Therapists and centers that provide applied behavior analysis (ABA) therapy to child patients with autism spectrum disorder (ASD) are facing enhanced scrutiny in 2026. Due to concerns about widespread fraud under Medicaid related to ABA therapy services, the U.S. Department of Health and Human Services Office of Inspector General (HHS OIG) is aggressively targeting ABA providers suspected of engaging in fraudulent billing practices.
For targeted providers, facing allegations of Medicaid fraud presents substantial risks. Medicaid fraud investigations can be either civil or criminal in nature depending on the circumstances involved. While both types of investigations present risks for significant financial penalties, criminal investigations can create exposure to federal prison time as well.
“ABA facilities and other ABA therapy providers are currently under the microscope. Those accused of receiving improper Medicaid payments for applied behavior analysis services provided to children with autism face substantial risks—and executing an informed and strategic defense is critical for avoiding unnecessary consequences in this scenario.” – Dr. Nick Oberheiden, Founding Attorney of Oberheiden P.C.
Along with the HHS OIG, Medicaid Fraud Control Units (MFCUs) and other federal and state authorities are targeting ABA therapy providers suspected of submitting fraudulent claims under the Medicaid program as well. State-level investigations will often lead to federal referrals, and it is not unusual for multiple federal government authorities to be involved in pursuing criminal charges.
Key Differences Between Fee-For-Service Audits and Medicaid Fraud Investigations
While most healthcare providers that bill Medicaid are familiar with the fee-for-service audit process, Medicaid fraud investigations are very different. From the authorities and personnel involved to the potential outcomes, all aspects of investigations focused on recovering fraudulent Medicaid spending present unique risks. As a result, for providers that are facing investigations involving potentially improper payments, it is critical to promptly build and execute a defense strategy that is tailored to the specific circumstances and risks at hand.
7 Key Steps for Defending Against an ABA Therapy Fraud Investigation Under Medicaid
With this in mind, ABA therapy providers that are facing Medicaid fraud investigations should take action to protect themselves immediately. Some key steps to take in this scenario include:
1. Engage a Medicaid Fraud Defense Attorney Promptly
ABA therapy providers that are facing state or federal scrutiny should engage an experienced Medicaid fraud defense lawyer promptly. These are complex and high-risk matters that require highly experienced legal representation. Whether providers can use documentation they have on-hand to dispute the government’s allegations of Medicaid billing fraud, they need to target a civil settlement, or they need to fight to avoid a criminal conviction in federal court, engaging experienced defense counsel is a key first step in the process.
2. Determine the Focus and Scope of the Investigation
Once engaged, experienced defense counsel will be able to intervene in the government’s investigation. This will slow down the process—which is key for allowing targeted ABA therapy providers to get up to speed at this stage—and it will also allow for an assessment of the investigation’s focus and scope.
“Medicaid fraud” is an extremely broad term that encompasses a wide range of unlawful practices. While it encompasses improperly billing Medicaid for services rendered, it encompasses the payment and acceptance of unlawful referral fees and other statutory and regulatory violations as well. When facing scrutiny from federal investigators, it is critical to have a clear and comprehensive understanding of the allegations they are targeting. Some common examples include:
False Claims Act Violations
The False Claims Act (FCA) is the main federal statute that prohibits fraudulent billings under Medicare and Medicaid. Under the FCA, the submission of any “false or fraudulent claim” for reimbursement can trigger liability for recoupments, fines, and other penalties. The FCA includes provisions for both civil and criminal enforcement; and, under the FCA, not only can ABA facilities face prosecution, but Board Certified Behavior Analysis, Registered Behavior Technicians, and other individuals can potentially face prosecution as well.
Anti-Kickback Statute Violations
The Anti-Kickback Statute (AKS) prohibits healthcare providers from offering, paying, soliciting, or accepting compensation in exchange for referring Medicaid beneficiaries. While there are exceptions, the AKS broadly prohibits referral fees, rebates, discounts, and other forms of remuneration offered in exchange for patient referrals. Similar to the FCA, the AKS includes provisions for both civil and criminal enforcement, and Medicaid fraud investigations can target both civil and criminal AKS violations.
