California Medicaid ABA in 2026: A Pending Rate-Setting SPA, a New Direct-Billing Pathway, and the Regional Center Question

Key Takeaways

• A separate federal IHSS funding freeze adds backdrop uncertainty but does not directly affect BHT: CMS announced on May 14, 2026 the suspension of $1.1 billion in federal Medi-Cal funding tied to California’s In-Home Supportive Services (IHSS) program over fraud-integrity concerns, plus an additional $200 million in withheld administrative claims. State officials say IHSS services will continue uninterrupted. The action does not target the Medi-Cal Behavioral Health Treatment (BHT) benefit or SPA 25-0028, but it raises the federal-state temperature in which the pending rate-setting SPA is being reviewed.
• SPA 25-0028 remains pending CMS approval as of May 2026: DHCS proposed the rate-setting amendment with a July 1, 2025 effective date, opened public comment through September 29, 2025, and submitted to CMS. The Medi-Cal fee-for-service rates file, as of April 15, 2026, still lists the core BHT codes (97151 through 97158) with no published statewide reimbursement amount.
• California built its proposed rates off the highest Regional Center rate: DHCS’s August 2025 addendum confirms the methodology: because Medi-Cal pays at the same rate statewide, DHCS used the highest Regional Center rate that DDS pays for BHT services as the rate-setting benchmark. The methodology produces some of the higher Medicaid ABA rates in the country.
• The proposed structure tiers by provider type, not by code: Rates differentiate across QAS Provider, QAS Professional, and QAS Paraprofessional, with most direct-service codes paying $40.81, $20.45, and $19.39 per 15-minute unit respectively.
• SB 874 is moving through the Legislature in parallel: The bill, introduced by Senator Akilah Weber Pierson, would require DHCS to convene a BHT stakeholder workgroup, mandate background checks for certain BHT providers by July 1, 2027, and require release of clinical guidance by January 1, 2028. The Senate Appropriations Committee passed the bill out of its suspense file on May 14, 2026, on a 7-0 “Do pass” vote, advancing it to the Senate floor.

California’s Medi-Cal environment in May 2026 sits inside an unusually tense federal-state moment. On May 14, the federal Centers for Medicare and Medicaid Services announced the suspension of $1.1 billion in federal funding tied to California’s In-Home Supportive Services (IHSS) home health program over fraud-integrity concerns, alongside an additional $200 million in withheld administrative claims, as reported by CalMatters. State officials, including Governor Gavin Newsom and Medi-Cal director Tyler Sadwith, have disputed the framing and said IHSS services will continue without interruption while the state works to resolve the federal questions. The action targets IHSS, not the Medi-Cal Behavioral Health Treatment (BHT) benefit, and current BHT providers are not directly affected. But the deferral is now part of the policy backdrop against which a separate, also-pending federal review is unfolding: CMS approval of California’s rate-setting amendment for Medi-Cal ABA services. Assuming the BHT pathway continues to operate as DHCS has proposed, here is where the state of the state stands.

The structural backdrop matters for understanding what SPA 25-0028 is trying to accomplish. Historically, fee-for-service Medi-Cal members under 21 received BHT services through their local Regional Center under the Lanterman Act and DDS-administered rates, paid to Regional Centers under an interagency agreement between DHCS and DDS. Managed care plans handled BHT for their enrolled members under plan-negotiated arrangements. Effective July 1, 2025, DHCS opened a new pathway: children with fee-for-service Medi-Cal can opt to receive BHT services from an enrolled Medi-Cal Qualified Autism Service (QAS) provider billing Medi-Cal directly, in addition to their local Regional Centers. SPA 25-0028 establishes the rates Medi-Cal would pay those QAS providers under that direct-billing pathway.

What SPA 25-0028 Proposes and Why It Matters

DHCS published the public notice for SPA 25-0028 on June 24, 2025, with an addendum on August 28, 2025. The amendment proposes to establish Medi-Cal fee-for-service fee schedule rates for BHT services provided by enrolled Medi-Cal QAS providers, effective for dates of service on or after July 1, 2025. The addendum frames the methodology as a direct adoption of DDS rates: because Medi-Cal pays at a single statewide rate, DHCS selected the highest Regional Center rate used by DDS for BHT services as the benchmark.

