Private equity’s autism therapy boom is straining Medicaid

The report examines the growth of private equity (PE) in the autism therapy sector, highlighting a pattern of aggressive acquisitions and debt-driven management. It argues that PE-backed providers often prioritize profit over patient care by using standardized treatment plans, pressuring parents for more therapy hours, and engaging in fraudulent billing. State audits in Massachusetts, Indiana, Wisconsin, and Colorado reveal millions of dollars in improper Medicaid payments and inadequate staffing. The document concludes with policy recommendations, including facility-level licensure and rules to ensure a high percentage of Medicaid payments go directly to care worker compensation.

• Private equity firms have aggressively consolidated the autism therapy market, with a Brown University study indicating that over 500 centers were acquired in the U.S. over the last decade, with nearly 80% of these acquisitions occurring between 2018 and 2022.
• PE-backed providers are accused of degrading care quality by replacing individualized treatment plans with standardized templates and reducing staff training and supervision to cut costs.
• There is evidence of systemic billing fraud and improper Medicaid claims, including instances where providers billed for more than 24 hours of service in a single day or billed for services on holidays.
• State audits have identified significant improper Medicaid payments for ABA services: Colorado made at least $77.8 million in improper payments (2022-2023), Indiana made at least $56 million (2019-2020), and Wisconsin made at least $18.5 million (2021-2022).
• The report identifies a trend of PE firms entering states with higher autism prevalence and more generous insurance reimbursement rates, sometimes using their market leverage to threaten site closures to extract higher rates from states.
• Case studies illustrate the risks of leveraged buyouts, such as the Center for Autism and Related Disorders (CARD), which was acquired by Blackstone in a $700 million deal but later filed for bankruptcy in May 2023 with approximately $245 million in debt.
• Some PE-backed providers have faced allegations of unethical behavior and physical abuse. For example, Hopebridge was the subject of reports involving allegations of staff using physical violence against children.
• The report recommends that states implement facility-level licensure and adopt rules similar to a CMS final rule requiring that at least 80% of Medicaid payments be spent on direct care worker compensation rather than profit or overhead.

APA

Private Equity Stakeholder Project (2026). Private equity’s autism therapy boom is straining Medicaid. https://pestakeholder.org/wp-content/uploads/2026/04/PESP_Report_PE-in-ABA_2026.pdf

Chicago

Private Equity Stakeholder Project. Private equity’s autism therapy boom is straining Medicaid. 2026. https://pestakeholder.org/wp-content/uploads/2026/04/PESP_Report_PE-in-ABA_2026.pdf.

Wikipedia

{{cite report |author=Private Equity Stakeholder Project |title=Private equity’s autism therapy boom is straining Medicaid |date=April 2026 |url=https://pestakeholder.org/wp-content/uploads/2026/04/PESP_Report_PE-in-ABA_2026.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{privateequitystakeholderproject2026private, author = {{Private Equity Stakeholder Project}}, title = {{Private equity’s autism therapy boom is straining Medicaid}}, institution = {Private Equity Stakeholder Project}, year = {2026}, month = apr, url = {https://pestakeholder.org/wp-content/uploads/2026/04/PESP_Report_PE-in-ABA_2026.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }