 鈥渁dverse events.鈥 By contrast, independent research into ABA by the and academic scholars found little to no evidence of effectiveness.

A of 460 autistic adults and caregivers of autistic children found that nearly half of those who went through ABA showed symptoms of post-traumatic stress, while 72% of those who did not participate in the therapy were asymptomatic.   

, researchers at the University of Wisconsin-Madison, Ohio State University and the University of Texas at Austin found that people who had participated in ABA before age 18 were 30% more likely to experience a mental health hospitalization than autistic people who had not. Autistic people who had been treated with ABA and hospitalized were also admitted with 32% greater frequency than those who had not.   

Again, says Ne鈥橢man, the industry is predicated on a flawed, but very profitable, model. ABA industry recommendations call for every child, regardless of how young they are or what their needs are, to receive the same intensity of treatment.     

鈥淚 would argue that ABA is potentially harmful in any situation because we haven鈥檛 really addressed the ethical concerns of the potential mental health consequences,鈥 says Ne鈥橢man. 鈥淏ut even if we were to set that aside, the idea that there is an evidence base for applying ABA in all instances without regard to any consideration for age or the types of challenges that someone has, it鈥檚 just ludicrous.鈥

鈥淔orty hours a week of therapy is a full-time job for a 3-year-old,鈥 says Ne鈥橢man. 鈥淚t鈥檚 harmful for kids and families first and foremost, but I also think it鈥檚 a poor use of public funds.鈥 

When therapy supplants school

The four federal audits of state Medicaid spending show what advocates have long decried: ABA service providers are allowed to keep children in lucrative standalone treatment centers where they are barred by Medicaid law from receiving academic instruction 鈥 often for years after they should begin attending school.

The audit of claims records from Colorado 鈥 which included anonymized information on individual children鈥檚 hourly activities 鈥斕齠ound that some school-aged kids remained in ABA centers full time. Since it is illegal for therapists to teach children in their care to read or write, the kids were denied a proper education.

The audit found one Colorado child, referred for ABA in 2009 at the age of 2, who continued receiving six or more hours of treatment five days a week until age 16 鈥 without any independent evaluation that ABA treatment was still appropriate.

Medicaid began paying for the child鈥檚 therapy in 2019. Over the next six years, payments for the child鈥檚 treatment increased from more than $16,000 a year in 2019…

to more than $144,000 in 2024, for a total of $518,700.

Auditors raised similar concerns in Indiana, flagging the case of a child who was referred to ABA in January 2014 at the age of 2 and was still receiving more than seven hours of therapy a day, five days a week, at age 8 鈥 years after they should have been in school. Medicaid payments for this child increased from $52,000 a year in 2017 to more than $185,000 in 2022, when the child was 11, for a total of $677,448. 

(For perspective, state spending on school-based special education services varies wildly and is poorly reported. One often-used estimate is that an average of $26,000 is spent annually on each student with a disability, versus $9,000 per non-disabled pupil.)     

Special education teachers say that when these students show up in a classroom, it鈥檚 after years of lost academic instruction. In practice, often this means they will be denied the chance to learn alongside their typically developing peers 鈥 a right enshrined in federal law. 

鈥淔orty hours a week of therapy is a full-time job for a 3-year-old. It鈥檚 harmful for kids and families first and foremost, but I also think it鈥檚 a poor use of public funds.鈥 

Ari Ne鈥橢man, T.H. Chan School of Public Health

Advocates say the exact number of children in this position is probably unknowable. As a youngster approaches kindergarten age, families are often warned by their ABA provider that taking their child out of private therapy and enrolling them in school will cause regression. Much as homeschoolers often do, these families can sign official documents saying they are taking responsibility for their child鈥檚 education.    

In the case of the Indiana youngster, now 11, auditors noted that the treatment plan did not say whether the child attended school, 鈥渂ut had a standardized statement: 鈥楾he patient鈥檚 family [has] taken on responsibility for meeting the educational needs of this patient.鈥 鈥 

After the audit, Indiana lawmakers on how much therapy centers could bill per child, and for how much time. Many children have reached or are near reaching the cap.  

A state task force appointed to address issues likely to follow the changes repeatedly heard from parents and advocates concerned about older children who, no longer eligible for Medicaid-funded ABA, would attend school for the first time. As a result, a new law allows private ABA therapists to accompany children to class for a transition period. 

How did the ABA industry get so big?

For the first 20 years after Lovaas announced he had 鈥渞ecovered鈥 鈥 his term for cured 鈥 nine of 19 autistic children on whom he had developed ABA, the supposed miracle cure was inaccessible to almost all families. Insurers were not required to cover the diagnosis or treatment of autism.

Then, in 2005, the mother of a 4-year-old autistic boy sat down at her kitchen table and drafted a bill to require health insurers in South Carolina to cover the 鈥済old standard鈥 therapy being touted as a child鈥檚 best shot at a 鈥渘ormal鈥 life. Then she enlisted hundreds of parents of autistic children to lobby state lawmakers to pass it. 

was compelling. To afford ABA, then costing $70,000 a year, she and her husband had downsized their house and spent their home equity 鈥 plus her entire salary as a law professor 鈥 on therapy for their son, Ryan. 

The grassroots push paid off. In 2007, despite ferocious insurance industry opposition, the South Carolina legislature approved the bill 鈥 only to have the governor veto it, with just one day left in the session. 

Unumb put out another call. Accompanied by a CNN camera crew, an army of parents flooded the statehouse, demanding a veto override. 

When the vote was cast, Unumb , the lawmakers on the floor turned toward the families in the gallery and gave them a standing ovation.    

Weeks later, Unumb held a summit to teach other parents, who flew in from around the country, how she had succeeded in getting what鈥檚 known as Ryan鈥檚 Law passed. She spent the next decade working with Autism Speaks, helping to organize families in other states.

The parents had potent lobbying partners. To convince insurers that ABA was not experimental, a growing community of practitioners created an organization, the Behavior Analyst Certification Board, that set standards, bestowed credentials and promoted research. 

The board did not respond to a request for comment.  

Few questioned whether there was an inherent conflict of interest in an industry creating its own proof points. Most people were more focused on the plight of families 鈥 and the promise heralded by a miraculous, if frightfully expensive, cure. By 2019, every state required most private insurers to pay for autism services, though with wildly differing benefit levels. 

The bigger turning point occurred in 2014, when the Obama administration clarified that the Affordable Care Act required publicly subsidized care plans, including Medicaid, to pay for autism treatment. 

At the same time, the rate at which children were identified as autistic began rising dramatically. The ACA for the first time required insurers to pay for autism assessments, and improvements to diagnostic criteria helped to identify autistic children whose traits were previously missed. 

An analysis of special education Child Count data shows that between 2011 and 2022, autism鈥檚 prevalence rose from 2.3 to 6.3 per 1,000 children, with the greatest increases among those aged 5 to 8 years.

Today, Unumb is the CEO of the Council of Autism Service Providers. The organization, she wrote in an email to 社区黑料, 鈥渂elieves ABA providers must continuously earn the public鈥檚 trust in caring for children with autism. Genuine fraud, waste and abuse must be called out and punished to uphold accountability and patient safety.鈥

鈥淏ad actors exist in every healthcare profession, including ABA, but that doesn鈥檛 mean they are prevalent,鈥 she added. 鈥淭housands of qualified, ethical ABA providers are at work every day, doing the right thing and making a difference in children鈥檚 lives.鈥

Private equity enters the picture 

Private equity funds are groups of investors who pool their money to buy ownership stakes in privately held companies or real estate. These firms and their deals are subject to far less government oversight than public companies that trade on the stock market. They rarely disclose information about their activity. 

They typically have managers, who make decisions about the businesses they acquire but don鈥檛 put much of their own money into the investments. Frequently, the goal is to simultaneously cut costs and increase revenue to create a cash flow for the investors. The businesses are usually resold within three to five years. 

Over the last two decades, private equity has become increasingly common in healthcare, even though the acquisition of doctor鈥檚 practices, hospitals, medical equipment manufacturers and nursing homes can . In terms of public oversight, though, all those industries are tightly regulated compared to ABA. 

The mandates for insurance coverage of autism were instituted with very little initial oversight of the quality of services being provided. States that did require providers to be licensed often simply decided to recognize the ABA industry鈥檚 internal credentials.

While these standards are often stricter than a provider鈥檚 hiring requirements, the practice of adopting industry credentials leaves behavior analysts in charge of overseeing their own members. When, in the wake of a scathing federal audit of its Medicaid billing practices, Colorado recently moved to license therapists, it rejected a suggestion that a newly created oversight board contain outside professionals such as psychologists. Instead, the board will be composed of four therapists and one public member, who can also have industry ties. 

The combination of lax standards and ready cash proved irresistible to private equity firms, which began buying ABA practices and consolidating them into large, multi-state chains. From 2015 to 2024, private equity firms acquired 574 sites run by 147 providers, according to researchers from the Brown University School of Public Health.

Of the 50 largest providers by Medicaid billing in 社区黑料鈥檚 dataset, 23 are (or, in two cases, were) owned by private equity. From 2019 to 2024, their claims totaled $2 billion. 

Private equity firms own 11 of the top 15, with claims totaling more than $1.5 billion between 2019 and 2024. 

The process has dramatically reshaped an industry already in need of reform 鈥 in the wrong direction. 

鈥淭hey have created massive national chains with the primary purpose of extracting high returns in a short period of time,鈥 write the authors of 鈥,鈥 a report from the Center for Economic and Policy Research. 鈥淐onsolidation gives private equity-owned provider organizations a large competitive advantage over other for-profit and nonprofit providers, as well those offering other approaches to [autism] services.鈥

鈥淚t also gives them more bargaining power to negotiate higher rates for themselves vis-脿-vis state agencies, regulators and insurance payers. Some PE firms have used this leverage to extract higher reimbursements under threat of closing down sites in states in which they do not get the rates they prefer.鈥

Many of the large networks also advertise immediate openings for autism assessments, which they tout as a quick path to enrolling in therapy. Otherwise, according to the National Institutes for Health, the median time a family spends on a wait list for an independent evaluation is a year and a half. 

How private equity works

Some private equity funds take a partial ownership stake in a business that needs cash to expand or improve. But most of those investing in autism therapy are typically buyout funds, which acquire and consolidate existing businesses.

These funds’ managers invest very little of their own money, maybe 1% or 2% of the total. Investors, which often include pension funds and other institutions, put in another 30% to 50%. The rest of the cost of the acquisition is borrowed 鈥 what鈥檚 referred to as a leveraged buyout.

To make these transactions, a fund sets up a series of companies. Responsibility for the debt is transferred to the company being acquired. 

As the purchased company struggles to make the loan payments, a share of the cash coming in is returned to the investors. Sometimes, the fund managers take out loans on the already indebted business and give the cash to their investors as a dividend.   

Meanwhile, the leaders of the investment fund 鈥 whose expertise is typically in maximizing profits 鈥 are allowed to make decisions about staffing, levels of patient care, who they will serve and where. 

ABA is supposed to be highly individualized, with therapists continually collecting data on children鈥檚 responses to repeated efforts to get them to stop behaviors deemed undesirable, such as hand-flapping or rocking, or to perform actions the therapist wants, like making eye contact. 

This information, gathered by the lowest-rung member of the ABA team, a behavior technician, is supposed to be reviewed by a credentialed provider known as a board-certified behavior analyst, who uses it to modify the child鈥檚 treatment plan on a regular basis.       

But in state audits, federal investigators found repeated instances where the therapists鈥 notes submitted as claims documentation had been copied and pasted, often day after day, bearing the names of numerous different children working with different therapists.

Notes were often signed off by therapists before they had finished the session in question, and Medicaid was frequently billed for unallowable activities, such as naps and lunch.   

For their 2023 report on private equity鈥檚 influence on ABA, investigators at the Center for Economic and Policy Research interviewed former employees of one of the oldest therapy center networks, the Centers for Autism and Related Disorders, or CARD. Founded by one of Lovaas鈥 graduate students, the chain was sold to the private equity group Blackstone in 2018 for a reported $700 million.  

The former employees said that under Blackstone鈥檚 management, they were told to prioritize younger children. Not only can smaller kids remain enrolled for several years before reaching school age, they are most likely to be referred for additional hours of therapy per week under the guise of early intervention. 

Center for Autism & Related Disorders office, Franklin Square, New York, 2022 (Google Maps)

鈥淭hey would literally terminate patients in our programs who required lower hours and replace them with those requiring at least 30 to 40,鈥 the researchers quoted one former employee as saying.

CARD did not respond to requests for comment. In a statement to 社区黑料, Blackstone said the network of centers was hit by a 鈥減erfect storm鈥 of COVID-19-era lockdowns, labor shortages and low insurance reimbursement rates that led to a Chapter 11 restructuring. 

鈥淲hen it became clear that a restructuring was necessary to put the company on the best long-term path to deliver on its mission, we worked day and night 鈥 to keep its existing facilities open so the company could continue serving patients,鈥 the statement says.

The statement adds that Blackstone was never involved in specific clinical treatment decisions and had sought to increase pay, reduce caseloads and improve training and operations. 

If an individual center or an entire network is accused of fraud or found to have abused patients, the investment managers who made decisions to maximize profit can鈥檛 be held accountable. Just like the debt, liability accrues to the 鈥減ortfolio company鈥 that owns the actual centers.  

