Private equity is the biggest player in a booming autism-therapy industry. Some therapists say the ‘money grab’ is hurting the quality of care
When Hopebridge, a nationwide chain of autism therapy centers, opened a branch in Athens, Georgia, in the fall of 2020, Sara counted herself lucky; she began sending her five-year-old daughter Zoe there almost immediately. True, the 40-hour-per-week program required strict, on-time attendance—Zoe could lose her spot after just a few tardies—but it seemed that Sara had finally found safe, quality, insurance-covered care for her daughter.
Hopebridge is a private equity-owned enterprise, and the Athens branch was part of an investor-fueled wave of expansion that would more than double its size in less than three years. And Sara was initially impressed with what Hopebridge offered.
She was reassured by what seemed like good communication. She met regularly with a Board Certified Behavior Analyst (BCBA) who oversaw her daughter’s care and coached Sara in bi-weekly parent-training sessions, and she appreciated the BCBA’s responsiveness to her frequent emails. Sara also came to completely trust the therapists who worked with her daughter every day. Over the course of 15 months, they helped Zoe reach life-bettering milestones. Zoe, who is non-verbal, became more capable in using her communication device, a tablet that displays rows of images she can press to convey her needs and feelings; she also became potty trained.
But this May, Sara got a call from Kay Murphy one of Zoe’s former Hopebridge therapists. The woman had worked with Zoe for four hours each day, until around Christmastime 2021, when she abruptly disappeared. Now, over the phone, Kay shared some disturbing information: In October 2021, she had witnessed another one of Zoe’s therapists yell at Zoe and violently yank the girl off the floor when she was having a tantrum. The incident, and Zoe’s fearful reaction, shook Kay, and that afternoon she had reported it as abuse to the center manager. In the time since, Kay explained, she had been fired. The center manager to whom she had reported the incident had left the company and been replaced.
In an interview with Fortune, Kay corroborated this account. She said she had previously received good reviews, but in the months after reporting the incident she had seen her hours drastically reduced and noticed a change in the way clinic leadership communicated with her. She eventually was told she was being fired for not following Hopebridge’s therapy program. She told Fortune she interpreted the events as retaliation for filing the complaint.
Kay had even more disturbing news for Sara: The therapist she’d accused of abuse, after initially being removed from Zoe’s schedule, was back working with the child. Kay had decided to reach out to Sara after learning of similar allegations involving the same individual and other therapists and children at the center.
Sara was stunned. She’d never been told of the incident, nor of the investigation that Hopebridge had apparently opened and closed on the matter. The call from Kay made her reconsider the bruises she’d occasionally spotted on Zoe—at the time, she’d chalked them up to her rambunctious daughter’s “tumbling and fumbling” lifestyle—and the change she’d observed in her daughter’s initially enthusiastic attitude toward Hopebridge. In recent months, Zoe had begun to ask through her device to stay home.
Within days of the call, Sara withdrew Zoe, who’s now seven, from Hopebridge. “She can’t tell me if anything is hurting on her, or if somebody’s hurting her… That’s the disturbing part,” Sara told me a few weeks later. “It’s bothered me to my core.” (Sara asked that she and her daughter be identified by pseudonyms, to protect their privacy, and other parents quoted in this story requested anonymity for similar reasons. Kay and other current and former staff members also asked for anonymity, because they still work in the industry.)
In fact, Sara would learn about many more troubling issues and incidents over the coming days. But what bothered her even more than the allegations themselves was the unserious and non-transparent way she believes Hopebridge—which runs more than 100 therapy centers in a dozen states and claims to be one of the nation’s largest providers—has handled the situation. That haunts Kay as well. “There just has to be better accountability, and more transparency.”
In a written statement to Fortune, Hopebridge founder Kim Strunk wrote, “We take all reports seriously and have zero tolerance for any abuse.” She continued, “We understand that every question and concern comes from a place of deep caring. However, we were unable to substantiate any of the [claims] through two independent investigations into the allegations in Athens, Georgia.”
Strunk did not directly respond to claims of retaliation by Athens staff nor about parents not being told about investigations, but she says Hopebridge has an anti-retaliation policy and that the company “strives to create an environment of transparency and open lines of communication with our staff and parents.”