The structure of the proposed rates is unusual. Most state Medicaid programs tier ABA reimbursement by CPT code, with assessment and protocol-modification codes paying more than technician-delivered treatment. California’s proposed structure inverts that logic: rates are uniform across most direct-service codes within a given provider tier, and the differentiation comes from the rendering provider’s credential. The QAS Provider tier (BCBA-level) pays the highest rate, the QAS Professional tier (BCaBA-level) pays half that, and the QAS Paraprofessional tier (RBT-level) pays slightly less than the Professional tier.

Proposed Medi-Cal BHT Fee-for-Service Rates (SPA 25-0028)

For ABA providers and other behavioral health organizations working in or around schools, the most consequential question is often not how much money is in the system but which services qualify for which funding stream. The answer turns on a distinction between educational services governed by the Individuals with Disabilities Education Act and clinical services governed by Medicaid, private insurance, or both.

IDEA requires public schools to provide a free appropriate public education to students with qualifying disabilities under one of 13 categories. Mental health counseling and behavior intervention plans can appear as related services in an IEP when the team determines the student needs them to access education. A Section 504 plan provides accommodations for students with physical or mental impairments that substantially limit a major life activity but does not require specialized instruction. School-based mental health services funded through district budgets, state allocations, or non-IEP-linked Medicaid claims sit alongside but outside that IDEA framework.

Applied behavior analysis sits in a particularly uneasy position. ABA is widely covered by Medicaid as medically necessary under the Early and Periodic Screening, Diagnostic, and Treatment benefit when prescribed for children with autism, but schools generally do not employ Board Certified Behavior Analysts the way they employ school psychologists or speech-language pathologists. Many states explicitly exclude ABA from their school-based Medicaid reimbursable services list. Acuity has reported on the wider Medicaid policy environment shaping ABA delivery, including Indiana’s credential-tiered phasedown of Medicaid ABA reimbursement and the federal OIG audit findings tightening documentation standards across the field, both of which signal stricter credentialing requirements at every ABA delivery site, including schools.

The practical effect for students with autism is that school-based ABA arrives through one of two pathways. Either the school district funds a BCBA or ABA-trained paraprofessional through special education dollars to support IEP goals (focus, transitions, peer interaction during class time), or an outside ABA agency provides services on school grounds under a separate medical-insurance authorization, with goals oriented to non-educational outcomes. The two are supposed to be complementary.

School psychologist shortages and student-to-provider ratios: a workforce stretched thinner than the funding

Source: California DHCS, State Plan Amendment 25-0028, Attachment 4.19-B (proposed). Rates are proposed and remain pending CMS approval. All amounts are per 15-minute unit unless otherwise noted in the underlying code definition. For granular fee schedule data across all 50 states, MediRate maintains the underlying datasets.

The public comment window closed September 29, 2025. CMS approval timelines for rate-setting SPAs of this scope typically run several months to a year, particularly when methodology questions are involved. Until CMS approves the SPA, the Medi-Cal fee-for-service rates file continues to show the core BHT codes with no published amount, reflecting the historical delivery through Regional Centers rather than direct Medi-Cal billing.

The IHSS deferral introduces a new variable into that timeline. CMS approval of a state-plan amendment is a discretionary federal action, and rate-setting SPAs in particular invite federal scrutiny of methodology, budget neutrality, and program-integrity controls. With CMS Administrator Mehmet Oz publicly framing California as an outlier on home-health spending growth, with the administration raising program-integrity concerns about IHSS, and with Vice President JD Vance grouping California with New York and Hawaii as states the administration believes are not doing enough to combat Medicaid fraud, the federal review environment for any new California Medi-Cal rate-setting action is now visibly tighter than it was when SPA 25-0028 was submitted. That does not mean the BHT SPA will be denied: the IHSS dispute and the BHT rate proposal involve different programs, different fraud-risk profiles, and different methodologies. But operators tracking the SPA approval timeline should plan for the possibility that the federal-state dynamic adds time, conditions, or methodology questions to the review rather than smooth it.

