Short Naps, Long Hours: How Autism Clinics Squeeze Medicaid Dollars Out of Preschoolers

In this New York Times investigation, Sarah Kliff and Margot Sanger-Katz report on how autism therapy in the US has exploded into a multi-billion-dollar business, driven by rising diagnoses, private equity investment, and expanded Medicaid coverage—with little regulatory oversight. Kliff and Sanger-Katz focus on Compleat Kidz, a chain of ABA-therapy clinics in North Carolina, and spoke to 14 former employees who said its for-profit model harms children. Kids are only allowed to nap for seven minutes before being woken up in order to maximize billable hours; therapy hours are over-prescribed; and children are sometimes recommended to be taken out of school so they can attend more therapy sessions. Kliff and Sanger-Katz also uncover a dozen reports of child abuse at Compleat Kidz locations; their reporting makes clear that this company is just one example in a growing industry.

Medicaid often pays about $70 per hour ($83 in North Carolina) for therapy largely provided by workers with high school diplomas who earn around $20.

Private equity firms have acquired at least 500 clinics over the past decade. “There’s just huge opportunities to grow these businesses and help increase access to care,” said Jon Krieger, a managing partner at Calex, a financial firm that assists with autism clinic mergers and acquisitions. He estimates the market could grow to $90 billion.

The facilities have a double appeal for many parents: Along with promising better behavior, they can amount to free child care because Medicaid pays all the costs.