Strunk’s zero-tolerance message notwithstanding, the allegations that surfaced in Athens appear to fit a broader pattern. In all, 10 people—a mix of parents, employees, and former employees—in four different states shared accounts with Fortune of what they believed to be unethical and sometimes abusive behavior at Hopebridge centers. In all cases, they felt incidents were not properly addressed or investigated and were instead ignored or hidden by the company.
Hopebridge’s story, in turn, fits within a larger narrative—one about breakneck growth in a lucrative, relatively new, and relatively unregulated corner of the health care world. Just a decade ago, Hopebridge was a homegrown operation providing services at just two locations in central Indiana. Its rapid expansion reflects the explosive growth of an industry built around the ever-more-commonplace diagnosis of Autism Spectrum Disorder (ASD). According to the CDC’s latest estimate, ASD is identified in 1 in 44 American 8-year-olds, compared to 1 in 150 in 2000. (This is not necessarily an apples-to-apples comparison, in part because the diagnosis has broadened considerably; Asperger’s Syndrome, for example, is now included in the ASD category.)
The allegations unearthed in Fortune’s reporting around Hopebridge—undertrained staff and high turnover, a lack of transparency and accountability, and practices that prioritize profit over the needs and safety of young people with autism—are complaints that appear to be common at some autism therapy centers. You could call these growing pains, but critics say they’ve been made worse by the pace of growth.
The engine setting that pace is a surprising one: Private equity. Hopebridge is one of dozens of companies in America’s supercharged autism services industry that have won private equity backing in recent years, in a transactional tidal wave that has involved some 200 deals since 2012. These companies and their investors are racing to fill a longstanding void in autism therapies across the country—in part because changes in health insurance rules have made such therapies particularly lucrative. Thanks to a wave of legislation since 2008, every state now mandates their coverage. But many insiders in the field fear that the race to scale is coming at a cost to the population it serves, as firms cut corners to beef up their clinics’ bottom lines.
What’s more, PE firms are also betting almost exclusively on companies that specialize in Applied Behavior Analysis, or ABA. ABA is a therapy that’s both time-intensive and highly profitable—but also a controversial one that some in the ASD community say can be ineffective and harmful to autistic people.
“Whether private equity was here or not, we would have these growing pains,” says Sarah Trautman, a BCBA who built and sold her own autism services company to a PE-backed start-up in 2019. She celebrates that insurance reform has created access to affordable services for everyone. But she adds, “It’s created a money grab, which I think has lessened overall the quality of outcomes.”
The events at Hopebridge illustrate a deepening tension in autism care. The influx of capital is expanding access to services in an arena where long, anxiety-producing waitlists are common and supply of care still falls well short of demand. But the high stakes, human-centric nature of the therapy makes its delivery a delicate and sensitive enterprise. Can the culture of private equity, with its focus on cost-cutting and profit maximization, coexist with a community whose needs are highly varied, individualized, and sometimes lifelong?
New laws trigger a gold rush
The world of autism therapy looked very different when Kim Strunk founded Hopebridge—then known as Homefront Learning Center—in her hometown, Kokomo, Indiana, in 2005. An occupational therapist, Strunk recognized that families with autistic children were poorly served by a fragmented care ecosystem, often having to run around town to visit multiple different local providers. To better serve clients, Strunk’s idea was to bring everything under one roof in a single center, including speech and occupational therapy—as well as ABA.
ABA is singularly intensive, enlisting children as young as 15 months in one-on-one programs that often run from 25 to 40 hours per week. Today, the individualized therapy—which teaches behaviors and skills, often through repetition and a system of reinforcements—is one of the nation’s dominant autism interventions, but at the time it was not accessible for most families.
Aside from in Hopebridge’s home state of Indiana, insurance coverage for autism therapies including ABA, was virtually non-existent. Instead, services for children were generally limited to what was provided by public programs, or what parents could afford out of pocket. For the sort of intensive therapy Hopebridge offered, one had to pay enormous sums.
That struck Lorri Unumb, a lawyer with a severely autistic son, as wildly unfair. When she and her lawyer husband learned of ABA’s $70,000 annual price tag in the early 2000s, the couple relocated from Washington, D.C. to less expensive South Carolina to help defray the cost. With ABA, their son’s behavior became less disruptive, and he quickly learned skills like how to hold a utensil. (Unumb says he still receives ABA today, almost two decades later, and continues to make significant gains that reduce his disability.)
