Autism Therapy is in Dire Need of a New Business Model

Even these recent, dramatic headlines don’t do justice to just how badly autism therapy providers are facing a moment of reckoning: 

Federal audits and state investigations are rightfully delving into how hundreds of millions of Medicaid dollars are being spent on autism services across several states. These actions coincide with a growing demand for change from families, providers, payors, and policymakers. 

And just as providers bear some responsibility for the problem, the evolving industry now has a unique opportunity to be part of the solution. Novel models have begun to emerge that demonstrate how stronger provider transparency and accountability can reverse this dynamic and deliver lasting, positive change for payors, therapists, kids, and their families.

How did we get here

Clinicians and insurers have long agreed that Applied Behavior Analysis (ABA) is the gold standard in autism therapy. This evidence-based care discipline equips individuals with the skills they need to enjoy greater independence and access within their communities over time. Recent concerns about waste and overbilling stem not from the therapy itself, but from market trends that incentivize therapeutic intensity over effectiveness, compensating providers based on hours of therapy delivered rather than clinical outcomes achieved. 

In ABA, therapy is provided by a Board-Certified Behavior Analyst (BCBA), a Registered Behavior Technician (RBT), or a combination of the two. Importantly, a BCBA is a Master’s- or PhD-trained clinician, while RBTs typically have only a high school diploma and a 40-hour certification course plus exam. But the explosion in autism diagnoses (now 1 in every 31 kids) means there are not enough BCBAs to keep up with demand, especially because they are unevenly distributed around the country. 

In response, autism therapy centers have thrown more RBTs and more hours at the problem, with an opportunistic standardization emerging. Imagine a pyramid with a small number of centralized in-person therapy centers at the top, a handful of BCBAs managing large teams of lesser-trained RBTs delivering 30-hours of templatized therapy beneath, and families at the bottom. Absent an alternative, Medicaid and commercial insurers have responded with reimbursements for therapy in an effort to help combat what was seen as an autism epidemic. 

And then private equity (PE) firms stepped in, acquiring more than 500 centers over the past decade, locking in a low-cost, highly profitable model that prioritizes volume and profitability over outcomes and impact. The result has been an increase in therapeutic intensity (a 298% surge in ABA therapy hours billed to Medicaid from 2019-2024) that has dramatically outpaced the rise in autism prevalence (roughly 74% from 2016-2022). No wonder the Wall Street Journal calls autism therapy a “jackpot”. 

The promise of ABA 2.0 

It’s clear that, as a field, it can no longer be business as usual. If traditional autism approaches continue to dominate, these audits and investigations will turn into a dense thicket that will eventually (and unfairly) paint the foundational practice of ABA as the problem. This is a business model issue, and a reflection of bad actors taking advantage, not a fault in the clinical standard of care. 

An emerging evolution of ABA has the promise to address these business model concerns while reinforcing the clinical effectiveness of the therapy and increasing transparency in the process. This new approach has steadily built momentum in the wake of the pandemic and coalesced around four key tenets. 

• Caregiver training: Therapy doesn’t have to stop at the end of a child’s session. Training parents and family members to reinforce learned behaviors around the clock, and in the moment, can help kids reach key milestones faster. 
• BCBA-led direct care: It just makes sense to rely on better-trained therapists who are more attuned to a child’s needs and better able to customize therapy to their specific strengths and preferences. 
• Optimized therapy setting: Skills learned in natural environments are more likely to take root. Conducting sessions in a home and on a screen can improve retention and eliminate long drives and waiting rooms. 
• Outcomes-based contracting: Quality providers should be confident in tying compensation to results, not hours billed. 

Technology has emerged as a key enabler of this ABA 2.0 approach. For example, virtual autism therapy is uniquely suited to optimize for therapy settings and to connect families with quality BCBAs at a time when these professionals are in short supply (roughly 50% of U.S. counties have no BCBA living there). 

Some providers have already turned to AI to facilitate the creation of autism treatment plans for new patients, automate note-taking during session notes, improve the matching of therapists to kids based on need and fit, and tailor individual sessions to each child’s specific interests and opportunities. In our experience, virtually-delivered, AI-enabled care by BCBAs has helped deliver positive clinical outcomes for kids, with 85% fewer hours required and at 75% less cost.

The great unlock of ABA 2.0 is an embrace of outcomes-based care delivery and payor contracting. It was the fee-for-service model that attracted PE to the autism sector. If we as an industry want to head off external regulation and a narrowing of our field, then putting fees at risk around outcomes is the fastest path to self-policing and true value creation for families, payors, and providers. 

What’s next

While uncomfortable, this moment of scrutiny should be viewed as an opportunity. The autism care system in the U.S. needs stronger accountability and transparency. But it also needs new models that can deliver higher-quality care to more families, more efficiently, and regardless of where they live. A new breed of outcomes-based providers practicing ABA 2.0 is how we as an industry find our way back to the moral and clinical high ground. 

Photo: primeimages, Getty Images

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