$1m NDIS plans in two-year surge

There were more than 1000 people on plans costing taxpayers more than $1m a year and seven costing more than $2m, new documents reveal.

There were more than 1000 people on NDIS plans costing taxpayers more than $1m a year and seven costing more than $2m at the end of last financial year, according to documents.

The number of NDIS participants on plans worth at least $1m has more than doubled in the past two years, new documents reveal, with calls for more transparency over the value of plans as the government seeks to rein in the growth of the $42 billion scheme.

There were more than 1000 people on plans costing taxpayers more than $1m a year and seven costing more than $2m at the end of last financial year, according to documents obtained under freedom of information.

This is on top of more than 10,000 participants whose care plans cost over $500,000 a year.

The proportion of people on the high value plans was less than 2 per cent of all NDIS participants, but accounted for $6bn – or about 15 per cent – of the cost of the NDIS as of June 2023.

The number of people on such plans has doubled in the last two years, with documents from March 2021 revealing just 450 people on plans worth over $1m a year and 5100 on plans worth between $500,000 and $999,000.

NDIS Minister Bill Shorten said since 2021, the number of NDIS participants had increased from 450,000 to 630,000 and “a small fraction” of these had complex care needs that they required to stay alive.

“Part of the increased plans is because of inflation. The price of disability support has risen approximately 15 per cent in the period since 2021,” he said.

“The participants who have plans of more than $1 million would need around the clock care with long periods with at least two carers at time in order to stay alive. These are Australians with the most complicated disabilities and challenging behaviours, including complex cerebral palsy, the severest spinal cord injuries or mental health conditions that require at least two carers at a time for safety and to meet their physical needs.”

Mr Shorten said the funding in the high value plans would be used on accommodation, intensive caring and supports, as well as assistive technology like specialist wheelchairs or breathing equipment.

The average participant receiving a Supported Independent Living package – a type of support allowing someone to live in their own home with 24/7 care – is $350,000.

The average rate of a support worker in SIL ranges from $56 an hour to $350 an hour depending on the time of day, needs of the participant and whether they live in or outside of a metropolitan area.

The price of “high-cost assistive technology”, which includes custom wheelchairs, ventilators, complex communication devices and prosthetics, start at $15,000 per item.

“These are the Australians the NDIS was created for and this why the Albanese Labor Government has bipartisan support to ensure the Scheme is here for future generations,” Mr Shorten said.

People Economics director and former NDIS strategist, Hassan Noura, pointed to high levels of inflation — well above wage increases — within the scheme as a potential reason behind the doubling of high value plans.

The cost of SIL plans have increased by more than 17 per cent annually since 2018.

“This government has also talked about how it has cleared the backlog of participants’ disputes with the Australian Administrative Appeals tribunal … which may have led to cases previously held up being settled with large package values,” Mr Noura added.

Former Coalition NDIS Minister Linda Reynolds said the growth might come down to people being moved out of state-run homes and said the cost of human dignity “could be expensive”, but that the NDIS was created for this very purpose.

Head of disability provider Aruma and former NDIS board director, Martin Laverty, said that an ongoing effort to shift young disabled people from residential aged care to SIL could be a reason behind the growth.

Dr Laverty also pointed to the reduction of hospital “bed block” – which at its peak saw NDIS participants medically fit to leave hospital waiting an average of 160 days to do so – as a potential contributor to the explosion of high value plans, along with ongoing concerns over the NDIS “tax”.

Analysis by The Australian last year found mark-ups between NDIS approved items and those on the open market of more than 1000 per cent, with an NDIS approved folding walking stick costing $457, compared to $30 for a similar product sold online.

The revelations of the mark-ups sparked outrage from advocates and participants – who likened the rorting to a “wedding tax” – and was met with a promise from Labor to crackdown on dodgy providers artificially increasing their prices.

Labor has also poured millions into rooting out criminal networks skimming millions from genuine NDIS recipients, with a federal task force last year uncovering multimillion-dollar mansions suspected of being paid for through defrauded NDIS funds.

However, Mr Noura said that the growth of multimillion-dollar plans might necessitate a conversation over the cost of individualised support becoming so high that “it may not be the most efficient way to deliver support”.

“It’s really tricky, right? Because, you know, if they’re a young person they are trying to maintain independence and live in the community, then they probably don’t want to live in a facility or group home. On the other hand, if their plan is worth $1m to $2m, is it fair to ask taxpayers to pay that?” he said.

“It would be very hard to ever get an answer to that question. You really come up against this crux of need and choice and control (of the participant) vs. cost to taxpayers.”

It would take the entire yearly income tax of 50 workers on a wage of $90,000 to pay for a single $1m NDIS plan.

But People With Disability Australia president and Paralympian Marayke Jonkers – who said the number of plans worth over $500,000 was less than she expected – pointed out that the taxpayer dollars funding the NDIS went right back into the economy.

“What I don’t think the public truly understand is we don’t get the money as NDIS participants. Those large plans, the participant didn’t get a million dollars. People who are taxpayers were paid that money to provide a good or a service and it went back to the economy,” she said.

“That’s good for the entire country, the money circulates straight back. I believe it was $2.67 that went back into the economy for every dollar spent out of those plans.”

She said that every Australian was just “one slip or car accident away from also potentially needing a large NDIS plan”.

Dr Laverty said the NDIS participants with large plans were “exactly who the scheme was meant for”, rather than those with milder disabilities.

“A single public hospital bed’s average annual operational cost is $1.7m. A small number of people with significant disability need hospital like care,” he said.

“No one questions need for hospital beds. If the NDIS didn’t provide high intensity support more, some people with disability would have no choice but hospital admission in any case.”

Mr Noura also agreed that, given those with profound disabilities were who the scheme was originally intended for, government focus should remain on shifting those with milder disabilities – such as some forms of autism – to mainstream services to rein in the scheme’s growth.

The Commonwealth and state governments agreed to a jointly-funded $10.5bn deal last year to finance additional “foundational supports” outside the NDIS to cater for those with milder disabilities.

The announcement was made after the release of the 12-month-long NDIS Review, which raised concern with the growing cost of the scheme that already supported a further 100,000 people more than 2017 projections.

Both Mr Noura and Dr Laverty lashed the lack of transparency over the NDIS and the size of certain plans, which Mr Noura said created a sense of “secrecy and mistrust” that was against the public interest.

It follows economic modelling underpinning the government’s eight per cent growth target being blocked for release by the Treasury Department due to the “confidentiality” of national cabinet discussions and potential damage it would cause to Commonwealth and state government relationships.

Opposition NDIS spokesman Michael Sukkar said Mr Shorten needed “come clean” about the plans, and inform those on high value plans whether they would see any cuts in order for Labor to meet its 8 per cent growth target.

“In Opposition, Labor stood in the way of the Coalition’s attempts to put the scheme on a sustainable footing. Before the election Bill Shorten promised no plan would go backwards and no cuts would be made,” he said.

“Since then, the sustainability of the scheme has been all Bill Shorten can talk about.”