Other families, Unumb knew, didn’t have the same resources, and in 2007 she led a grass roots effort that led South Carolina to mandate coverage of ABA. Unumb then joined forces with the advocacy group Autism Speaks to push for insurance reform across the country. Today, the national landscape is completely changed; though the details of these mandates vary by location, ABA therapy for autism is now covered by insurance and Medicaid in every U.S. state.
That change has revolutionized access to autism services in America, making early intervention affordable for families. The shift, reflected in a recent CDC-led analysis, is striking: Per-child spending by employer-sponsored health insurance plans on young children with ASD increased 51% between 2011 and 2017 (over the same period, spending increased just 8% for kids with no ASD diagnosis). Annual per-child spending on intensive behavioral therapy, i.e. ABA, increased 376% in that period, from $1,746 per child to $8,317 per child; for 14.4% of kids with ASD, spending on that therapy in 2017 exceeded $20,000.
As such numbers suggest, insurance reform turned ABA into a big business. The mandates unleashed a gold rush, with large investors working to consolidate the fragmented provider landscape and build up regional platform companies specializing in the expensive, time-consuming therapy. “It’s like vultures now,” says Michi Medley, an Oklahoma-based family advocate and autism professional. “All these companies are coming in, and there’s so many of them, families don’t know who’s who.”
Between 2012 and 2021, the Braff Group, a health care M&A Advisory firm, identified 223 deals done in this sector. Nearly 90% of transactions over the past five years have involved private equity, according to the firm’s proprietary analysis; what Braff calls the most “frenzied” period, from 2017 to 2019, was characterized by PE firms buying up ABA providers at 10 to 15 times their annual profits: Big names like Blackstone, KKR, TPG, and Cerberus have all made investments in the space. One of the Braff Group publications compared investor enthusiasm for autism services to that of “fan boys to the latest Star Wars release.”
But many people in the community—including industry veterans, researchers, and autistic people and their families—question whether ABA has earned the industry’s decisive embrace. Its early history as an autism intervention is rooted in controversy—one of its pioneers in the ‘60s used a battery-charged cattle prod as a form of negative reinforcement, for example—and many note that overstated claims helped propel it to prominence. (In the past, ABA has been falsely promoted to as “the only thing you can do for your child,” notes Christopher Banks, President and CEO of the Autism Society of America.)
In fact, there’s a whole array of therapies and services to support autistic individuals, Banks adds. ABA, itself, has varied approaches, from traditional to more naturalistic ones. What’s most effective, for whom, and in what quantity, is a matter of contention, says David Mandell, a professor of psychiatry at the University of Pennsylvania School of Medicine. “We don’t have a strong evidence base for the best inventions for kids with autism.” That’s because research studies historically have been small and produced limited insight.
Certainly, ABA works well for some kids, but not all of them—an outcome that experts say is logical given the breadth and heterogeneity of autism. (A common saying in the community is, “If you’ve met one person with autism, you’ve met one person with autism.”)
“There are a lot of different needs,” says Connie Kasari, a professor of education and psychology at UCLA who developed a play-based intervention called JASPER, and who serves as president of the International Society of Autism Research. “To think that one intervention is going to be best for everyone is insane.” She’s among those that worry the industry has picked a winner in a narrow brand of ABA at the exclusion of other therapies; like others sees the industry’s current direction being more “driven by money” than evidence.
There’s also tension between the fast-growing autism intervention industry and some in the community it purports to serve. In 2021, the Autistic Self Advocacy Network, an influential organization of autistic people, published a white paper, “For Whose Benefit? Evidence, Ethics, and Effectiveness of Autism Interventions,” arguing against interventions including ABA, that it says try to “normalize” autistic individuals—forcing them to learn to make eye contact, for example, or stopping behaviors like hand flapping. The paper compares the practice to conversion therapy—which aims to change an individual’s sexual orientation, and which is banned in many states—and describes ABA, based on the testimony of autistic adults, as harmful and traumatic.
Others in the community, are more equivocal about the therapy. Joy Johnson, who is autistic and went through ABA as a child, now works as a behavior analyst in Maryland. She says of her experience, “I’m in the field because I do feel like ABA is beneficial to our population…I got a lot of benefits from it, but I did receive a lot of harm.”