By 2022, CARD had in states with lower Medicaid reimbursement rates and made that put others out of business, shrinking from 250 centers to 100. In June 2023, it filed for bankruptcy and was bought by a group of private investors recruited by its founder.

According to 社区黑料鈥檚 dataset, in 2019, CARD billed Medicaid more than $13 million. In 2024, its Medicaid receipts were slightly less than $2 million.

Private equity鈥檚 structure shields investors and ABA network owners from liability

With corporate headquarters in Farmington, Michigan, Centria Healthcare was founded in 2009 as a pediatric nursing provider. When one of its early patients needed ABA, the company created an autism-focused division. Today, it owns centers in 11 states. 

Because the company is privately owned, its finances are largely shrouded in secrecy. But, according to the investor intelligence service Pitchbook and data gathered for the Center for Economic and Policy Research, Centria was purchased in 2016 by Martis Capital, a private equity firm specializing in acquiring North American healthcare providers. Over the next three years, Centria expanded to nine states. 

Centria headquarters, Farmington, Michigan (Google Maps)

As part of a 2018 , the Detroit Free Press reported that Michigan鈥檚 attorney general was looking into claims that Centria had engaged in improper billing and service provision. The story was based on interviews with former company executives, documents obtained by reporters and allegations detailed in a defamation lawsuit the company filed against some of the past employees. 

The paper also reported that two Michigan counties had after local mental health officials cited the company for billing and care issues and an employee was abusing a child. 

Martis Capital did not respond to a request for comment.  

In a statement to the newspaper, Centria CEO Scott Barry vigorously denied the claims: “Whatever these allegations are, yes, they’re very outrageous, but they’re not true. And we’re trying to do a good job to help kids and help families and help our community.”

At the time, the company was in line for an $8 million job-creation grant secured with the backing of the state鈥檚 lieutenant governor, described by the Free Press as a longtime advocate of autism therapy. Five weeks after then-Lt. Gov. Brian Calley made the recommendation, a key company investor hosted a party kicking off Calley鈥檚 gubernatorial bid. Guests donated more than $100,000 to his campaign, the paper reported.      

The grant was put on hold while the state investigation unfolded. In March 2019, the state closed the probe, saying that while it had noted potential billing irregularities, there wasn鈥檛 enough evidence to merit criminal complaints. The grant was not reissued. 

Three former executives later sued Centria, resurfacing their allegations. Both lawsuits were eventually dismissed by the parties.

In a statement to 社区黑料, Centria CEO David Harbour said the company focuses on quality and access.

鈥淥ur work is grounded in a commitment to ethical care, clinical quality and supporting children with complex needs 鈥 including families who may have struggled to find services elsewhere,鈥 Harbour wrote. 鈥淲e strive to identify the needs of children, families and the broader healthcare system as it continues to evolve 鈥 delivering ethical, individualized care that supports the unique needs of each child and family we serve.”

But Centria doesn鈥檛 have to report whether the scandals had any impact on its bottom line. 

鈥淸Private equity firms] have nothing to lose if something goes bankrupt,鈥 says Rosemary Batt, one of the authors of the Center for Economic and Policy Research report and a professor emeritus at the Industrial and Labor Relations School at Cornell University. 鈥淚f a company gets caught in fraud, it鈥檚 just the cost of doing business.鈥

In 2019, Centria was sold to a different private equity fund, Thomas H. Lee Partners, for $415 million. Since then, according to 社区黑料鈥檚 analysis, the company has been the country鈥檚 largest Medicaid biller, bringing in more than $440 million during our six-year window. That鈥檚 more than twice as much as the second-largest ABA company by Medicaid revenue, Lighthouse.

Thomas H. Lee did not respond to a request for comment. 

Ryan Leitner, a researcher at the Private Equity Stakeholder Project and the author of a on the ABA industry, worries that states鈥 efforts to crack down on Medicaid abuses won鈥檛 address the underlying cycle that allows investment funds to pass off a business that they鈥檝e saddled with problems.      

鈥淎 great place to start is the concept of joint liability between these [investment] firms and the company that they own and operate,鈥 says Leitner. 鈥淵ou need to have assurances that the care is going to meet some kind of benchmark, that there’s going to be some kind of joint liability if there is a problem.鈥   

Some states, he adds, are trying to give their attorney general or another regulator the ability to stop the sale of a healthcare facility if they determine the company won鈥檛 run it properly or if a private equity firm has problems elsewhere. 

Private equity providers gravitate toward high-reimbursement states 

Writing in the January 2026 issue of the American Medical Association journal JAMA Pediatrics, a group of researchers , one showing the prevalence of children with autism diagnoses and the other assigning states 鈥済enerosity scores鈥 assessing their insurance rules regarding autism. 

