NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
have generally worsened, and less than half of those responding to the Annual Market Survey recorded a surplus in the previous year.
Professional Bodies
Several professional bodies reported pricing arrangements for therapeutic supports under the NDIS are not reflective of true costs for providers especially when considering inflation, workforce shortages, impact of COVID and NDIS client complexity. These costs are felt more acutely in rural and regional areas due to factors such as competition around wages, housing shortages and increased costs of travel and consumables.
Many professional bodies suggested the increase in NDIS therapy support payments may be the result of increasing provider numbers and participants having more knowledge, choice and control over how they invest their funds. NDIS providers often provide unpaid or underpaid labour to subsidise a participant’s plan, which can impact their business and result in higher costs.
Allied Health Professions Australia (AHPA), who represents some 200,000 allied health professionals, stated data recently gathered from more than 700 speech pathologists, showed that less than a quarter report charging a higher rate for NDIS participants, with the majority charging all clients the same fee. Some therapy providers, particularly physiotherapists, report charging non-NDIS clients a higher fee, as it reflects the true costs of the service. The reasons given for charging higher fees include the complexity of the supports being offered, the level of skill involved and experience of the provider, and additional supervision and professional development requirements. Their submission states:
Therapy providers are overwhelmingly de-registering and choosing to see only self- managed and plan-managed clients due to the untenable burden.
Of those who are not registered, just under 95% indicated that they were not intending to register.
This was concurred by another peak body Speech Pathology Australia who also stated for those who do have differentiated prices, this was frequently referred to in terms of offering a discount to people and families who are unable to access any funding, and for whom therapy would therefore be out of reach.
The Australian Association of Psychologists Incorporated performed a survey in November 2022, with results indicating there has been a significant increase in demand for services in the disability sector. The psychologists’ recommended fees are considerably higher than the price caps for NDIS therapy items, suggesting that psychology is funded at levels that are low, given the education, training, and business costs associated with registration and practice as a psychologist.
Australian, New Zealand and Asian Creative Arts Therapies Association (ANZACATA), a professional body on creative arts therapies, stated that group Art Therapy services under the NDIS is not viable due to the use of more materials, time spent writing more case notes, and the expertise required to facilitate and keep participants safe. The episodic nature of psycho-social disability and its impact on service provision also poses a challenge as participants often have irregular attendance patterns, making it hard to support regular work conditions and contracts and attract staff.
Participants
88
214 Page 53 of 134
s22(1)(a)(ii) - irrelevant material
Page 54 of 134s22(1)(a)(ii) - irrelevant material
Page 55 of 134s22(1)(a)(ii) - irrelevant material
Page 56 of 134NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
2 Introduction
redacted: s22(1)(a)(ii) - irrelevant material
- 13% ($3.9 billion) on capacity building daily activities (therapy services).
redacted: s22(1)(a)(ii) - irrelevant material
14
237 Page 57 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
redacted: s22(1)(a)(ii) - irrelevant material
- for therapy supports to ensure participants receive value for money, while providers strive to improve quality of service and increase efficiency.
redacted: s22(1)(a)(ii) - irrelevant material
15
238 Page 58 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
redacted: s22(1)(a)(ii) - irrelevant material
No changes in price limits were made for therapy supports, support coordination or plan management. Prices for capital items were increased by Consumer Price Index (CPI).
redacted: s22(1)(a)(ii) - irrelevant material
16
239 Page 59 of 134
s22(1)(a)(ii) - irrelevant material
Page 60 of 134NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
redacted: s22(1)(a)(ii) - irrelevant material
- Scheme statistics for each of the topic in scope (DSW-related supports, therapy, plan management and support coordination). The statistics include the movements in terms of participant numbers and payments made.
- Analysing business dynamism of topics in scope, examining the number of provider entrants and exits as well as the general market dynamics.