She thinks of ABA as a neutral tool that has often been misapplied. In her own case, she says being trained to be compliant set her up for unhealthy social relationships and made her vulnerable to exploitation and abuse as she got older. That informed the “reform” ABA approach she uses with clients: Rather than working to change their autistic behaviors, she focuses on self-advocacy skills and “helping them navigate the world authentically as they are.”
Johnson is part of a broader community that is working to remake ABA by incorporating the autistic perspective and experience. But the extent to which this conversation is trickling down to Autism Inc, is hard to tell. The clearer dynamic in this marketplace, long defined by scarcity, is that big investors see a future of extraordinary growth.
Fast-growing and short-staffed
The first sign of Hopebridge’s big ambitions came in 2016 when Dennis May, the CEO of the regional appliance giant HHGregg, took the reins of the autism-therapy provider from Strunk and announced plans for “significant” multi-state expansion. A round of financing and an investment by Baird Capital powered the first phase of growth. Then in 2019, when it had roughly 40 locations in a handful of states, Hopebridge sold itself to the private equity firm Arsenal Capital Partners, in a deal that valued the company at $255 million according to PEHub.
Under new ownership, Hopebridge’s expansion barely paused for the COVID pandemic: Hopebridge has opened dozens of new autism centers (including the one in Athens) and acquired dozens more. Today, the company’s 100+ locations employ nearly 5,000 people who work with thousands of autistic children. May has said that gangbusters growth will continue: The company plans to hire 4,000 more employees and reach 140 centers by the end of 2022.
In a statement provided to Fortune, Strunk, whose title is now Chief Clinical Strategy Officer, credited Arsenal’s partnership for allowing Hopebridge to expand its services to underserved communities and to focus on improving the clinical quality of autism care. Fortune reached out to Arsenal and a number of other private equity firms active in the space; Arsenal did not respond and the others either did not respond or declined to comment. (No former clients or former staff of Hopebridge implicated Arsenal in problems there.)
Strunk is among those in the field who argue that private capital is helping to professionalize what has long been a mom-and-pop industry. “It’s easier to start an ABA therapy clinic in most states than a nail salon,” says Sara Gershfeld Litvak, a veteran provider who founded the Behavioral Health Center of Excellence seven years ago to try to raise the bar on quality in the field. Her organization offers accreditation for ABA providers—something most insurers and payers don’t yet require—and she has found investors so far to be “very rule-governed” and supportive of industry standards. (Hopebridge was accredited by the organization earlier this year.) Litvak is also a co-founder of the Autism Investment Summit, and she believes private equity’s interest in the field reflects the financial sector’s increasing focus on socially impactful investments.
But many people Fortune spoke with emphasize a different impact of private-equity ownership: pervasive profit-maximization. Several sources contend that PE-backed therapy centers prioritize billable hours—those in which children receive ABA therapy, and for which companies are reimbursed by insurers or Medicaid—over other needs of their clients. “What [some are] putting their money behind are just clinic mills,” says Pablo Juárez, Co-Director of the Treatment and Research Institute for Autism Spectrum Disorders at Vanderbilt University Medical Center. “It feels like they’re building clinics just to get kids through.”
Services at some of the fastest-growing ABA companies are reserved for young children; critics say that’s in part because the young are most likely to be approved for the 40 hour/week schedules that represent the greatest billing potential. Hopebridge, for example, specializes in kids age 10 and under, and staff and parents told Fortune that they believed the company’s fastidiousness around scheduling is about money.
When Katie Swann, a restaurant worker in Bardstown, Kentucky, finally got a spot for her autistic son at a Hopebridge in Louisville, a 45-minute drive from her home, she proposed a three-day-a-week schedule for him, given the intensity of the therapy and daily commute. But Hopebridge staff “told us essentially if [he] doesn’t come here five days a week, someone else’s kid will,” Swann says. And even after enrollment, Hopebridge’s policy threatens to remove kids from their programs if they miss 10% of the year’s classes or are too often tardy or absent without sufficient notice. (Swann’s son eventually lost his spot after too often being late.)
