HHS OIG: Colorado Medicaid Improper Payments for ABA Services

HHS OIG Reports & Publications

Filed February 25th, 2026

Detected March 2nd, 2026

Summary

The HHS Office of Inspector General (OIG) found that Colorado made at least $77.8 million in improper fee-for-service Medicaid payments for Applied Behavior Analysis (ABA) services provided to children in 2022 and 2023. The OIG recommended Colorado refund $42.6 million to the Federal Government and improve guidance for ABA providers.

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What changed

The HHS Office of Inspector General (OIG) has issued a report detailing significant improper payments by Colorado's fee-for-service Medicaid program for Applied Behavior Analysis (ABA) services. The audit covered 2022 and 2023 and found that all sampled enrollee-months contained improper or potentially improper claim lines, totaling at least $77.8 million in improper payments. The OIG specifically recommends that Colorado refund $42.6 million to the Federal Government, enhance documentation and billing guidance for ABA facilities, and conduct regular postpayment reviews.

Colorado has agreed with most recommendations but disagreed with one, while partially agreeing with another. Regulated entities, particularly ABA providers in Colorado, should review the OIG's findings and recommendations to ensure compliance with documentation and billing requirements. State agencies involved in Medicaid oversight should implement the OIG's recommendations to prevent future improper payments and ensure the integrity of the ABA services program. While no specific compliance deadline is stated for the state's actions, the findings highlight the need for immediate review and potential adjustments to billing and documentation practices.

What to do next

Review OIG report findings on improper ABA payments in Colorado.
Ensure all ABA billing and documentation practices comply with federal and state requirements.
Implement enhanced documentation and billing guidance for ABA services.

Penalties

Colorado recommended to refund $42.6 million to the Federal Government.

Source document (simplified)

Colorado Made at Least $77.8 Million in Improper Fee-for-Service Medicaid Payments for Applied Behavior Analysis Provided to Children

Issued on

02/25/2026

| Posted on

03/02/2026

| Report number: A-09-24-02004

Report Materials

Why OIG Did This Audit

Applied Behavior Analysis (ABA) is a therapeutic approach for managing the symptoms of autism and other developmental disabilities, usually centered on improving social and communication skills.
In the past several years, Federal and State agencies have identified questionable billing patterns by some ABA providers and payments to providers for unallowable ABA services.
Colorado’s fee-for-service (FFS) Medicaid payments for ABA in 2019 were $60.1 million, and by 2023 these payments had increased to $163.5 million.
This audit examined whether Colorado’s FFS Medicaid payments for ABA for 2022 and 2023 complied with Federal and State requirements.

What OIG Found

Colorado’s payments for ABA did not fully comply with Federal and State requirements. All 100 sampled enrollee-months included payments for 1 or more claim lines that were improper or potentially improper.

What OIG Recommends

We made five recommendations, including that Colorado refund $42.6 million to the Federal Government, provide additional guidance to ABA facilities for documenting and billing ABA, and periodically perform a statewide postpayment review of Medicaid ABA payments to educate providers on requirements. The full recommendations are in the report.

Colorado disagreed with one recommendation. Colorado agreed with three recommendations, partially agreed with one recommendation, and detailed steps it has taken and plans to take in response to our recommendations.

Report Type Audit HHS Agencies Centers for Medicare and Medicaid Services Issue Areas Financial Stewardship Non-institutional care Target Groups Children and Families Financial Groups Medicaid