- Additional benchmarking analysis for therapy in terms of comparison to other government and funding schemes and private market billing rates.
redacted: s22(1)(a)(ii) - irrelevant material
19
242 Page 61 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
5 Therapy supports
5.1 Context
Therapy supports are important to participants and to the NDIS. They assist participants build capacity to achieve their goals and they have the potential to reduce long term costs in the NDIS as they can assist participants to regain capacity.
Therapy services are among the crucial supports available to NDIS participants. These supports are mainly delivered by Art Therapists, Audiologists, Counsellors, Developmental Educators, Dietitians, Exercise Physiologists, Music Therapists, Occupational Therapists, Orthoptists, Physiotherapists, Podiatrists, Psychologists, Rehabilitation Counsellors, Social Workers, and Speech Pathologists.
Therapy services can also be delivered by Therapy Assistants working under the delegation and direct supervision at all times of a therapist. Where a support is delivered by a therapy assistant, the therapy assistant must be covered by the professional indemnity insurance of the supervising therapist (or the therapist’s or therapy assistant’s employing provider).
Within the NDIS, most therapy is delivered under three provider registration groups:
-
Therapeutic Supports (0128): Provision of a mix of therapies, to assist participants aged from 7 years to apply their functional skills to improve participation and independence in daily, practical activities in areas such as language and communication, personal care, mobility and movement, interpersonal interactions and community living.
-
Early Intervention Supports for Early Childhood (0118): Provision of a mix of therapies, and a key worker for the family. Supports children 0-6 years with developmental delay or disability and their families to achieve better long-term outcomes, regardless of diagnosis.
-
Exercise Physiology & Personal Well-being Activities (0126): Physical wellbeing activities promote and encourage physical well-being, including exercise.
Therapists also deliver supports under the following registration groups:
-
Specialist Positive Behaviour Support (0110): Includes support items provided by allied health professionals with specialist skills in positive behaviour support including assessment and the development of a comprehensive plan that aims to reduce and manage behaviours of concern.
-
Custom Prostheses and Orthoses (0135): Prescription and manufacture of customised prostheses or orthoses requiring specialist skills.
-
Specialised Hearing Services (0119): Specialised hearing services for children and adults with complex needs.
-
Hearing Services (0134): Hearing services for children and adults.
There are currently 14 different therapy support items in the Capacity Building Support Categories.12 These supports can be delivered to individual participants or to groups of participants. Where supports are delivered to groups of participants the hourly price limit is divided by the number of participants in the group. Price limits do not vary according to the
41
264 Page 62 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
Time of Day / Day of Week that the support is delivered. However, they do vary by state/territory and according to the Type of Therapist that delivers the support.
As well as direct service provision, therapists can claim for Non-Face-to-Face Support Provision, Provider Travel, Short Notice Cancellations and NDIA Requested Reports. They can also claim for any non-labour costs associated with claimable Provider Travel.
As Table 5 illustrates, there are separate price limits for supports delivered by:
-
Art therapists, Audiologists, Dietitians, Developmental Educators, Music Therapists, Occupational Therapists, Orthoptists, Podiatrists, Social Workers, Speech Pathologists and Other Professionals
-
Counsellors
-
Exercise Physiologists
-
Psychologists
-
Physiotherapists
-
Therapy Assistants.
