Funding for Applied Behavior Analysis (ABA) therapy has not always been provided through insurance and Medicaid. Historically, waiver programs or private pay were the primary methods for accessing care. This lack of insurance or Medicaid funding left many children without medically necessary care. Through federal mandates, Medicaid is now required to fund ABA therapy for those who meet the qualifications. As of 2022, Medicaid covers ABA treatment in all 50 states, significantly increasing access to care for children around the country. Understanding the federal and state mandates is key to ensuring your clients receive authorization for ABA therapy.

Federal mandates

The Center for Medicare and Medicaid Services released an informational bulletin in 2014 regarding Medicaid coverage for children with autism. In this bulletin, they clarified the federal requirements for the treatment of autism. They explained that Medicaid is required under federal law to fund treatments that improve the symptoms of autism, which includes ABA therapy.


This clarification on current law set forth swift action in each state to plan for this major shift. California was the first state to immediately enact changes in 2014, just months after this federal announcement. Many states took several years to make the transition. Finally, in 2022, Texas became the 50th state to begin funding ABA therapy through Medicaid.

Early Period Screening Diagnostic and Treatment (EPSDT)

The Early Period Screening Diagnostic and Treatment (EPSDT) Program was introduced in 1967 to ensure Medicaid-eligible children have access to medically necessary healthcare services. Medicaid funded this comprehensive healthcare coverage for all recipients under 21 years of age. The goal of the EPSDT was to provide ongoing screenings to identify concerns early on, followed by treatment to address any medical or mental health challenges.


The federal announcement in 2014 was in reference to the EPSDT program. Despite the program’s implementation in 1967, states did not believe it extended to autism treatment, as that was not initially clear. However, ABA and other therapies for children with autism should have been covered under this program. As such, the federal government required all states to cover ABA and other autism therapies as medically necessary treatments.


What’s covered under the EPSDT?

Regular healthcare screenings (i.e., well visits, autism screenings) are covered, as well as medically necessary treatments to correct or alleviate the symptoms of any diagnoses identified.


Other services covered under the EPSDT include:

    • Mental and behavioral health services
    • Speech and language therapy
    • Occupational therapy
    • Physical therapy
    • Dental care
    • Glasses, hearing aids, and augmentative communication devices
    • Medical equipment and supplies
Federal Mental Health Parity Law

Federal Mental Health Parity Law

Another federal law related to Medicaid funding for ABA is the Mental Health Parity and Addiction Equity Act (MHPAEA). This law requires that mental health coverage, whether Medicaid or private insurance, be no more restrictive than medical coverage. ABA falls under mental health coverage. Therefore, for individuals receiving ABA coverage, the Medicaid funding requirements cannot be more restrictive than they would be for coverage of a medical condition.


To determine whether a particular requirement violates the MHPAEA, ask whether they apply the same requirements or limitations to someone receiving treatment for a medical condition.


Quantitative Treatment Limitations (QTLs)

Per the MHPAEA, mental health benefits cannot have quantitative limits if the same limitations do not apply to medical or surgical benefits.


QTLs include

    • Dollar caps
    • Age limits
    • Hourly limits


Non-quantitative treatment limitations (NQTLs)

The Mental Health Parity Law also applies to non-quantitative treatment limitations. Mental health benefits cannot have limitations to limit the scope or overall duration of treatment unless the same limitations are equal to those set forth on medical or surgical benefits.


NQTLs include

    • Medical necessity criteria
    • Treatment plan requirements
    • Caregiver participation requirements
    • Coverage contingent on a specific level of improvement within a specified period of time
    • Fail-first requirements
    • Location or time of day requirements
    • Limitations based on ASD severity


It is vital to keep in mind that QTLs and NQTLs are only violations of the MHPAEA if the plan’s medical benefits are less restrictive than those imposed on mental healthcare (ABA included).

Meeting medical necessity with medicaid insurance coverage for aba therapy

Meeting medical necessity

Any services that qualify under the EPSDT program are only authorized if necessary to correct or alleviate a physical or mental health condition. In other words, medical necessity must be demonstrated. While ABA is a covered Medicaid service, not all children qualify.


