Autism therapy scrutiny grows after NYT report on NC clinics

A New York Times investigation into autism therapy clinics has put a national spotlight on the same Medicaid spending and oversight concerns North Carolina lawmakers and state Auditor Dave Boliek have been raising for months.

The Times story, published May 23, focused heavily on Compleat Kidz, a North Carolina-based autism therapy chain, and described young children spending long days in clinics while Medicaid covers much of the cost. 

More than 80% of Compleat Kidz patients are covered by Medicaid, and the company has collected about $130 million from the program since 2019, according to the Times.

The investigation reported that the rapid growth of applied behavior analysis, or ABA therapy, has raised concerns about overbilling, long treatment hours, private equity investment, and whether some providers are prescribing more care than children need.

ABA therapy is widely used for children with autism, and many families say it has helped their children improve communication, behavior, and daily living skills.

The report lands after months of scrutiny in Raleigh. 

Boliek recently said his office is examining the surge in Medicaid-funded autism therapy costs, pointing to a rise from roughly $1.4 million in total billings to more than $660 million annually over a five-year period. 

“The State Auditor’s Office is in the middle of a large-scale review of ABA therapy in North Carolina that will look at potential fraud, lax oversight, and everything in between,” said Randy Brechbiel, a spokesperson for the Office of the State Auditor. “With over 3 million North Carolinians enrolled in Medicaid, it’s important to examine these costs on behalf of the taxpayers who fund the program.”

Data presented to lawmakers at a March Joint Legislative Oversight Committee on Health and Human Services and Medicaid meeting showed spending on autism therapy services surged by 347% from 2022 to 2025. During that period, the number of children receiving services grew from 3,844 to 13,447.

The Times investigation adds a ground-level look at what that growth can mean inside clinics.

At a Compleat Kidz clinic in Concord, reporters described preschool-age children working one-on-one with therapists in small cubicles. In one scene, a 6-year-old girl fell asleep after hours of therapy and was awakened after seven minutes under the company’s nap policy. Compleat Kidz told the Times the rule is meant to prevent fraud because clinics can bill insurers or Medicaid only when children are awake and receiving services. 

The investigation also raised questions about whether the industry’s financial incentives encourage excessive treatment hours.

Current and former workers told the Times that some clinics recommend 25, 30, or even 40 hours of therapy per week. Some said clinics encouraged families to keep children out of school so they could attend more therapy. One former executive said therapy hours were sometimes based on a child’s availability rather than clinical need.

North Carolina’s 2026 Medicaid budget agreement includes provisions to address those concerns.

Under the agreement, any ABA service plan involving more than 16 hours per week must be approved by a Medicaid prepaid health plan or the Department of Health and Human Services. Those plans must also be updated and reapproved monthly.

The budget language also requires Licensed Qualified Autism Service Providers, or LQASPs, to develop individualized service plans for each Medicaid beneficiary. Those plans must include involvement from a parent, guardian, or caretaker.

The agreement limits telehealth as well. Paraprofessionals are no longer able to provide ABA services through telehealth, and patient assessments conducted by licensed autism providers must be conducted in person.

Licensed providers may still use telehealth to observe and direct paraprofessionals, but remote supervision cannot make up more than 50% of that provider’s services for an individual Medicaid recipient.

The rules also focus on paraprofessionals, who often provide the direct therapy. The Times reported that Medicaid often pays about $70 per hour nationally, and $83 in North Carolina, for therapy largely delivered by workers with high school diplomas who earn around $20 per hour.

Under the budget agreement, at least 10% of all services provided by a paraprofessional must involve observation and direction by an LQASP. For beneficiaries receiving more than 200 hours of paraprofessional services from a provider over six months, providers must document that LQASP services equal at least 10% of the paraprofessional hours unless additional services are medically necessary.

The Times also reported that autism clinics operate with less state oversight than child-care centers, even though young children may spend long days there. The Times said it found 12 police reports of child abuse at Compleat Kidz facilities since 2023. At least two resulted in criminal charges against employees, and another is the subject of a lawsuit filed by a parent. 

North Carolina Medicaid opened an investigation into Compleat Kidz after the Times shared its findings. Melanie Bush, North Carolina Medicaid’s director, told the Times the program was prepared to take “swift and appropriate action,” including possible suspension of Medicaid payments or termination from the program if warranted.

The budget agreement includes enforcement language allowing DHHS to recoup payments for a first or second occurrence of noncompliance. For a third instance of material and systematic noncompliance, the department could suspend a provider’s eligibility to bill Medicaid for one to two years.

“Autism therapy scrutiny grows after NYT report on NC clinics” was originally published on www.carolinajournal.com.