TABLE 5: 2022-23 PRICE LIMITS FOR THERAPY SUPPORTS
| Type of Therapist | NSW / VIC / QLD / ACT | SA / WA / TAS / NT | Remote | Very Remote |
|---|---|---|---|---|
| Art Therapists | $193.99 | $193.99 | $271.59 | $290.99 |
| Audiologists | $193.99 | $193.99 | $271.59 | $290.99 |
| Dietitians | $193.99 | $193.99 | $271.59 | $290.99 |
| Developmental Educators | $193.99 | $193.99 | $271.59 | $290.99 |
| Music Therapists | $193.99 | $193.99 | $271.59 | $290.99 |
| Occupational Therapists | $193.99 | $193.99 | $271.59 | $290.99 |
| Orthoptists | $193.99 | $193.99 | $271.59 | $290.99 |
| Podiatrists | $193.99 | $193.99 | $271.59 | $290.99 |
| Social Works | $193.99 | $193.99 | $271.59 | $290.99 |
| Speech Pathologists | $193.99 | $193.99 | $271.59 | $290.99 |
| Other Professionals | $193.99 | $193.99 | $271.59 | $290.99 |
| Counsellors | $156.16 | $156.16 | $218.62 | $234.24 |
| Exercise Physiologists | $166.99 | $166.99 | $233.79 | $250.49 |
| Physiotherapists | $193.99 | $224.62 | $314.47 | $336.93 |
| Psychologists | $214.41 | $234.83 | $328.76 | $352.25 |
| Therapy Assistants — Level 1 | $56.16 | $56.16 | $78.62 | $84.24 |
| Therapy Assistants — Level 2 | $86.79 | $86.79 | $121.51 | $130.19 |
This chapter examines the pricing arrangements for therapy supports in the NDIS, including the extent to which they are appropriately aligned with those in comparable schemes, and with the private market for therapy supports.
5.2 Scheme Statistics
In the six months to 31 December 2022, 325,319 participants (57% of the 573,342 active participants as of 31 December 2022) purchased therapy supports through their plans. These supports were delivered by 46,434 providers who received a payment in the six months to 31 December 2022, a 14% increase to provider numbers from the same period in the previous year.
42
265 Page 63 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
Expenditure on therapy supports in the six months to December 2022 equate to $1.6 billion, accounting to almost 10% of all expenditure by the NDIS ($16.8 billion) during this six-month period, an increase of 26% from the same period in the previous year. More therapy support statistics can be seen in Table 6.
TABLE 6: THERAPY SUPPORTS SCHEME STATISTICS
| Statistics | July — December 2021 | July — December 2022 | Percentage Change |
|---|---|---|---|
| Total number of NDIS participants | 279,098 | 325,319 | +17% |
| Total number of active providers | 40,744 | 46,434 | +14% |
| Total amount claimed by active providers of Therapy supports | $1.3 billion | $1.6 billion | +26% |
| Number of active registered providers of Therapy supports | 8,833 | 8,900 | +1% |
| Number of active unregistered providers of Therapy supports | 32,133 | 38,114 | +19% |
| Average amount claimed by all active providers of Therapy supports | $31,627 | $34,947 | +10% |
| Total amount claimed by registered providers of Therapy supports | $0.99 billion | $1.16 billion | +18% |
| Average amount claimed by registered providers of Therapy supports | $112,093 | $130,738 | +17% |
| Total amount claimed by unregistered providers of Therapy supports | $0.29 billion | $0.45 billion | +55% |
| Average amount claimed by unregistered providers of Therapy supports | $9,043 | $11,790 | +30% |
Source: NDIS internal administrative data
Note: Please note the number of ‘active registered providers of Therapy supports and number of ‘active unregistered providers of Therapy supports’ do not align with the total number of ‘active providers’. There are two reasons for this; 1) One provider can provider multiple supports with being registered for some types of support provided and unregistered for others (different registration groups) in the same period so they are accounted for in both groups of providers; 2) Providers with the unknown registration are captured in total amounts but not presented in this table as they make up less than 1% of total payments.
Figure 13 shows the quarterly breakdown of the scheme expenditure on therapeutic supports and proportion of the overall scheme expenditure. Therapeutic supports make 9.7% or $817.1mil of total scheme costs for the period of October to December 2022. As shown on the chart above, these supports are hover around 9.4% of total scheme costs for last 9 quarters.