Why the Regional Center Rate Benchmark Is the Story

California’s Regional Center system, established under the Lanterman Developmental Disabilities Services Act, has historically been the primary delivery vehicle for ABA and other autism services for Medi-Cal members. The state operates 21 Regional Centers, each with its own service vendor network and its own DDS-set rate structure. DHCS’s methodology decision to use the highest Regional Center rate as the Medi-Cal statewide benchmark, rather than an average or a weighted blend, has direct implications for what providers will be paid if and when the SPA is approved.

This methodology produces some of the higher Medicaid ABA rates in the country. The proposed QAS Provider rate of $40.81 per 15-minute unit comes to $163.24 per hour for direct ABA services. For comparison, Indiana’s fixed rates effective January 2024 were structured around technician-delivered services in a substantially lower range, with further reductions phased in for 2026 and 2027. Florida’s published fee schedule pays $12.26 per 15-minute unit (roughly $49 per hour) for 97153 across all credential tiers. The proposed California QAS Paraprofessional rate of $19.39 per 15-minute unit ($77.56 per hour) is itself higher than many states pay BCBAs.

Two implications follow. First, if CMS approves SPA 25-0028 at the proposed levels, California would join the small group of states paying premium Medi-Cal ABA rates, which could attract additional provider supply into a market that has run primarily through Regional Center vendor networks. Second, the methodology creates a floor pegged to the highest-paying Regional Center, raising questions about how DHCS would handle future DDS rate movements at that benchmark.

The methodology also raises questions about budget neutrality, an area of particular CMS focus given the wider federal-state fiscal disputes now playing out. The public notice frames the SPA as budget-neutral on the grounds that fee-for-service Medi-Cal members are already eligible for BHT services through Regional Centers, with the implicit claim that direct billing reroutes existing utilization rather than creating new demand. Whether that holds will depend on uptake from families opting into the QAS pathway and on how managed care plans respond to a published Medi-Cal FFS rate.

SB 874 Adds a Workgroup, Background Checks, and Clinical Guidance Requirements

Running in parallel with SPA 25-0028 is Senate Bill 874, introduced January 6, 2026 by Senator Akilah Weber Pierson and currently moving through the California Legislature. SB 874 would require DHCS to ensure that certain individuals providing BHT services under Medi-Cal undergo background checks by July 1, 2027, and to convene a stakeholder workgroup of BHT providers, managed care plans, consumers with autism, providers of other services to children with autism, and consumer advocates, among others, to review BHT implementation and advise the department on clinical guidelines, treatment plan requirements, requirements for center-based versus other delivery settings, supervision of unlicensed and uncertified professionals, managed care plan documentation standardization, and best practices in contracting. The bill would also require DHCS to release and maintain clinical guidance for the BHT benefit by January 1, 2028, and to report to the Legislature on BHT utilization, workgroup outcomes, and Medi-Cal reimbursement alignment with federal Medicaid program integrity requirements by January 1, 2029.

SB 874 moved through the policy committees and the fiscal hearings on the standard first-house track. The bill passed the Senate Health Committee on April 15 and the Senate Public Safety Committee on April 21, then was placed on the Senate Appropriations suspense file without objection on May 4. At the May 14 suspense hearing, the Appropriations Committee voted “Do pass” on SB 874 by a 7-0 vote, advancing the bill to the Senate floor. It will need to clear the floor before crossing to the Assembly. The clinical guidance and background check provisions would create operational obligations for both DHCS and BHT providers regardless of how SPA 25-0028 resolves. The bill’s explicit linkage of Medi-Cal reimbursement to federal Medicaid program integrity requirements also takes on new resonance against the IHSS dispute, with state lawmakers signaling alignment with federal compliance expectations even as the executive branches spar.

