Virginia: Exploding cost of ABA: $243M in 2025; "regulatory system here is utterly broken"

June 8, 2026, Autism in Virginia | Bacon's Rebellion –

Autism therapy is the wild west of medical qualifications and spending.

Autism is real, but industry professionals and the non-profits who lobby for limitless autism spending have richly earned widespread skepticism of the industry by not policing their own. They have created a closed loop for eternally increased spending:

The profession describes limitless demand.  

Therapy is thus supply-driven, raising practitioners’ reimbursements. (That increases the demand for online college courses that too often result in debt and a failed professional exam.)

The Virginia government buys that story unquestioningly, at least in part because the regulatory system here is utterly broken.  

The budget committees of the Virginia General Assembly, whose Health committees designed that regulatory system, allocate new “slots” for kids each year in the Medicaid budget and raise the payment rates in the same session.  

There are long waiting lists – see above for limitless demand. . . .

The exploding spending on treatment.  

An autism diagnosis for a child is typically made by a pediatrician, a child psychologist, a child neurologist, or a child and adolescent psychiatrist. The populations of both autism patients and therapy providers have exploded, making Applied Behavioral Analysis (ABA) the fastest-growing and most troubled program in both Medicaid and private health insurance.

According to Behavioral Health Business

Medicaid spending on core Applied Behavioral Analysis (ABA) autism services increased by 403% from 2019 to 2024. The number of provider entities delivering these services to Medicaid recipients increased 346%. This suggests that much of the increase in spending is driven by new providers opening their doors.

So autism treatment growth actually is supply-driven, not demand-driven. The Wall Street Journal has been on top of the ugly side of that story. Virginia’s troubles have been discussed in this space and will be again.

Autism Demographics

Autism is diagnosed in boys at four times the rate of girls. The American Psychiatric Association blames chromosomes for the difference. We note that Borderline Personality Disorder (BPD) is diagnosed predominantly in women and girls—historically making up about 75% of clinical diagnoses.

Experts don’t know what to blame that on. . . .

About 1 in 31 (3.2%) children aged 8 years have been identified with autism spectrum disorder (ASD)”.

Increased identification of autism, particularly among very young children and previously underidentified groups, underscores the increased demand and ongoing need for enhanced planning to provide equitable diagnostic, treatment, and support services for all children with ASD. The substantial variability in ASD identification across sites suggests opportunities to identify and implement successful strategies and practices in communities to ensure all children with ASD reach their potential.

Translation: autism is vastly under-tested and underdiagnosed in most of the country. We’d better hope they are wrong and that it is instead overdiagnosed in urban areas. It is hard to tell how we will ever find out, because autism diagnosis and treatment is a closed-loop system that pays a lot of people a lot of money.  

In this case, it is hard to tell what “equitable” means about race, because black kids are diagnosed with autism at twice the rate of white kids.  . . .

Nationally, Medicaid spent $2.2 billion on autism in 2023. If the CDC is right and 3.2% of children have autism, the bill should have been $17 billion. If the CDC is right and the true percentage is much higher than that (among the evidence they put forth was a California site’s 5.5%), the sky is the limit.

In FY 2025, Virginia Medicaid spent $31,216 per member diagnosed with and treated for autism for a total of $243 million. Virginia has 1.88 million residents who are under age 18.

At the projected 1 in 31 occurrence rate, autism would affect 60,645 Virginia youth. At the 5.5% ratio, the number would be 103,400.

That would mean the actual demand is between

$1.9 billion from Virginia Medicaid alone, 7.8 times what we are spending today, and

$3.23 billion, 13.2 times current Medicaid expenditures for autism services in Virginia. Virginia’s total Medicaid expenditure in FYE 2025 was $24.3 billion. . . .

Autism is real, and there are true professionals in the industry who know what they are doing and do it ethically. But the private equity-owned chains that are beginning to dominate the industry perhaps have different motivations and business models.

We have previously published evidence that, like the private insurers, the Commonwealth struggles to control fraud even at current spending levels. As recommended in more detail there, the federal government needs to reform the NPI system, and the Governor and the General Assembly need to get to work redesigning the regulatory system.