Could Plan Management be on its way out?

For months, we have been hearing rumours that the NDIA has plans in the works to develop a real time claims and direct payments program. Up until now there has not been a lot of publicly available information about the program’s progress or function. But a tender recently released changes all that and included some confusing (and frankly concerning) comments about how the platform may impact the future of plan management.

We now have some understanding about what the Agency envisions for the program, and what it might mean for the sector. The stated aim is to facilitate a “simple, consistent, automated claims and payments process” between the provider and NDIA, regardless of the person’s plan management type. Which, I think we can all agree, would not be a bad thing. We’ve summarised the key points of the tender below.

Why is this happening?

It’s no secret that the current NDIS payments process is far from perfect. The tender identifies a number of existing problems, including:

• The amount of manual work for participants, providers and the NDIA

• The length of time between the support being delivered and the payment received

• Issues with payment correctness, payment integrity and payment fraud

• Lack of data collected on supports provided to participants

All of these problems are likely to increase as the Scheme grows. In the six months leading up to December 2019, 17.6 million claims were processed. That is compared to 4.5 million in the 12 months leading up to 30 th June 2017.

The idea of an automated payments process is not without precedent. Medicare uses one, as do private health insurers and, more controversially, there is the Centrelink cashless debit card.

Features

The tender lists the features that the NDIA would like to see in the new payment process. Keep in mind that it is really just a wish list at this stage. Until the program is actually designed, we won’t know exactly what it will look like or how it will work.

Accessing Real Times Claims

This feature isn’t exactly a mystery - it is kind of in the name. But what exactly does it mean?

Basically, at the point of sale or when a support is delivered, participants or providers can lodge a claim, have it assessed and receive a response (ideally, a payment!). Not unlike when you pay for something on your credit card and it either gets approved or rejected. The tender stresses that it needs to be able to work both in physical environments (eg. a physio office) and online. Naturally it also has to be accessible to people of all physical and intellectual abilities, as well as people who do not use the internet. They also want it to connect to existing devices, such as credit card readers or mobile phones.

Lodge a Claim

The Agency wants providers to be able to pre-authorise a payment before providing a support. This would allow the provider to make sure that the person has enough funds in the relevant support category.

They do not want participants to need a physical card or providers to need an NDIS specific terminal or device so we are unlikely to see physical NDIS cashless debit cards in line with the Centrelink model.

Accessing, Approving and Declining Claims

The idea is that when a claim is lodged, the Participant, provider and/or plan manager receive a real time notification about the outcome of that claim. For this to work, the system would need to be able to detect if a claim breaks particular rules of the NDIS. For example, the rules set out in the Price Guide, price caps, if an Agency managed participant is using an unregistered provider, providers that have been banned from delivering NDIS services, and if a support deemed unlikely to be considered reasonable and necessary (the examples given are alcohol and gambling).

Processing a Claim

In what is likely to be music to most provider’s ears, the Agency envisions payments being made overnight! They also note that the program must have a mechanism to refund or reverse payments.

Alerts and Notifications

As discussed above, the system should be able to send notifications to Participants, Plan Nominees, providers and plan managers about particular payment events, including when a claim has been lodged, approved, rejected or the payment has been made. The notification should be sent using the receiver’s method of choice (eg. SMS, email or push notification).

Data Collection, Use of Data and Reporting

The system will only work if it collects a certain amount of data. The most obvious example is that for every payment made, the amount needs to be deducted from the right support category in the person’s plan. Participants, providers and plan managers should also be able to access reports. For providers, this may mean reports on the total value of payments they have received over a period of time). The NDIA would also like the ability to collect other pieces of information, such as participant satisfaction with the service. Maybe a 5 star rating system like Uber uses?

Security, Controls and Standards

As discussed above, the system will need to have the ability to apply rules of business when accessing claims. The NDIA also wants there to be some mechanisms in place to detect fraudulent claims. It’s not clear exactly how this would work. You’ve probably figured out by now that the Agency is asking quite a lot of this program. To whoever ends up designing it: good luck. You’re going to need it.

Plan management

An overarching question that goes unanswered is what this program will mean for the future of plan management and the tender really sends out mixed signals here. On one hand, plan managers are listed throughout the document as a possible actors in the payment process, as outlined in a few of the features above.

However, one of the stated benefits of the program is that it will “eliminate the need for Plan managers and Participants to be financial intermediaries”. This is said to be to reduce the time between service provision and payment.

These conflicting statements are likely to make plan managers nervous. Until the program is designed, we may not get any answers about what role plan managers will play in this new payment ecosystem. Disability Intermediaries Australia (DIA) have published advice they received from NDIA stating that the intent of this program is not to remove Plan Management but we have to wonder what signal the NDIA meant to send to the market when they included the above “stated benefit”.

There is a lot still unknown but this is certainly a risk that plan management providers should be keeping a close eye on.

Unregistered providers

Another important question is how the payments process will work with unregistered providers. There is not a lot of precedent here. Centrelink’s Cashless Debit Card can only be used at particular shops (indeed that is the whole point of it). Medicare Easyclaim is only available to doctors, specialists, dentists and allied health professionals.

The success of this program is really dependent on what processes, training and equipment unregistered providers will need to receive payments. For some businesses, it will not be worth their while to put any processes in place because they only cater to a small number of NDIS Participants. Participants might also make purchases from international businesses, which have probably never even heard of the NDIS.

What is the timeline?

A timeline? Wouldn’t that be nice!

The tender closes on the 12th June. Beyond that, we don’t know how long this will take. But we imagine it will not be quick.

The current payment process, in all its messiness, is part of the NDIS Act. So the new process would need a change to the legislation, as well as some serious coin set aside. Meaning that basically whatever timeline you had in your head, add a few years.

You can find the tender here. DSC will be watching the development closely and will publish more information as soon as we have it.