NDIS Review to suggest major structural reforms

Today, the NDIS Review Panel gave us a highly anticipated glimpse into how it hopes to reform the NDIS. The town hall and provider webinars were symbolically held in Newcastle, the location where then Prime Minister Kevin Rudd officially launched the NDIS in 2013. Now, Newcastle may well go down in history for a second time. Because the changes proposed by the Review Panel today are not tinkerings around the edges, they are major structural reforms to Australia’s entire disability landscape.  

The Panel has previously summarised the key challenges facing the Scheme in their Interim Report (you can read our analysis here). But today’s talk was the first indication we’ve had about what solutions they might recommend. 

Panel co-chair Professor Bruce Bonyhady told the community that rising costs are very serious and real, and called for significant change. He argued that governments, service providers, participants and family members all need to stop treating the NDIS as though it is a limitless ‘magic pudding’. Because unlike the magic pudding, the NDIS is finite, and is in danger of overshooting its target of an 8% expenditure growth limit.

This is all quite serious, but I can’t help seriously craving pudding right now. It doesn’t have to be magic, chocolate is also fine. 

Professor Bonyhady said the NDIS is a policy miracle. It was a policy idea that got off the ground against all odds. But we now have to protect that miracle, and that happens by making some real changes. 

Do we need a 3 tier system?

When designing the NDIS, the Productivity Commission envisioned a 3 tier system:

• Tier 1: All Australians
• Tier 2: People with disability who do not need individualised support, approx 1 in 5 Australians
• Tier 3: People with significant and permanent disability who required individualised support, approx 1 in 50 Australians

All governments were meant to work towards creating an inclusive and accessible community for people in Tier 2, while the NDIS would provide individualised packages for people in Tier 3. Only, it didn’t exactly turn out that way. Governments started relying on the NDIS to deal with all things disability-related, and there were fewer and fewer services available to the many Australians with disability not eligible for the NDIS. The Scheme became the ‘oasis in the desert.’ But- to mix metaphors ever so slightly- the oasis is not a limitless magic pudding. 

In response the Review is considering recommending abolishing the 3 tiered system. Yes, you read that correctly. If it happens, this will be the most significant reform in the NDIS’ history. 

Under the Review’s proposed system, all Australians with a disability will have access to a foundational level of support. This will include things like information and peer support. A smaller number of people will also be able to access assistance with cooking, shopping and cleaning. For children with developmental delays, there will be maternal and child welfare centres, integrated child and family centres, and early childhood education.

Individualised support packages will be built on top of this foundational support. 

The Review Panel believes that an inter-governmental agreement should be drawn up to commit to these foundational supports. So it seems that some intense negotiations between States and Territories and the Commonwealth might be on the horizon. 

Reasonable and necessary supports

The Review’s Interim Report highlighted the lack of clear definition around ‘reasonable and necessary’, and how this is contributing to inconsistent decision making and conflict between people with disability and the NDIA. 

In response, the Review is considering 3 key changes:

1. Reasonable and necessary supports would be set at an overall package level, rather than by building a plan through line-by-line supports. 
2. Instead of determining supports through the medicalised model of assessing functional impairment, plans would consider what it would take for a person to actively participate in their community. Things like goals and living arrangements would be taken into account.
3. The NDIA, rather than Local Area Coordinators (LACs) would determine what is reasonable and necessary. This will include the NDIA paying for any assessments that they need. While officially NDIA delegates are already the only ones with authority to determine reasonable and necessary, most plans are still drafted by LACs and sent to the Agency for approval. 

It is also the Panel’s ‘emerging view’ that combining planning and budget setting has created an unnecessarily stressful relationship between the NDIA and people with disability. They are considering recommending that planning occurs after the budget has been set. 

Early childhood 

With 20% of children experiencing learning difficulties, developmental delay or being diagnosed with a disability, the Review Panel considers early childhood intervention to be an area that requires a  ‘complete and urgent rethink.’

Ideas being considered include: 

• Support to be provided to all children and families as a foundational support. 
• Developmental concerns to be identified as early as possible in mainstream settings. 
• Early intervention  to be delivered based on best practice, including utilising the key worker model and delivering most support in the child’s home, school or early childhood centre.
• Providing better support for families. 
  

The market

At the provider webinar, Professor Bonyhady made the case that markets have often failed to drive the intended innovation, inclusion and participation. Rather, they have driven up costs and led to new forms of segregation, exclusion and in some cases abuse and exploitation.  Traditional providers report struggling with price caps and the administrative margin has fueled the growth of an unregistered market. But many other providers are said to be over charging and overservicing, sometimes to the point of fraud. Additionally, Plan Managers and Support Coordinators are not always ‘playing the roles that were intended.’ In response, the Review is going to recommend a major investment in Scheme sustainability. 

Professor Bonyhady argued that the conditions for deregulating pricing do not exist, and that price caps need to be based on better data that reflects market realities. Prices should consider how best to support participants with complex needs and in regional and remote areas. 

The Review is considering market reforms to enable better outcomes, innovation and quality and says governments need to take a more active role in stewardship. This includes looking at payments based on outcomes rather than solely fee-for-service. 

Workforce

The Review has heard that the workforce is burned out. Pay does not reflect experience or qualification, with a worker on an ABN able to be paid twice as much for taking a person shopping than someone specialising in complex supports. Not surprisingly, turnover is high. Yet the Scheme needs another 128,000 workers by mid-2025. 

Professor Bonyhady said a key driver of the NDIS’s success is a well trained workforce. Therefore, the Review would like to see the introduction of micro-credentials and portable training that travels with workers between employers. 

Unregistered providers 

The unregistered provider market is growing at a rapid rate, now sitting at approximately 140,000 providers. The Review has heard that unregistered providers attract ‘strident critics and passionate defenders.’ But Professor Bonyhady said there needs to be a quality and safeguards system that has overview over the entire market and workforce, that includes- you guessed it- the unregistered market. He flagged that the Review Panel will have more to say on this issue in coming days. 

Professor Bonyhady acknowledged that when we talk about changing the NDIS people have mixed feelings. There’s the hope that it might get better, and the very real fear that people might lose out. But Professor Bonyhady concludes that the ‘NDIS does not just belong to us. It also belongs to the generations that follow us.’ And in a sentiment that has also been expressed by Spiderman and Harry Potter- ‘with rights come responsibilities.’ The Panel is asking us to come together as a community and seriously consider what these rights and responsibilities are.