If it seems like every day, or at a minimum every week, brings news of another scam within the health care sector, you wouldn’t be wrong. From duplicate enrollments to “coverage” of dead people to the recent growth of skin substitutes, examples of waste, fraud, and abuse abound.
Recent stories have drawn attention to abuses regarding treatments for autism. The Minnesota fraud scandal brought this issue to the fore, but the problems go well beyond the Gopher State. A recent Wall Street Journal report and investigations by the Department of Health and Human Services’ inspector general show the widespread nature of the problem, which, in addition to outright fraud, also encompasses wasteful and unnecessary government spending.
Spending Free-for-All
The Journal investigation profiled the recent explosion in autism therapy payments within Indiana’s Medicaid program. The issue at the root of the spending increase: “the state started reimbursing providers 40% of whatever they billed” (emphasis mine).
It doesn’t take a Ph.D. in math or accounting to realize that 40 percent of a large number — particularly when a provider’s hourly rate has no maximum — is also a very large number. Thankfully, Indiana has changed its reimbursement practices, but not before Hoosier State taxpayers got gouged.
The investigation noted that Indiana Medicaid’s spending on autism swelled roughly 30-fold in six years — “from $21 million in 2017 to $611 million in 2023.” One company charged $1,600 per hour, with Medicaid paying 40 percent of that, or $640 per hour — “for routine therapy that can be administered by workers with little more than a high-school diploma,” who earn roughly $20-30 per hour.
In 2023, this company reportedly received $29 million to provide therapy to 84 patients, a per-patient cost of roughly $340,000 per year. Around this time, the company’s founder purchased a $2.5 million home on Sanibel Island in Florida and quickly paid off her mortgage — thanks in no small part to Indiana and federal taxpayers. Another CEO of an autism therapy company, who charged Indiana taxpayers “only” $250 per hour for services, made clear to the Journal she had little concern for taxpayers: “I’ve never been like, am I going to feel bad about making what I make?”
Federal Audits
A recently released inspector general audit found myriad problems with autism therapy coverage in Colorado’s Medicaid program. Among the audit findings: “for all 100 sampled enrollee-months, the State agency made potentially improper [therapy] payments.”
You read that right: Not a single one of the enrollee months sampled had zero errors or potential errors. Of the $610,933 in paid claims examined, the inspector general could conclusively determine that $862 was paid correctly — that’s .14 percent. The other 99.86 percent of the spending got classified as improper or potentially improper.
The errors and omissions mentioned in the inspector general report were legion: Therapists didn’t properly or fully document the therapy provided; they billed for one-on-one therapy during group sessions; and my personal favorite: “documented nap time was included in the units of [therapy] paid.” And here I thought the only people paid taxpayer dollars to nap were members of Congress.
More chillingly, the report notes that Colorado’s Medicaid program did not require criminal background checks of therapists and technicians. The list of people providing “therapy” to one 11-year-old child with autism would scare the daylights out of most parents:
[T]hree facility staff members had criminal convictions. One behavior technician (a non-credentialed provider) had a weapons-related felony offense 3 months before the sampled enrollee-month. The second staff member … was convicted of: (1) a misdemeanor assault in the third degree and (2) misdemeanor harassment described as a strike, shove, or kick. The assault occurred 2 years and 2 months before the sampled enrollee-month, and the harassment occurred 7 months before the sampled enrollee-month. The third staff member, a behavior technician, was convicted of a weapons-related aggravated misdemeanor.
The report leaves the general impression that, in too many cases, autism therapy is at best a joke designed to bilk money out of Medicaid and at worst a danger to the patients themselves.
Harm to Patients
The injury in these cases goes far beyond dollars and cents, as sizable as those sums may be. Many patients with autism need high-quality care. If therapy providers are focused more on making money, whether that means giving patients more therapy than they can reasonably tolerate or engaging in unproductive activities like “supervising” nap time, patients get neglected and suffer. Scandals like these can also create a general cynicism about behavioral therapy that harms patients.
Medicaid was designed to provide a safety net for the most vulnerable portions of our society, which would include patients with autism. The abuses and scams that have come to light cheat not only taxpayers but also these vulnerable patients. It’s another reason why state and federal officials — in both blue states like Minnesota and red states like Indiana — need to reform the system to eliminate this wasteful, harmful spending.