ABA therapists who worked for Hopebridge in multiple states spoke of pressure to reduce or altogether stop allowing their young clients to have naps, breaks, or any interruption that would result in missing out one of the day’s billing periods, since companies are reimbursed by insurers in 15-minute increments. Zoe’s schedule allowed for a 15-minute lunch, while one former employee in Kentucky was told to restrict naps to 10 minutes or less. (Some ABA companies, independent and investor-backed, have settled charges with the government for billing during such periods, since such billing is considered fraudulent.) The same former employees also believed center management would not send sick or injured children home, or close during power outages or inclement weather, for the same reason.
Hopebridge’s Strunk wrote to Fortune, “This intensive treatment model does require consistent, sustained attendance for children to be successful.” She adds that Hopebridge refers those who can’t meet the company’s requirements, or those who don’t demand that intensity of service, to other providers. Nap schedules are determined on an “independent clinical basis” and if a child falls ill at the center, a supervisor determines whether the child needs to be sent home, she says.
Jon Bailey, a professor of psychology at Florida State University who has written multiple ABA ethics textbooks, initially thought the influx of investment into his field was a good thing. But Bailey also runs a free ABA ethics hotline, and he says he now gets 10 to 20 questions a day, most of them from worried professionals asking about some concerning practice at an ABA company that’s been bought up by private equity—billing fraud, cuts to training and supervision, requiring therapists to provide more ABA than clinically necessary. In recent weeks, he’s heard from staffers working at investor-backed companies that have shut down services practically overnight, giving no warning to families. “It’s not a good situation,” he says, adding that what employees are being asked to do isn’t to improve quality but to boost “the bottom line.”
To enhance profits, Bailey says, clinics are taking on too many clients, doubling up children on therapists, and overloading supervisors with cases. Lorri Unumb, the parent advocate who now serves as CEO of the Council of Autism Service Providers (CASP), remembers being dumbfounded when an industry investor boasted that his company hired a supervising therapist for every 40-50 patients (10-15 is the industry standard). Having been so involved in the advocacy that created the industry’s funding stream, Unumb now feels responsible to ensure quality in the industry. “These kids don’t get a do over,” she says. “You can’t just put a shoddy program out there and waste these children’s most important window to change the trajectory of their lives.”
Another urgent question is whether the autism-therapy workforce is trained and equipped to deliver effective care. The ABA industry heavily relies on two categories of workers: Board Certified Behavior Analysts (BCBAs)—the graduate level professionals who design and oversee a child’s ABA program—and Registered Behavior Technicians (RBTs), the industry workhorses who implement the therapy and work with autistic children many hours a day. RBTs, who are sometimes called ABA therapists, get 40 hours of training for the job, and are supposed to be supervised for 5% of their hours.
In general, the workforce is very young and inexperienced. As of July 2022, there were 57,000 BCBAs in the country, up from 20,000 in 2015, along with 120,000 RBTs, all of whom have been certified since 2014 when a professional certification program was created.
The varied readiness and competence of this workforce worries Erick Dubuque, director of the Autism Commission on Quality, a non-profit accreditation body for organizations offering ABA services. “We have a real serious issue with our training programs,” he told me, explaining that many programs get away with offering the “bare minimum,” despite the vulnerability of the population workers will be serving, because of high demand in the field. In a 2020 study, Dubuque and colleagues identified more than 20,000 additional providers that claim a BCBA credential but don’t actually have one. Individuals who work in the field and spoke with Fortune shared concerns about feeling ill-equipped for the job, which sometimes involves managing difficult situations where they might be kicked, hit, or bitten by a combative child. Others commented on a lack of professionalism among their colleagues, sharing stories in which therapists made fun of their clients’ autistic behaviors.
Perhaps because insurers and employers are paying rapidly expanding sums for autism services, there is a growing focus on care quality and tracking outcomes in the industry. A number of PE-backed companies, including Hopebridge, are supporting those efforts, though people involved acknowledge that it’s hard to articulate what outcomes should be and how to measure them. What everyone seems to agree on is that the field has enormous room for improvement.
'People who are doing the legal and ethical things are getting fired'
When Sara first approached the Hopebridge center manager in Athens about the alleged abuse of Zoe, she asked with an open mind. “I know there are two sides to every story,” she told me. But the brief interaction, during the morning drop-off at the center, left her only more troubled. The manager had revealed the name of the accused therapist, but then dismissed Sara’s concerns, telling her that raising them would jeopardize the therapist’s job. Sara asked to meet formally with the manager, with an advocate present, and the manager referred her to Hopebridge’s compliance department in Indiana. Sara says the compliance representative seemed more intent on convincing Sara to send Zoe back to Hopebridge than on investigating her concerns. (She hasn’t heard back from the representative since.)