Stark Law Violations
The Stark Law also prohibits the payment of referral fees and other forms of remuneration for Medicaid patient referrals, but it applies specifically to physicians and their related entities (it is also commonly referred to as the “Physician Self-Referral Law”). Similar to the Anti-Kickback Statute, it is intended to prevent covered healthcare providers from providing at taxpayers’ expense, and violations of the Stark Law can also be prosecuted as a form of fraud, waste, and abuse (FWA) under the False Claims Act.
Health Care Fraud Statute Violations
The health care fraud statute (18 U.S.C. Section 1347) is a federal criminal statute that outlaws knowingly or willingly executing (or attempting to execute) any scheme or artifice to defraud Medicare or Medicaid. Under the health care fraud statute, ABA centers and other entities can face six-figure fines, while individuals can face six-figure fines and up to 10 years of federal imprisonment.
3. Conduct an Internal Compliance Assessment Related to Applied Behavior Analysis Provided and Billed Under Medicaid
After determining the scope and focus of the government’s investigation, targeted providers should then conduct an internal compliance assessment related to their applied behavior analysis (ABA) therapy services provided and billed under Medicaid. This assessment should be conducted with the oversight of outside counsel to secure the protection of the attorney-client privilege. The purposes of this assessment should include (but not be limited to):
● Determining if the provider has improperly billed Medicaid for ABA services rendered;
● Determining if the provider has the medical records (including treatment plans) and
billing records needed to affirmatively demonstrate compliance; and,
● Determining the scope of the provider’s Medicaid billing-related exposure.
While applied behavior analysis is a therapeutic approach that is an essential form of treatment for many children with autism, the federal government (and state governments) are currently prioritizing billing-related enforcement. As a result, the fact that your ABA center or ABA practice provides essential services is not a defense to liability—and, if your center or practice has improperly billed Medicaid, this is a serious issue that you need to address appropriately.
4. Assess Your Risk of Facing Criminal Charges for Medicaid Billing Fraud
Along with assessing their risk of Medicaid billing fraud allegations generally, targeted providers should also specifically assess their risk of facing criminal charges. Generally, to pursue criminal charges, federal prosecutors must have evidence that a provider either knowingly or willfully defrauded Medicaid.
This evidence can take a variety of forms, and the U.S. Department of Justice (DOJ) has an extensive track record of securing criminal convictions in Medicaid billing fraud cases. As a result, targeted providers must make an honest assessment of their risk exposure, and they must work closely with their defense counsel to proactively prepare for the possibility of facing allegations of knowing or willful fraud.
5. Look Beyond Risks Related to Your Practice’s Medicaid Billings for Autism Therapy Services
When targeting ABA therapy providers, federal and state authorities are not limited to scrutinizing their Medicaid billings. From improper financial relationships to inadequate supervision, authorities can target a wide range of other statutory and regulatory violations as well.
As a result, even if an investigation is initially focused on Medicaid billing fraud, it is important not to assume that the investigation will remain limited in scope. Targeted providers need to assess all potential risks and then develop their defense strategies accordingly.
6. Develop a Defense Strategy Tailored to the Government’s Investigation
Developing a defense strategy that is tailored to the government’s investigation is essential. Not only must targeted providers ensure that they address all of the allegations at issue, but they must also be careful not to inadvertently raise issues that are not currently under scrutiny. Once again, relying on the advice and insights of experienced defense counsel is key, and targeted providers should be prepared to work closely with their defense counsel throughout the investigative process. If the focus or scope of an investigation evolves over time, the targeted provider’s defense strategy will need to evolve as well.
7. Target a Resolution that Avoids Unnecessary Consequences
Finally, when defending against an applied behavior analysis (ABA) Medicaid investigation, it is important to target a specific resolution that avoids unnecessary consequences. As discussed above, whether this involves seeking to avoid penalties entirely, targeting a civil settlement, or fighting to avoid a criminal conviction will depend on the circumstances involved.
Civil investigations can turn criminal, and criminal investigations can quickly lead to grand jury indictments. Thus, time is of the essence, and providers that are facing Medicaid fraud investigations should engage experienced defense counsel to represent them right away.
