Ontario Autism Program thoughts: $55/hr for therapy is not a rip-off. Let’s break this down

Whenever I tweet about how much families are paying out of pocket for ABA therapy, I invariably get a Ford supporter responding “it’s not Doug Ford’s fault that private providers are ripping you off.”

But when you look at the cost of providing the service, it’s hardly a rip-off. I’ve started and run service businesses, so I’ve got some experience with the business model.

First, ABA is 1-to-1, so you’ve got a therapist for every child. So you’ve a therapist with higher-ed training, so you’re not likely to find someone good to work for minimum wage. There’s salary and (hopefully) some health benefits in there.

Then there’s payroll taxes on top of that. Employer-side EI and CPP. WSIB. Don’t forget Ontario’s Employer Health Tax.

(A digression involving my day job as a policy wonk: I get why people are worried about the employment consequences of a carbon tax. We should be concerned about the employment consequences of all government policies. People, including many politicians, are worried that it will reduce net employment, despite evidence to the contrary. Meanwhile we have a tax in Ontario that is literally a tax on paying employees that dings businesses whenever they hire. Plus there’s a huge cumbersome bureaucracy to administer and enforce the tax. Yet NOBODY worries about the effect it has on employment, simply because it’s been around forever. If we’re worried about a job killing tax, go after the EHT. We could make up the lost revenue with something like, say, a carbon tax.)

Anyhow, employees are expensive. Plus you’re going to have to pay people for non-billable hours. Office managers. Janitors. You name it. So have to consider those wages (and payroll taxes) on top of the wages for therapists. even if you’re outsourcing some of those activities.

Then you have to put the facility somewhere. These facilities are often in industrial parks to save money, but you’re still looking at $15/sqft/yr in rent+fees. Likely significantly more. Even a small 3000 sqft facility is going to run you $4000 a month. Plus utilities.

You need all the stuff inside the facility, which is going to wear down and break from time to time, so has to be replaced.

And let’s not forget insurance. You’re dealing with kids, many of which are vulnerable to self-harm. I don’t even want to know how much liability insurance is going to cost these places.

Point is, you’ve got an awful lot of expenses, which are going to add up to something approaching $55/hr pretty quickly.

That said, I still can’t figure out why CHEO is charging $84.