Using a commercial deal tracker, they identified 574 autism service delivery sites acquired by private equity between 2015 and 2024, which they overlaid on the maps. The upshot: The states with the highest rates of diagnosis and the most generous benefits have the largest concentration of private equity-owned ABA centers. 

Home to some of the first acquisitions, Colorado, with 6 million residents, had 38 private equity-owned centers, the third-largest concentration in the country and a likely undercount, the researchers noted. Only California, home to more than 39 million people, and Texas, which has 32 million residents, had more private equity-owned ABA centers 鈥 97 and 81, respectively. 

In February, the Department of Health and Human Services’ Office of the Inspector General released the fourth of eight state audits, finding that Colorado鈥檚 Medicaid spending on ABA mushroomed from $60 million in 2019 to $163.5 million in 2023. 

The auditors examined claims made in 2022 and 2023, finding at least $78 million in improper payments, plus an estimated $207 million in 鈥減otentially inappropriate鈥 claims. 

In Wisconsin, they found $18 million in improper payments in 2021 and 2022, plus $94 million more in potentially inappropriate payments. In Maine in 2023, $45 million in claims were improper and $22 million potentially so. In Indiana, a total of $56 million were improper in 2019 and 2020, with another $76 million potentially improper.

In Colorado, the investigators examined monthly billing records for 100 children, finding improper and potentially improper claims in every case. Seven facilities could not supply individual patients鈥 diagnoses or referrals.

Two providers 鈥 including one that auditors said 鈥渨as purchased by a nationwide ABA company that subsequently closed all of its ABA facilities in Colorado鈥 鈥 did not respond to requests for records from state and local investigators. 

In the 96 months auditors examined, providers didn鈥檛 describe the services in some claims; four providers didn鈥檛 submit any treatment notes at all. One facility routinely said a child had engaged with peers even though the therapy was delivered at home with no other children present.          

Numerous bills described unallowed 鈥渃ustodial care,鈥 such as bathing, dressing and eating. In 67 months, facilities billed for one-to-one therapy but described group activities. 

ABA companies in Colorado

In May, the Colorado General Assembly took up legislation aimed at . At an , state officials testified that they believed there were between 410 and 500 clinics but could not say with precision because, unlike day cares, summer camps and similar facilities, autism therapy centers are not required to register with the state.  

In 2025 alone, officials received 35 reports of endangerment, including physical abuse by staff, medication mistakes, inappropriate restraint and a registered sex offender working at one center. But because ABA providers and facilities are unregulated, the state lacked jurisdiction to investigate. 

It might be the tip of the iceberg, the state officials warned lawmakers, because many participants can鈥檛 tell their families when something is wrong. At least a third of Colorado children in ABA are nonverbal, and more than 18% are age 3 or younger. 

The bill would create a behavior analyst licensing board and require the state Department of Human Services to craft standards for clinics. The board would consist of three credentialed behavior analysts, one assistant 鈥 or technician 鈥 and one member of the public. It would grant licenses to people who have been given credentials by organizations created by the ABA therapists associations.

To proponents of ABA, many of whom have nursed concerns that private equity is sullying the public profile of their industry, the bill was a huge win. But to many in the disability community, it was one more step in the wrong direction. They feared that new standards would enshrine a treatment they oppose, crowding out public support for alternatives that may be more effective and humane.       

Two parents submitted imploring legislators to oppose or amend the bill. Both cited ABA’s eugenicist roots and research on its harms.  

鈥淎utistic adults often compare ABA to gay conversion therapy, because the goal is often to make autistics appear less autistic, rather than helping them live safely and comfortably as themselves,鈥 wrote Boulder parent Jenny Thamer. 鈥淚n fact, both practices were developed by the same founder.鈥

Among other changes, she asked lawmakers to appoint a licensed mental health professional and an autistic adult 鈥渨ho provides lived experience鈥 in place of two of the three analysts on the board; to require discipline for practitioners who engage in harmful punishments, including physical restraint and seclusion 鈥 mostly outlawed in Colorado schools 鈥 and to remove references in the bill to ABA as 鈥渂ased on scientific research.鈥

鈥淭his bill will have lasting consequences for autistics for decades,鈥 Thamer concluded. 鈥淚 respectfully urge you not to expand this system without strong protections, independent oversight and meaningful representation from the autistic people most often harmed by these practices.鈥

On June 2, Gov. Jared Polis signed the bill without her recommended changes. 

Graphic design by Eamonn Fitzmaurice

This investigation was produced with support from the Education Writers Association Reporting Fellowship program.



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