43
266 Page 64 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
FIGURE 13: NDIS EXPENDITURE ON THERAPY SUPPORTS SINCE DECEMBER 2020 QUARTER RELATIVE TO TOTAL NDIS EXPENDITURE
[$ Million chart summary: Total payments and Percentage of Total Scheme]
Source: NDIS internal administrative data
Participants
From the 325,319 participants with a claim for therapy supports from their plan in the six months to 31 December 2022, the most used therapist is for “Other Professionals” ($254.4 million claimed), followed by Occupational Therapists (for $280.9 million claimed) and Physiotherapy ($248.0 million). Noting participants can use and claim more than one type of therapist/therapy. A more detailed breakdown can be seen in Table 7.
The overall average payment for a participant receiving therapy supports in the six months to December 2022 was $4,988, up 8% compared to $4,617 in the same period the previous year. The average amount claimed per provider over this six-month period was $34,947, up 10% compared to the same period last year ($31,627).
TABLE 7: SCHEME EXPENDITURE BY TYPE OF THERAPY, JULY TO DECEMBER 2022
| Type of Therapist | Number of Participants | Number of Providers | Total Amount Claimed |
|---|---|---|---|
| Occupational Therapists | 162,532 | 7,279 | $280.9 m |
| Other Professionals | 179,476 | 25,544 | $254.4 m |
| Early Childhood | 69,250 | 10,362 | $248.0 m |
| Behavioural Therapists | 42,385 | 1,290 | $207.7 m |
| Physiotherapists | 85,965 | 10,249 | $166.5 m |
| Psychologists | 82,372 | 11,631 | $138.7 m |
| Speech Therapists | 89,033 | 5,896 | $135.4 m |
| Exercise Physiologists | 36,197 | 4,704 | $64.9 m |
| Therapy Assistants | 35,066 | 3,576 | $35.5 m |
| Counsellors | 20,043 | 4,552 | $26.9 m |
| Dietitians | 19,875 | 2,052 | $15.9 m |
| Social Workers | 8,101 | 1,356 | $11.4 m |
| Travel | 50,863 | 7,596 | $8.9 m |
| Miscellaneous | 4,628 | 2,777 | $7.4 m |
44 267
Page 65 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
FIGURE 14: TOTAL PAYMENTS FOR THERAPY SUPPORT ITEMS BY PROVIDER REGISTRATION, 2021 — 2022
Source: NDIS internal administrative data
In the six months to 31 December 2022, the top five types of therapists (excluding “Other Professionals”) claimed against in the NDIS, based on total payments, were Occupational Therapist ($280.9 million), Professionals delivering Early Childhood ($248.0 million), Behavioural Therapists ($207.7 million), Physiotherapists ($166.5 million) and Psychologists ($138.7 million). These five types of therapists accounted for $1.0 billion worth of claims, comprising 64%, close to two thirds of the $1.6 billion NDIS expenditure on therapy.
It should be noted that prior to 1 July 2022, many types of therapists did not have their individual support items and were included in the “Other Therapy” support. The breakdown of these types of therapists were not captured until after this date. Since 1 July 2022, it can be reasonably assumed that many of the supports delivered under “Other Professionals” were likely through Occupational Therapists and Speech Pathologists. The other most claimed types of therapies delivered appear to be relatively stable since December 2020 quarter. These are shown in Figure 15.
FIGURE 15: LARGEST TEN THERAPY TYPES BASED ON TOTAL PAYMENTS, OCTOBER 2020 — DECEMBER 2022
Source: NDIS internal administrative data
Note: Please note in the above chart Occupational Therapy and Speech therapy are introduced as standalone lines of supports from July 2022. Before July 2022 these lines of supports were claimed by providers under other groups of therapy without clear indicators of supports provided.
46
269 Page 66 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
This section has shown the increase in supply of providers delivering therapy supports to NDIS participants. However, with the growing number of NDIS participants receiving therapy supports, this may put pressure on the number of therapists required to continue supporting NDIS participants.
5.3 Employment Statistics
On current reported data through Australian Health Practitioners Registration Agency (AHPRA), as of February 2023, the Department of Health and Aged Care’s Allied Health Factsheets Dashboard³ stated there are:
-
41,791 Psychologists registered with AHPRA. The number of registrations grew by 20.3% between 2017 (34,752) and 2021.
