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August 16, 2022

Private equity in autism care: The advantages and tradeoffs

Daily Briefing

    Private equity firms have made substantial investments in autism therapy over the past decade. And while this has helped increase access to care nationwide, some parents and clinicians argue that private equity-backed clinics are often more focused on profit than care, leading to "cookie-cutter" treatments that don't always benefit patients, Tara Bannow reports for STAT.

    Cheat sheets: Evidence-based medicine 101

    Private equity firms are major investors in autism care

    In the early 2000s, states began mandating autism coverage at the urging of parents and advocacy groups. In 2001, Indiana was the first state to pass an autism therapy coverage mandate, and now, all 50 states require some coverage of applied behavior analysis (ABA), a common form of autism therapy.

    As coverage for autism therapy became more prevalent, private equity firms began investing in ABA, transforming a collection of small clinics to a multibillion-dollar industry with multiple national chains. Overall, more than 60 private equity firms, including Blackstone and KKR, have invested billions of dollars into the ABA industry over the last decade. 

    Currently, many of the largest ABA chains in the United States are backed by private equity firms, including:

    • Stepping Stones Groups
    • Hopebridge
    • LEARN Behavioral
    • Centria Healthcare
    • BlueSpring
    • Autism Learning Partners
    • Kadiant
    • Center for Autism and Related Disorders

    In total, these organizations have thousands of employees and serve hundreds of thousands of patients across the United States.

    How private equity has affected autism care

    According to Bannow, parents, clinicians, and other experts have expressed concerns about the ABA industry, particularly about clinics that are owned by private equity firms.

    For example, many of the people STAT spoke with reported a severe shortage of providers, as well as constant turnover among clinicians, which prevents children with autism from getting consistent, quality care.

    "My experience has been just being run into the ground," said Nirvana Kowlessar, a board-certified behavior analyst in Oregon. "It's just such a shame because there are really good people and talented clinicians and everybody works so hard."

    Many former employees at private equity-owned organizations have also said that the pressure to hit billing quotas and maximize patient hours made it harder for them to devote time to their patients.

    "[I] don't have time because now I have the pressure of billing, I have the pressure of completing my quota," said Sanjukta Mukherji, a board-certified behavior analyst who used to work at a private equity-owned ABA chain, "and then I have 14 more clients to go to who all need pretty significant time and effort from me. I really feel the quality suffers."

    In addition, ABA providers at private equity-owned organizations have been accused of using "cookie-cutter templates" for treatments, even though autism therapy is supposed to be individualized to each patient.

    "You can't just walk in and hand people a book and say, 'This is what we're doing this week,' because you're going to totally miss the point of what this individual child and the parents need," said Eric Larsson, executive director of clinical services for the Lovaas Institute Midwest, a private ABA provider that is not owned by a private equity firm.

    Separately, Julie Bauer, who worked as a technician as Autism Learning Partners, said that she would often have an old client's name on a new client's plan. "It would literally be copy-pasted from somewhere else," she said. "I would tell them, 'I need you to go back and edit this and make it more appropriate to what we're doing.' All the time that would happen."

    For their part, ABA companies owned by private equity firms have pushed back on claims that their treatment plans are not individualized and that they are not providing high-quality care.

    "Every treatment plan we develop is customized to the individual patient, informed by the Behavior Analysis Certification Board guidelines and the assessment of our Board Certified Behavior Analysts after meeting the patient and their family," Autism Learning Partners said in a statement. "Our investors have no say in the delivery of care."

    Larsson noted that providers may be pushed into more standardized treatment approaches from insurers, who will not fully cover the cost of thorough assessments and treatment planning.

    In addition, some people say that private equity investments have been beneficial to the ABA industry, particularly by expanding access to care.

    For example, Anna Bullard, VP of government relations at the Behavioral Health Center of Excellence, said she struggled to find ABA providers where she lived in rural Georgia after her daughter was diagnosed with autism in 2007. However, after private equity firms began investing in ABA clinics, more clinics and virtual services became available.

    "I didn't have to drive one and a half hours one way," Bullard said. "That's the case for a lot of families." (Bannow, STAT+ [subscription required], 8/15; Bannow, STAT, 8/15), 8/15)

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