Throughout 2025, the autism services market has seen healthy investor interest, but as reimbursement rates vary significantly, merger and acquisition activity continues to be driven by markets with favorable rates.

That, coupled with heightened expectations around compliance and regulation, is driving industry insiders to anticipate an uptick in consolidation for the year ahead. 

As the industry shifts from volume-based models to value-based care, both payers and investors are increasingly focusing on providers that demonstrate their outcomes, track data, and innovate in care delivery. 

Smaller-scale providers and practices, in particular, will have their work cut out for them in 2026. While all practices will be faced with pressures from payers and investors requiring more — and simultaneously maintain compliance with new federal regulations — small providers could throw their hands up, saying it’s “too much to do on their own,” Jason Slocum, managing director of sustainable investing at Goldman Sachs Alternatives, said during Behavioral Health Business’ Autism Investor Summit East.

“We could see some of these requirements from payers actually start to spur some consolidation activity in small markets where requirements around documentation, compliance audits, billing and coding audits, the need for technology investments might overwhelm a single BCBA or a small founder-owned practice,” Slocum said during AIS East. “I think that’s where you might start to see either new business models emerging or there might be forced consolidation of some of those very small practices.”

Goldman Sachs Alternatives is the investment company’s alternative investments division that manages assets in private markets.

Even if they are doing everything the right way, small practices might still need more resources to align with the demands of documentation and reporting to stay compliant, Slocum explained.

Navigating the increased demands from payers is no small feat, regardless of the size of a practice. Over the last few years, many providers have opted out of TRICARE, the primary health plan for military members and their families, due to increased compliance requirements, according to Dan Beuerlein, the managing director of Brentwood Capital Advisors.

“TRICARE was a hot place for folks to be,” Beuerlein said during AIS East. “Folks were chasing the bases in the early days, and that has caused some…not necessarily, consolidation of those individual practices, but it’s moved the clients around to the providers that are sophisticated enough to be able to handle those requirements. So it’s kind of a byproduct of that.”

Brentwood Capital Advisors is a Nashville, Tennessee-based M&A advisory firm that specializes in health care.

Investors and acquirers are also likely to scrutinize payer mix, sustainability and margins more closely as more autism therapy providers shift away from the traditional of 30-40 hours per week of applied behavioral analysis (ABA) per patient to more individualized, multidisciplinary approaches.

Against that backdrop, “compliance has to be in the fabric of the organization,” to sustain operational success going forward, Scott Semmel, senior vice president of payor relations at Acorn Health, said during AIS East.

“[Compliance] makes your job easier negotiating with the payer,” Semmel said. “When you can go in and say you’re taking all these protective measures to make sure you know you’re a trusted provider again and align on how we’re prescribing hours. It’s not a standard across just 30 to 40 hours for every single patient that comes in. Compliance is definitely at the core of that, and I think it’s imperative to make sure the processes are consistent throughout the entire organization.”

Acorn Health providers ABA therapy and other autism services across locations in seven states.

Since the stability of reimbursement rates directly impacts a provider’s margins, both investors and payers will look for health in the underlying rates and be wary of markets where rates may be unsustainable or are likely to be cut, panelists agreed. Ongoing fragmentation of the autism therapy market in general may also be a barrier to some market activity in 2026.

“Consolidation is going to continue to evolve,” Beuerlein said. “I think it will remain fragmented for quite a while there. What drives fragmentation really in any industry — or the opposite of that being consolidation in an industry — are barriers to entry and a high regulatory environment.”

Across more mature sectors of health care, Beuerlein said, regulation does generally force consolidation more than any individual payer dynamic, which is something providers should brace for in 2026.

Slocum agreed, but noted that as Goldman Sachs Alternatives seeks to expand its portfolio by looking for deals in the autism therapy market across new states, the path sometimes is organic, but M&A activity can help investors access better reimbursement rates.

“We have the transparency data now where we can see what every provider in the market is getting,” Slocum said. “Many payers in certain markets have closed their networks in response to the increase in demand. One of the things we’re thinking about is if we actually need to do a little bit more M&A to access contracts and access rates that if we tried to go in organically, we might not get.”

However, when it comes to data, a challenge for autism therapy providers that continues to be a thorn in the industry’s side is the lack of a collective agreement on data and which metrics matter for value-based contracting.

That may become harder before it gets better, Semmel predicts.

“I think as we continue to refine value-based quality, and we land on some additional points, aside from access to care, quality of care, then that is going to become easier,” Semmel said. “Certainly, things will become harder before that happens in terms of the hardship. I think there’s a number of things going on. Some of the tactics that providers are employing that are driving up costs — like non-participation — is really hurting some of the payers and making it more difficult for negotiations on the other side.”

The absence of agreed-upon industry standards and quality metrics is not just a challenge for providers and investors; it’s a headache for payers, Slocum said.

“I think we still have a problem in the industry with lack of standards, lack of common measurements, and an incredibly heterogeneous population across the acuity spectrum that is making it hard right now to risk adjust for anyone, payers included,” Slocum said. “ABA is so rich when it comes to data collection, but I think standardizing that data risk, adjusting that data and benchmarking accurately is going to be a lot more challenging than a lot of payers and providers anticipate.”

From an advisory perspective, Beuerlein suggests that providers who are interested in raising capital or going to market in this environment of higher scrutiny, payer negotiations and tighter margins pay close attention to their compliance framework and build strengths around that. 

He also recommends, having, at a minimum, a framework for clinical data tracking as technology becomes an even more powerful tool across health systems. In conjunction, providers have to be ready to communicate what their metrics are and how they define and measure quality.

“For those lower middle market participants or those that are looking to get to a transaction or PE point, the message is you have to build your organization around a compliance framework, a quality, metrics-driven framework,” Beuerlein said. “Where in the past that was secondary… we want to pay for value, but the ability to kind of define what that value is has taken us a while to get to and there’s still not a consistent system. We should pick three to four things tops that we should measure, and that’s the start of the dialog and finding quality and measuring it and then you’ll continue to add to that over time.”

That, he said, is “paramount” to any organization building their foundation on quality.

Semmel echoed this, noting that providers in the autism therapy space who can’t communicate this to investors or payers have already “failed.”

“In terms of the dealmaking, the pressure is first on the identification of what is important,” Semmel said. “But I think there’s got to be a lot more conversation and building a relationship with the payer. If you’re going into a conversation about reimbursement, and you’re reintroducing yourself as an organization, the payer strategy has failed. So I think that is super important. And so is developing trust and transparency as well where you’re starting to share data with each other.”

Heading into 2026, providers with novel care models and enhanced family participation in care will be a trend to watch as those who engage in doing so are also likely to help reduce costs and improve quality, Semmel added.

“When you talk about the family caregiver models that are now taking off in the pediatric private duty nursing space, I think that a model like that will be considered more and more in autism,” he said.

However, as new models like this emerge, it may still take time for payers to catch up and realize the benefits, Slocum expects.

“I’m not an ‘either or’ versus traditional ABA therapy,” Slocum said. “I think there are a number of emerging modalities that can help. … I think we’re going to see models that complement direct therapy, so that the direct therapy can be most effective. But when you go state to state or payer to payer, I think the payers broadly have a lot of catching up to do in the way that they think about reimbursement for some of these alternative levels.”