Disclosure Log

Annual Pricing Review 2022–23

Matters for Discussion

Presented by: David Gifford, Deputy Scheme Actuary

Disclosure Log

FOR OFFICIAL USE ONLY Pricing Arrangement Reference Group - February 7th, 2023

Heightened costs of living pressures

• CPI rose up over a twelve-month period ending September quarter ’22 at an annual rate increase highest seen within last ten years.
• Supply chain problems worsen due COVID pandemic which may impact disability providers negatively;
• Therapy level two and three as well as Plan Management supports haven’t had any inflationary increases since July’19; July’20 & July’22 respectively. Sector feedback argues business viability in absence price rises.

Annual Financial Sustainability Report (AFSR) shows Scheme expenses continue growing with risks on upside:

• Projected total Scheme expense accrual basis $34 billion in year end 22-23 increasing to $89.4billion$inyearend31-’32. Represents GDP growth from .5%to .2%.`
• Range plausible outcomes widen future uncertainty cost drivers assumptions reflected range between fifth ninetieth percentile for projections compared third twentieth percentiles for same periods.
• Projections higher than previous forecast significant driver is major price increases implemented including DSW support’s nine percentage point rise.

NDIS Review currently underway timing overlaps APR:

• Announced by Minister October 2022 yet finalises detailed work plan expected considering matters such current state of pricing regulation, deregulated approach provider registration implications various scenarios
• Current fee-for-service structure opportunity move towards capitation or outcome-based structures. Each issue considered review has potential strategic significance impacting arrangements future.

Specialist Disability Accommodation Pricing Review happening concurrently;

The NDIA also undertaking SDA Pricing Review separately to the annual process occurring every five years will examine related areas only.

DISCLOSURE LOG

FOR OFFICIAL USE ONLY Pricing Arrangement Reference Group - February 7th , 2023

• On November 4 th.,the Fair Work Commission (FWC) increased minimum wages direct care classifications Aged Care Award Social Community Home Care Disability Services Industry Award SCHADS award nurses working aged covered Nurses Award majority disability support workers delivering NDIS supports Schedule B SCHADS which higher rate than aged care even with increase. • The will consider impacts in the aged care sector.

Disclosure Log

FOR OFFICIAL USE ONLY

Pricing Arrangement Reference Group - 7 February 2023

• Prior to July 2019, all types of therapists had the same price limit. The Review of Therapy Pricing Arrangements in 2019¹ recommended division of psychology, physiotherapists and other therapists each with their respective price limits due to different market rates.
  
• The Review of Therapy Pricing Arrangements recommended not to differentiate prices further due to a lack of compelling evidence and implementation challenges.

Disclosure Log

Pricing Arrangement Reference Group - For Official Use Only (February 7th)

Milestones	Indicative Timing/Completion
Board Meeting: Stakeholder Engagement Outcomes & Draft APR Recommendations	April, 2023
PARG Meeting: Final APR Recommendations Before May Board Meeting	MAY-APRIL 2023
Final APR Report And Implementation	June , 2023

Disclosure Log

FOR OFFICIAL USE ONLY

DOCUMENT 56

Pricing Arrangement Reference Group (PARG) Meeting: 3 March 2023

Members
Chair
Pricing Reference Group Members \Deborah PSM Independent Member By Teams Julie PSM Independent Member By Teams Lynne PSM Independent Member By Teams Jim PSM Independent Member By Teams Participating Observer nominated by CEO Jo General Manager, Provider and Market Development By Teams Kee Branch Manager, Economics and Pricing By Teams Jenny Director, Economics and Pricing Branch By Teams Secretariat Vincent Director, Economics and Pricing Branch By Teams Apologies - Kee A/g Branch Manager, Economics and Pricing - Gerrie General Manager, Provider and Market Development Annual Pricing Review Consultation Paper The Group discussed to broaden consultation paper recognising other stakeholders while targeting more specific feedback through questions.
The questions in need nuanced solution-focused such as asking best way address workforce issues members acknowledged importance soliciting input from range of stakeholders ensure process inclusive thorough It was noted risk seeking feedback on things outside scope document This could undermine credibility consult process lead frustration among stakeholders. The agreed important clearly define purpose information likely influence Board’s consideration suggested that should acknowledge previous feedback indicate how considered group agree approach demonstrate commitment being responsive stakeholder concerns.

Disclosure Log

Pricing Arrangement Reference Group Meeting Minutes

• Members also noted that the consultation paper should recognize the existence and role of NDIS review.
• The questions relating both support coordination plan management were examined but stakeholders still be given change provide general perspectives consensus through process any information provided directly factored into decision considered by NDIS Review.
• Concerns need better communication engagement with Aboriginal Torres Strait Islanders acknowledge their interest perspectives in terms main workforce issues facing sector members suggested asking what most important single thing could change would elicit more specific responses additionally, members noted time-poor asking stakeholder detailed submissions when intended minimum carries reputational risks group agreed consider constraints ensure efficient effective consult process.