California has been active on related BHT policy in recent quarters. CMS approved SPA 24-0031 on May 15, 2025 (effective January 1, 2025), with technical updates clarifying coverage of behavioral health treatment under the EPSDT benefit and updating who can supervise paraprofessionals. The cumulative pattern is one of incremental expansion of who can deliver BHT and under what authorization framework, with SPA 25-0028 representing the most significant rate-setting change of the cycle.

The broader regulatory environment in other states reinforces the stakes for California. Indiana’s February 2026 Bulletin BT202627 imposed phased rate cuts, a 4,000-hour lifetime cap, and an EPSDT-only eligibility limit. OIG audits across multiple states have flagged hundreds of millions in improper Medicaid ABA payments, with documentation and credentialing as the most common deficiency categories. Georgia ABA providers received a unilateral 20-percent rate cut from CareSource in March 2026. California’s direction, with proposed rates above the national norm and a workgroup-and-guidance approach to oversight, sits at the more provider-favorable end of the current spectrum.

What California ABA Providers and Operators Should Be Watching

Three issues will shape California’s Medi-Cal ABA market through 2026. First, the CMS approval status of SPA 25-0028, now being reviewed against a backdrop of public federal-state friction over California Medi-Cal spending. If CMS approves at the proposed levels, providers enrolling as Medi-Cal QAS providers would have a path to direct Medi-Cal reimbursement at rates substantially higher than most state programs offer. If CMS requires methodology changes, attaches integrity-related conditions, or denies the SPA, providers would continue under the current arrangement: Regional Center vendor contracting for fee-for-service Medi-Cal members, plan-negotiated rates for managed care members.

Second, managed care plan response to a published Medi-Cal FFS rate. Most Medi-Cal members receive services through one of the contracted managed care plans, and plans negotiate ABA rates with their network providers directly. A published Medi-Cal FFS rate at $40.81 per 15-minute unit would establish a visible reference point that plan-negotiated rates would inevitably be compared against. Whether this creates upward pressure on plan rates, downward pressure on plan utilization through tighter authorization, or both, will become clearer as the SPA approval and plan contracting cycles play out. Plans operating under tighter state budget conditions, if the IHSS deferral or related federal actions stretch out, may take a more cautious posture on rate increases regardless of where the FFS benchmark lands.

Third, the relationship between QAS direct-billing and the Regional Center vendor system. DDS has not signaled an intent to retire or wind down Regional Center BHT delivery; the new pathway is explicitly opt-in for families. But provider organizations that operate in both systems will need to decide where to direct staffing, contracting, and business development resources. The 10 largest ABA companies in the country include several with significant California footprints, including Autism Learning Partners and Center for Autism and Related Disorders, and their strategic responses to the dual pathway will likely set the pattern for smaller operators.

California’s 2026 ABA Medicaid picture is one of consequential proposals in motion rather than settled policy. SPA 25-0028 represents the most significant Medi-Cal ABA rate-setting action in years, and its CMS approval status, now intersecting with a wider federal-state Medi-Cal dispute, will be the dominant variable for provider economics through the remainder of the year.

Frequently Asked Questions

Does the May 2026 federal Medicaid funding freeze on California affect ABA providers?
Not directly. The federal action announced on May 14, 2026 by CMS is the suspension of $1.1 billion in federal Medi-Cal funding tied to California’s In-Home Supportive Services (IHSS) home health program, plus an additional $200 million in withheld administrative claims. IHSS is a separate Medi-Cal benefit covering personal care and daily-living support for seniors and people with disabilities, distinct from the Behavioral Health Treatment (BHT) benefit that covers ABA. California officials, including Governor Gavin Newsom and Medi-Cal director Tyler Sadwith, have stated that IHSS services will continue uninterrupted while the state addresses CMS’s integrity concerns. The action does not change BHT eligibility, the Regional Center pathway, the QAS direct-billing pathway, or the proposed rates in SPA 25-0028. It does, however, raise the federal-state temperature in which CMS is reviewing the BHT SPA, and providers tracking the SPA timeline should treat that as a relevant background factor.

