Arizona Autism has announced it will lay off nearly 3,000 employees, transitioning some portion of them to contract positions.

The Phoenix-based applied behavior analysis (ABA) and intellectual/developmental disabilities services provider told employees and disclosed to the Arizona state government that it provided notice to employees on Oct. 30. Information published online by the state shows that the move impacted 2,792 people. 

Multiple requests for comment have not been returned.

Details remain sparse regarding the type of roles that will be impacted. Federal law requires that mass layoffs be disclosed in writing and detail the number and job title of employees impacted, the date of separation, whether or not the separation is permanent, and whether or not a union and bumping rights are involved. The Arizona state agency has not returned what records it has from Arizona Autism, disclosing the development.

Arizona Autism operates four ABA centers, in-home pediatric supporting care, in-home therapy, group homes and developmental homes.

Ryker Martin, the CEO and co-owner of Arizona Autism, said in an unlisted YouTube video that the company is transitioning all of its home- and community-based services workers to contractors. Such a move eliminates the company’s many obligations to employees and to pay certain taxes. Together, these include paying taxes for Medicare and Social Security, providing health care benefits, following minimum wage laws, overtime laws and workers’ compensation insurance payments.

It’s not clear how many of the nearly 3,000 impacted employees will have their status reworked and how many are simply eliminated from the Arizona Autism workforce.

Martin points to an austerity measure by the Arizona state government that reworks how and how much services disabled people can get on the state’s dime. According to local reporting, these moves are not a true cut to budgets for services. Rather, reworking the assessment standards will result in $133 million less spent on services. 

“In response, we are updating our structure to align with the state level and federal requirements, while ensuring that your work continues in a way that benefits you and the individuals that you serve,” Ryker said.

He added that he would recommend that the employees-turned-contractors engage with tax professionals to assess how they could benefit from the change in status, effectively pushing them to become entrepreneurs and owners of their own businesses.

The changes will come into effect in January 2026.

Despite the increased need for youth-focused behavioral health and related supportive services, there have been several care providers that have struggled to find sustainable models to serve this community. Underpayment lies at the heart of many organizations’ challenges.

In the case of Arizona, the state government has seen supportive services balloon for vulnerable populations, such as children with severe disabilities that need daily support for basic needs. In some ways, the pattern of huge increases in benefit use, spending exploding and government austerity follows a familiar pattern for autism therapy organizations. In Medicaid, states such as Nebraska and Indiana have responded to huge increases in ABA service costs by limiting hours and reimbursement rates.

These budget constraints come even before a looming wave of reforms could put even greater pressure on behavioral health providers that work with state agencies. The One Big Beautiful Bill Act introduced several changes to Medicaid enrollment and redetermination and slashed several health care-related programs.