Private equity firms have acquired 574 autism therapy centers across 42 states since 2015. The transaction spree surged between 2018 and 2022, specifically, with nearly 80% of those investments occurring during that period.
States with higher autism rates and insurance mandates had more private equity involvement, according to new research published in JAMA Pediatrics. States that were in the top percentile of autism diagnoses prevalence had a 24% increase in the likelihood of private equity entry.
California, Texas, Colorado, Illinois and Florida had the highest rates of private equity acquisition during this timeframe. There were just 16 states that had either one or zero private equity-owned autism services.
Much of the activity has been driven by demand from rising diagnoses of autism spectrum disorder (ASD), which saw an increase from 1 in 68 in 2014 to 1 in 31 as of the CDC’s most recent data.
For years, private equity has invested in various areas of health care, including mental health, but its role in autism services was unclear until now.
“The rapid increase in PE investments in the ASD therapy market coincided with the large increase in childhood ASD diagnoses,” the study authors wrote. “PE entry was associated with ASD prevalence, but it is unclear whether entry led to increased availability of and accessibility to ABA services.”
Private equity’s involvement in health care has historically carried mixed or negative connotations as investors’ incentives can at times clash with organizational goals and lead to staff cuts, lower compensation, etc.
While providers are increasingly being pushed toward value-based care, measuring outcomes and accountability of total care costs, these investors tend to focus on volume growth and expansion, which doesn’t always align with payer expectations either.
“Given concerns about PE involvement in ASD services and other health care sectors, further study is needed to determine potential implications for children with ASD,” the authors wrote.
Heading into a new year, autism service providers predict that cookie-cutter approaches and old models will not fly in 2026. The expectations of providers and private equity investors could be affected by market uncertainties and payer demand for evidence of outcomes and adherence to standards.
For their analysis, the study authors used PitchBook to find any PE acquisition between Jan. 1, 2015 and Dec. 31, 2024 that included the key terms “autism,” “autism treatment facilities,” or “ABA services” and then manually verified the data via public information, press releases and company websites and documents.