At the same time, the network of parents and therapists at the Athens Hopebridge began exchanging information. A parent reached out to Sara to say that months before she’d filed a complaint with the center after her autistic child came home talking about the rough way Zoe had been treated. And therapists who had started comparing experiences began reaching out to other families informing them of similar incidents involving their children. Like Kay, they’d decided to do so, after feeling their efforts to report aggressive and unethical staff behavior to center management had gone nowhere.
Day La S., who worked as an RBT at the Athens center for more than a year, says she repeatedly witnessed incidents that troubled her—fellow therapists being physically and verbally aggressive with clients and often behaving unprofessionally and unethically on the job, openly swearing and deriding client behavior. Nothing changed when she raised these issues, she says; in one instance, she watched the center manager throw her write-up of concerns in the trash. Day La was fired this April, and she wrote to Strunk days later: “I don’t think it’s right that people who are doing the legal and ethical things are getting fired while the people who are abusing these children still work there. I honestly would love to see Hopebridge [do] the right thing and investigate these reports.”
Fortune spoke with four current and former employees of the Athens Hopebridge, as well as another parent, who shared information about the broader allegations of staff behavior. Those alleged incidents included a therapist throwing a tablet at a child, a child being injured while a therapist was distracted on their phone, and staff members eating pot brownies on the job. The other parent, Tamara, learned that her 3-year-old son had allegedly been grabbed aggressively in an incident that she was told was reported by a former Athens staff member to Georgia’s Division of Family and Child Services. (The agency did not respond to efforts to confirm the report.)
Employees still working at the center spoke of being afraid to raise further concerns for fear of losing their jobs. Fortune was provided detailed emails that employees, including Day La, sent to Kim Strunk; they were appealing to Strunk because local staff never appeared to properly address the reported incidents. Those emails do not appear to have resulted in any disciplinary action. (Individuals implicated in these events did not respond to Fortune’s efforts to contact them.)
In her emailed statement to Fortune, Strunk says that Hopebridge investigated and found the allegations of abuse to be unfounded. She writes that “all of our therapists are required to complete Safety Care Training, which provides them with the skills and competencies necessary to effectively prevent, minimize and manage behavioral challenges with dignity, safety and the possibility of change.”
Strunk forwarded Day La’s email to Hopebridge’s compliance department and she received a prompt response asking to set up a call. Day La responded a couple days later, and followed up again, but says she never again heard from the representative. Tamara, the Athens parent, says she lost patience trying to get answers from Athens management and the company’s unresponsive compliance department. She had once marveled at the language skills her son developed under the company’s care. This May, she withdrew her son from his program.
Fortune spoke with parents in two other states, Arizona and Indiana, who withdrew their children from Hopebridge after suspecting their children had been abused or neglected in the company’s care. In one case, a parent, Meghan H. says her son Wyatt, who Hopebridge had previously potty-trained, was repeatedly sent home from the Litchfield Park, Arizona center without underwear and wearing other children’s clothing and shoes. (One day he was barefoot.) She was never given a satisfying explanation, nor were her son’s own clothing items returned. (Strunk says parents are asked to provide an extra set of clothes in case accidents happen, and that “if multiple accidents occur in a day, we may use a spare change of clothing at the center.”)
One common thread among the Hopebridge complaints is a lack of transparency and accountability: Complaints go unanswered; if problems emerge, explanations aren’t forthcoming. The Athens staff and parents that Fortune spoke to said that Hopebridge had never notified them, one way or the other, about the existence or outcomes of investigations that Strunk refers to in her statement. Every parent I spoke with argues that cameras should be in the centers, to monitor staff. Strunk says that Hopebridge does not have cameras because capturing therapy sessions on camera would violate patient privacy laws.
Strikingly, the same parents and employees also spoke with admiration about the many dedicated and tireless employees at Hopebridge, and the positive outcomes they’d seen in children as a result of the services the company provides.
But they also saw a company so focused on growth that it couldn’t, and wouldn’t, manage the many problems that came with it.
Sign up for the Fortune Features email list so you don’t miss our biggest features, exclusive interviews, and investigations.