Medical necessity is individualized and assessed on a case-by-case basis. Federal statutes don’t directly define medical necessity. The Centers for Medicare & Medicaid Services provide the following general guidelines.


Services or supplies must be

  • Needed for the diagnosis or treatment of a medical or mental health condition.
  • Provided for the diagnosis, direct care, and treatment of diagnosed conditions
  • Within the standards of acceptable medical practices.
  • Not primarily for the convenience of the patient, provider, or stakeholders.


Each state is allowed to set parameters for determining medical necessity. However, these parameters cannot contradict or be more restrictive than federal requirements. You can find a list of each state’s medical necessity definition here.



Advocating for medical necessity

The onus for demonstrating medical necessity for individual clients falls on the BCBA or other supervising clinician. Therefore, it’s essential to understand how to advocate for medical necessity.


To demonstrate medical necessity for ABA treatment, the following criteria are needed.


  1. Documentation of a diagnosis. An autism spectrum diagnosis is typically required to meet medical necessity.
  2. Evidence to support how ABA would lessen or improve the impact of the symptoms of autism for the individual.


Because medical necessity is tied to a specific diagnosis, it is often best to directly connect the child’s goals to the symptoms of autism.



Johnny will mand (request) for 5 preferred items using his Proloquo2Go app, with 80% independence, across 3 consecutive sessions, by March 2023. 0/5 items N/A (new goal) To remediate the deficits related to functional communication
Johnny will tolerate parallel play by engaging in a preferred activity within three feet of a peer for 3 minutes, at 100% accuracy, across 3 consecutive sessions, by March 2023. 0 out of 3 minutes N/A (new goal) To remediate the deficits related to social engagement

Least restrictive environment

Medicaid advocates for children to attend the least restrictive environment or the “most integrated setting.” This requirement stems from the Supreme Court case Olmstead v. L.C., 527 U.S. 581 (1999). In this case, the Supreme Court ruled that individuals with disabilities must be provided access to community-based services when appropriate, desired (or not opposed) by the individual, and when community-based services can be reasonably accommodated. There has been much debate regarding the application of this ruling. However, Medicaid has applied it to its regulations.


A least restrictive or most integrated environment is defined by the Americans with Disabilities Act (ADA) as “a setting that enables individuals with disabilities to interact with non-disabled persons to the fullest extent possible.” While not all children are ready for full-time inclusion in an academic setting at the age of attendance, BCBAs must be prepared to advocate for why full-time inclusion is not yet appropriate for the individual.

Return and denials

Getting a Medicaid return can be quite frustrating. Understanding the laws and regulations will help you to advocate for your client’s continued access to medically necessary treatment. If an authorization request is denied or returned, you have the right to request a detailed evidentiary basis for the return or denial. This includes any documentation used, research consulted, or any other guidelines they considered to make their determination.

More resources

If you are interested in learning more about Medicaid insurance coverage for ABA Therapy, the Autism Legal Resource Center partnered with Autism Speaks to provide a toolkit for Medicaid-funded ABA. The toolkit provides valuable information for both providers and families. You can check that out here.


ABA practices that offer Medicaid services can try CR Essentials for free to create payer-specific workflows that allow their entire teams to stay compliant without slowing down. CR Essentials is the vendor of choice for practices with significant Medicaid billings. Learn more about CR Essentials and start your free trial today.



Clarification of Medicaid Coverage of Services to Children with Autism. Federal Policy Guidance | (2014). Retrieved December 15, 2022, from

Nashp. (2021, June 15). State definitions of medical necessity under the Medicaid Epsdt Benefit. The National Academy for State Health Policy. Retrieved December 16, 2022, from


Statement of the Department of Justice on Enforcement of the Integration Mandate of Title II of the Americans with Disabilities Act and Olmstead v. L.C.. the official U.S. government site for Medicare | Medicaid. (n.d.). Retrieved December 13, 2022 from


U.S. Department of Labor. United States Department of Labor. (2022, December 16). Retrieved December 16, 2022, from