NDIS providers evacuate market after pricing review
NDIS providers are leaving the sector in droves following a controversial pricing review, while the not-for-profit sector warns the agency must move urgently on long-stalled financial reforms.
NDIS providers are leaving the sector in droves following a controversial pricing review decision in June, while the not-for-profit sector warns the disability agency must move urgently on long-stalled financial reforms and registration of all providers or suffer a further exodus of services.
As Health and Disability Minister Mark Butler prepares to host his own roundtable on Wednesday to inform Jim Chalmers’ economic reform summit later in the month, Disability Intermediaries Australia has revealed nearly 40 support co-ordination businesses have left the market since June.
Jess Harper, chief executive of DIA, the national peak body for support co-ordinators and plan managers, said the “real world impacts” were being felt from the decision to reduce hourly rates for some support services and slash travel allowances.
“If the NDIA values participant outcomes and long-term productivity, it must address this issue before more damage is done,” he said.
“Providers are closing, staff with disability are losing meaningful employment, and participants are being left without trusted support.”
The question over how to improve the care economy will be a key feature of Labor’s three-day economic roundtable, for which dozens of ideas have already been ventilated – from changes to negative gearing to the need for AI agreements to be struck between employers and businesses.
However, discussion on the $40bn-a-year NDIS has been muted, with many providers and advocates still waiting for further details on the new system of supports Labor has promised to set up for those with milder disabilities.
These “foundational supports” are yet to be agreed with the states.
On top of concerns raised by DIA, which represents for-profit-providers, leading peak bodies and not-for-profits have raised alarm over recent announcements from providers Bedford and Annecto that they would shut their doors.
After Bedford said it would go into voluntary administration, the South Australian government said it would intervene with a multimillion-dollar package.
Founding member of the NDIA board Martin Laverty slammed the body for knowing about the problem facing not-for-profits for some time, with recommendations for reform contained in three reports over the past three years, but not acting fast enough.
“For services to continue smoothly, price reform is not just urgent, but critical,” he said.
He warned not-for-profits were facing incredibly high regulatory burdens but were made to operate under the same financial standards as unregistered providers.
As a result, many providers were in deficit and median liquidity ratios had fallen to only one month, compared to the recommended three.
Despite concerns raised across the for-profit and not-for-profit sectors, the NDIA said the market was growing, not shrinking.
“The NDIA monitors markets to ensure participants have access to quality supports, continue to receive the supports they need and the market remains sustainable,” a spokeswoman said.
“The NDIA does not directly fund providers, but allocates funding to NDIS participants and business decisions, including whether to continue offering services through the NDIS, are a matter for individual organisations.
“In the March quarter there were 263,145 active providers delivering services through the NDIS – up from 205,367 in the same quarter a year earlier.”
More than 40 groups and experts across the disability, health and aged care sector have been invited to Mr Butler’s roundtable, which is being held in Sydney.
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