WASHINGTON, D.C. — The Centers for Medicare & Medicaid Services is urging states to strengthen oversight of applied behavior analysis services for children with autism after federal data showed Medicaid and Children’s Health Insurance Program spending on the therapy jumped 421% from 2021 through 2025, far exceeding growth in the number of children receiving services.
CMS released a new State Medicaid and CHIP Applied Behavior Analysis toolkit designed to help states assess medical necessity, provider qualifications, billing practices and other program-integrity risks as spending on ABA services expands.
The 421% increase in ABA expenditures compared with a 67% rise in children diagnosed with autism spectrum disorder who received services over the same period, according to CMS. The agency said the divergence raises questions about whether spending consistently reflects medically appropriate care and whether additional safeguards are needed.
The toolkit does not impose new federal requirements, restrict access to autism services or reduce states’ obligations under the Early and Periodic Screening, Diagnostic, and Treatment benefit. It also does not endorse a particular approach to ABA treatment, according to CMS.
Instead, the guidance gives states recommended practices covering clinical standards, Medicaid benefit design, payment methodologies, provider enrollment and credentialing, utilization management and fraud prevention.
“Every dollar lost to fraud or waste is a dollar that cannot reach a child who genuinely needs it,” CMS Administrator Dr. Mehmet Oz said. He added that ABA services should be “clinically appropriate, personalized, and delivered by qualified providers.”
CMS pointed to investigations, prosecutions and convictions involving kickbacks and harm to children as additional reasons for closer scrutiny of the rapidly expanding sector. The agency did not provide a count or financial estimate for those cases in its release.
Among the issues states are encouraged to examine are whether ABA treatment is individualized and medically necessary, whether the intensity of services reflects a child’s clinical needs, whether providers are properly qualified and supervised, and whether billing controls are sufficient to identify fraud, waste and abuse.
The toolkit also includes a checklist states can use to evaluate their existing ABA policies. CMS emphasized that states retain flexibility to develop approaches suited to their Medicaid programs, populations and policy priorities.
The initiative was developed using Medicaid data, peer-reviewed research and stakeholder input. CMS reviewed more than 40 literature sources and more than 240 publicly available state Medicaid coverage and policy documents, along with qualitative input from state agencies, providers, advocates and other stakeholders.
Health and Human Services Secretary Robert F. Kennedy Jr. characterized fraud prevention as a central objective of the guidance.
“This toolkit gives states practical tools that may be used to identify bad actors, protect families, and hold providers accountable,” Kennedy said.
CMS said it will continue working with states on oversight of ABA services while maintaining access to medically necessary autism care for Medicaid-eligible children.
The State Medicaid and CHIP Applied Behavior Analysis toolkit is available through Medicaid.gov.
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