Colorado may have to repay the federal government from $60 million to $150 million after auditors found the state Medicaid program has been covering care by uncredentialed behavioral technicians for children with autism.
The financial hit comes as the state is already dealing with a $1 billion budget shortfall and cuts to Medicaid benefits that have affected multiple programs for people with low incomes and disabilities.
Colorado is among several states whose programs were audited by the Office of the Inspector General. The audit is not final and the results are not yet public, but officials at the state Medicaid division said they are expecting that the state will have to return the federal portion of the state-federal benefit program.
“If OIG maintains their stance in the final audit report, Colorado will be required to repay the federal match identified in the report, which essentially means that all of those services that were billed and paid for will be paid only with state general fund,” said Rachel Entrekin, legal director for the Colorado Department of Health Care Policy and Financing, which includes the Medicaid division. “We’re right in the middle of a state budget crisis.”
Medicaid officials said they were unaware until they saw a draft of the audit how many uncredentialed technicians are providing pediatric behavioral therapy at autism centers in the state. They said they began warning centers, including Soar Autism Center and Action Behavior Centers, last summer that their behavioral technicians needed to get credentialed.
The therapy, called applied behavioral analysis, uses playtime and step-by-step repetition to improve communication, attention span and life skills. Autism centers that provide the therapy have increased in Colorado in recent years as the number of people diagnosed with autism has grown.
Colorado has more than 6,600 certified technicians and an estimated 1,500-2,000 who are not certified but are providing therapy. Certification requires a 40-hour course, a written test and on-the-job supervision.
Autism therapy providers packed a meeting this month in which Medicaid officials asked for an “emergency rule to address urgent compliance issues,” and to ensure children’s safety and the future of federal matching funds. State officials asked the 11-member Medical Services Board to create a rule requiring credentials for behavioral technicians, who now are not subject to background checks, qualifications or supervision.
“It was not the intent of the department to pay for uncredentialed technicians to provide services to our members,” Medicaid officials wrote in their request for a new rule. “This creates health and safety risks in addition to financial risks.”
The Medicaid-covered therapy totaled $287 million last fiscal year, a 45% increase from $207 million the year before, and up from $157 million two years ago.
“That trajectory is not sustainable for the state and ultimately puts this benefit and others at risk,” said Rachel Larson, a compliance and policy advisor for the health care department.
Preliminary audit findings suggest the state could be forced to repay $60 million to $150 million to the federal Centers for Medicare and Medicaid Services because uncredentialed technicians were reimbursed by Colorado Medicaid, and because of “improper service documentation and billing for unapproved services,” state officials said.
Autism centers say they need time to train workers
Therapy providers told the Medical Services Board they need a grace period after hiring staff technicians to get them certified and warned that enacting the emergency rule would risk causing long-term harm to children with autism.
About 25% of the workforce in the autism therapy industry is in training, said Bryan Davey, vice president of public policy and advocacy for Action Behavior Centers. He said autism providers called the Office of the Inspector General themselves and learned that states are allowed to enact grace periods during which time uncredentialed technicians can work.
“We can’t hire people fast enough to meet the need,” he said. “We are going as fast as we can. We want them to be certified, but you’re asking us to jump through a hoop that we cannot reach. It’s like asking me to slam-dunk a basketball — I cannot do it no matter what you offer me or what you threaten. You can barely get a credit card under me.”
Action Behavior Centers, which has several locations in Colorado, requires its new technicians to get certified within 120 days of being hired, he said.
In response to hours of public comment and questions from the Medical Services Board about a staff training grace period, Medicaid officials pulled back their request for an emergency rule change this month and said they would resubmit it at a later meeting, possibly in January.
Autism centers have said it’s already too expensive to operate in Colorado because the state’s Medicaid reimbursement rates are too low to cover their costs. Waitlists for therapy grew when several providers left the state in 2022 and 2023.
Medicaid officials, however, have countered that increasing costs are in part the result of autism therapy centers’ for-profit business models. Some of the largest companies are funded through private equity.
In September, autism therapy providers sued Colorado, alleging the state was violating the law by requiring them to get pre-authorization from Medicaid before providing a service. The lawsuit is ongoing.