OPINION:
As a physician and longtime chief medical officer in managed care, I have a clear message for federal and state law enforcement: Keep cracking down.
The Justice Department’s recent law enforcement actions, paired with the Centers for Medicare & Medicaid Services’ major oversight tool kit released this month targeting high-risk behavioral health categories, are a necessary and welcome relief.
When rogue operators bilk public safety nets through phantom billing, fake diagnoses or billing for unsupervised care while children watch tablets, they are not just committing financial crimes. They are also exploiting vulnerable children and undermining public trust in essential healthcare.
We must be able to do two things at once: enthusiastically support expanded access to evidence-backed behavioral healthcare while aggressively rooting out the waste, fraud and abuse that threaten to ruin it.
The scale of the abuse within Medicaid-funded autism services, specifically Applied Behavior Analysis therapy, demands this level of enforcement. A recent federal audit by the Department of Health and Human Services reviewed more than $600 million in Medicaid payments for autism care across four states — Colorado, Indiana, Wisconsin and Maine — and found hundreds of millions of dollars in potentially improper or fraudulent payments.
In Minnesota, state Medicaid spending on autism-related behavioral therapies exploded from $670,000 to more than $342 million between 2019 and 2024 — a staggering increase of nearly 51,000%. This was driven in large part by fraudulent entities now facing federal indictments for tens of millions of dollars in phantom billing.
In Colorado, auditors caught one provider billing 151 hours of therapy in a single month.
These alarming statistics do not reflect a sudden, overwhelming surge in true medical need. Rather, they reflect systemic vulnerabilities that opportunistic bad actors have rushed to exploit.
Historically, the rapid expansion of Medicaid autism coverage has outpaced regulatory guardrails. Traditional fee-for-service models paid strictly by the hour without requiring proof of developmental progress, inadvertently creating a bottomless pot of gold for bad actors.
Flawed rules even allowed self-referral loops, where the entity diagnosing a child’s condition could also prescribe and fulfill maximum-capacity, 40-hour-a-week care plans without independent review.
The tragedy of this abuse is twofold. First, it drains finite public resources. Second, it robs children of irreplaceable time.
Early childhood development is not a window that can be reopened once it has shut. The evidence for 20 hours to 40 hours per week of intensive ABA therapy versus 15 hours per week is not clear. More is not necessarily better and may even be harmful, so we need better reporting and accountability.
To ensure that law enforcement crackdowns lead to lasting integrity, we must address the underlying structural challenges in the behavioral health system.
CMS released landmark national guidance and a 173-page tool kit instructing state Medicaid programs to clamp down on fraud, eliminate automated 40-hour weekly therapy quotas and restrict improper billing in autism care.
This action follows a national behavioral health quality pledge secured by HHS from major health plans, medical societies, health systems and provider organizations to advance evidence-based diagnoses and track measurable outcomes.
To translate this national pledge into real-world practice, state leaders must empower managed care organizations. Because these organizations administer the vast majority of state Medicaid programs, they are uniquely positioned to move away from passive fee-for-service pass-throughs and actively manage for quality.
States should empower managed care organizations to require independent diagnostic verification for high-hour treatment plans, mandate real-time electronic visit verification and tie reimbursement to objective, evidence-backed developmental milestones rather than simple clock hours.
Enforcing integrity and expanding care are not opposing goals; they are the same goal. By standing with law enforcement to remove bad actors and empowering managed care organizations to drive evidence-based outcomes, we can protect taxpayer dollars and preserve life-changing care for the children who depend on it.
• Andrea Gelzer, M.D., is the CEO of Qual-IT Strategies.
Please read our comment policy before commenting.