States from New York to Nebraska are cutting ABA reimbursement, and federal Medicaid changes add more budget pressure ahead. Clinics that depend on a single payer are most exposed.
For years, Medicaid was one of the fastest-growing sources of ABA revenue. That growth has triggered a backlash. As spending climbed, states began resetting rates, adding hour caps, and tightening oversight. For many clinic owners, 2026 is the year payer mix became a survival question.
What states are doing
The cuts vary widely, but the direction is clear:
- New York reduced Medicaid ABA rates by 25% in two steps, on October 1, 2025, and April 1, 2026. The technician code 97153 fell from $19.26 to $14.45 per 15-minute unit, according to Acuity News. A NYSABA and CASP survey found 74% of responding Medicaid providers said they would leave the program if the second cut took effect. In September 2026, Behavioral Health Business reported that the state is rolling out a third cut.
- Nebraska cut rates by 28% to 79% depending on service type and imposed a 30-hour-per-week cap, per Becker’s Behavioral Health.
- Indiana moved to a state-set fee schedule in 2024 and added further cuts in April 2026, aligning with a national average technician rate of about $62.80 per hour, according to Capstone DC.
- North Carolina attempted a 10% reduction that was challenged in court; the governor later ordered rates restored.
- Colorado has discussed reductions following a federal audit that found $77.8 million in improper ABA payments.
The federal backdrop
The 2025 federal budget reconciliation law (H.R. 1) adds longer-term pressure on state Medicaid budgets. According to a summary by ASTHO:
- Work requirements for many expansion adults ages 19 to 64 begin by December 31, 2026, though states can seek an extension to 2028. Parents and caregivers of a child 13 or younger, or of a child with a disability, are exempt.
- Provider tax limits in expansion states phase down from 6% to 3.5% starting in fiscal year 2028. Many states use these taxes to fund their share of Medicaid.
- State-directed payments are capped at 100% to 110% of Medicare rates.
Children’s ABA is generally covered through Medicaid’s EPSDT benefit, which the law did not eliminate. But when states lose revenue, optional rates and administrative rules are where they look for savings. Expect tighter utilization review and rate pressure to continue.
Know your exposure
Start with a simple analysis of the last 12 months:
- Revenue by payer. What percentage comes from each Medicaid plan, commercial plan, and other source?
- Margin by payer. Some payers look large on revenue but lose money once denials, admin time, and rates are counted.
- Concentration risk. If one payer is more than 40% to 50% of revenue, a single rate change could put you underwater.
- Days in A/R by payer. Slow payers tie up cash you need to make payroll.
Diversification strategies
Grow commercial contracts. Review your in-network status with major commercial and employer plans in your area. Many clinics have never tried to renegotiate rates. Bring data: your outcomes, family satisfaction, and cost per client.
Target employer plans. Large employers with self-funded plans often include autism benefits. Relationships with HR and benefits teams can drive referrals.
Consider service line mix. Diagnostics, caregiver training, social skills groups, and school consultation contracts can add revenue that isn’t tied to one Medicaid rate.
Get efficient. When rates fall, operations matter more. Tighter scheduling, lower cancellation rates, and fewer denials can protect margin.
Stay involved in policy
Rate decisions are made by people who often don’t understand how ABA works. Join your state ABA association and CASP. Share cost data when your state requests it. Build relationships with legislators before a cut is proposed, not after.
And because improper billing has fueled much of the scrutiny, strong compliance is also advocacy. Clean documentation makes it easier for the field to argue for fair rates.
The bottom line
The Medicaid rate reset is not a temporary blip. Clinics that know their payer economics, diversify their revenue, and run efficient operations will be positioned to grow as less-prepared providers exit the market. This article is general information, not financial or legal advice.