Has CMS approved California’s SPA 25-0028 for Medicaid ABA rates?
As of May 2026, SPA 25-0028 has not been listed as approved on the CMS Medicaid State Plan Amendments page or on DHCS’s approved SPAs page. DHCS published the public notice on June 24, 2025, issued a methodology addendum on August 28, 2025, and closed the public comment window on September 29, 2025. The Medi-Cal fee-for-service rates file as of April 15, 2026 continues to list the core BHT codes (97151 through 97158) with no published statewide reimbursement amount, reflecting the SPA’s pending status. The proposed effective date in the public notice remains July 1, 2025, contingent on CMS approval.

What rates would SPA 25-0028 establish for Medi-Cal ABA services?
The proposed rates are organized by rendering provider type rather than by CPT code. The QAS Provider tier (BCBA-equivalent) would receive $40.81 per 15-minute unit for most direct-service codes including 97151, 97152, 97153, 97155, and 97156. The QAS Professional tier (BCaBA-equivalent) would receive $20.45 per 15-minute unit, and the QAS Paraprofessional tier (RBT-equivalent) would receive $19.39 per 15-minute unit. Group service codes 97154, 97157, and 97158 are reimbursed at roughly half the individual rate. DHCS developed these rates based on the highest Regional Center rate used by the Department of Developmental Services to reimburse local Regional Centers for BHT services.

How does California currently deliver Medi-Cal ABA services if no statewide rate is published?
California’s BHT services for Medi-Cal members under 21 have historically been delivered through two channels. Children with fee-for-service Medi-Cal received BHT through their local Regional Center under the Lanterman Act, with DDS paying the Regional Center vendors at DDS-set rates under an interagency agreement with DHCS. Children enrolled in Medi-Cal managed care plans received BHT through their plan’s network, with plan-negotiated rates. Effective July 1, 2025, DHCS opened a new pathway allowing children with fee-for-service Medi-Cal to receive BHT from enrolled Medi-Cal QAS providers billing Medi-Cal directly, in addition to their local Regional Centers. SPA 25-0028 would establish the rates for that direct-billing pathway.

What does California SB 874 require for Medi-Cal behavioral health treatment?
SB 874, authored by Senator Akilah Weber Pierson and as amended in April 2026, would require DHCS to ensure that certain individuals providing BHT services under Medi-Cal who do not hold a current and valid California state license requiring a fingerprint-based background check undergo such a check by July 1, 2027. The bill would also require DHCS to convene a stakeholder workgroup of BHT providers, managed care plans, consumers with autism, providers of other services to children with autism, and consumer advocates, to review BHT implementation and advise the department on clinical guidelines, treatment plan requirements, requirements for center-based versus other delivery settings, supervision of unlicensed and uncertified professionals, and best practices in contracting. By January 1, 2028, DHCS would be required to release and maintain clinical guidance for the BHT benefit. By January 1, 2029, the department would report to the Legislature on BHT utilization, workgroup outcomes, and recommendations for Medi-Cal reimbursement alignment with federal Medicaid program integrity requirements. The bill passed the Senate Appropriations Committee on a 7-0 “Do pass” vote on May 14, 2026 and is now pending action on the Senate floor.

Who is a Medi-Cal Qualified Autism Service (QAS) provider?
Medi-Cal recognizes three categories of QAS providers, defined in Supplement 6 to Attachment 3.1-A of the California Medicaid State Plan. QAS Providers are typically licensed clinicians or BCBA-credentialed practitioners who carry full responsibility for the assessment and behavior plan. QAS Professionals are assistant-level practitioners, generally BCaBA-credentialed, who deliver services under the supervision of a QAS Provider. QAS Paraprofessionals are technician-level practitioners, generally RBT-credentialed, who deliver direct treatment under supervision. SPA 25-0028’s proposed rate structure differentiates reimbursement across these three categories rather than by CPT code, which is unusual relative to other state Medicaid programs.