-
38,882 Physiotherapists registered with AHPRA in 2021, up by 25.8% from 30,916 in 2017.
-
26,904 Occupational Therapists registered with AHPRA. The number of registrations grew by 33.6% between 2017 (20,145) and 2021 (26,904).
-
5,819 Podiatrists registered with AHPRA, up by 18.8% from 4,900 in 2017.
The total number of Psychologists, Physiotherapists, Occupational Therapists and Podiatrists registered with AHPRA has grown significantly in the last five years, up 26% from 90,713 in 2017 to 113,396 in 2021, whilst those registered with AHPRA and are employed has increased by 26% from 73,350 in 2017 to 92,406 in 2021 (see Figure 16).
FIGURE 16: NUMBER OF REGISTERED THERAPISTS, 2017 TO 2021
Source: Department of Health and Aged Care
Jobs and Skills Australia (formerly known as National Skills Commission) projects employment growth of the entire Australian workforce for five years to November 2026 at 9.1%. The growth in the therapy space will continue over this period with therapists making up three of the 11 fastest growing occupations, those being Audiologists and Speech Pathologists (34.7%, close to four times the projected rate of growth of the entire Australian workforce over that period), Podiatrists (31.8%) and Physiotherapists (28.7%), as shown in Table 8.
47
270 Page 67 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
TABLE 8: GROWTH IN EXPENDITURE ON THERAPY BY FUNDING SOURCE, 2016-17 TO 2019-20
| Occupation Code | Occupation | Employment level - November 2021 | JSA Projected employment level - November 2026 | JSA Projected employment growth - five years to November 2026 | JSA Projected employment growth - five years to November 2026 |
|---|---|---|---|---|---|
| 2527 | Audiologists and Speech Pathologists/Therapists | 12,300 | 16,600 | 4,300 | 34.7% |
| 2526 | Podiatrists | 6,400 | 8,500 | 2,100 | 31.8% |
| 2525 | Physiotherapists | 32,800 | 42,200 | 9,400 | 28.7% |
| 2522 | Complementary Health Therapists | 6,300 | 8,000 | 1,800 | 27.9% |
| 2721 | Counsellors | 24,400 | 27,800 | 3,500 | 14.2% |
| 2723 | Psychologists | 31,000 | 35,100 | 4,100 | 13.3% |
| 2524 | Occupational Therapists | 23,900 | 25,600 | 1,800 | 7.4% |
| 2511 | Nutrition Professionals | 7,900 | 8,500 | 600 | 7.2% |
Source: Employment Projections | National Skills Commission (now Job and Skills Australia)⁴
These projections highlight strong future demand for therapists in Australia, with the NDIS being one of the contributors to this demand.
5.4 Business Dynamism
Figure 17 shows the number of registered Therapy providers with the payments between June 2020 and December 2022, split by the number of half-year periods in which each provider received a payment. Half-years are defined as the six-month time intervals from January to June and July to December. As seen in Figure 17, 5,219 out of 12,112 (43%) registered providers have payments in all five half-years between June 2020 and December 2022. These providers account for 92% of the total payments across the two-and-a-half-year period.
FIGURE 17: REGISTERED THERAPY PROVIDER HALF-YEARLY PAYMENTS HISTOGRAM, JUNE 2020 — DECEMBER 2022
Source: NDIS Internal Administrative Data
48
271 Page 68 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
In order to further assess the health of the provider market, payment activities of registered providers across the two-year period from January 2021 to December 2022 were analysed. Providers with New Activity in a half-year are defined as providers with payments who did not have payments in the prior half-year. Similarly, Inactivity in the half-year is defined as providers without a payment who had payments in the prior half-year. Activity for each provider is expressed as a percentage of the total payments for that half-year (for New Activity) or prior half-year (for Inactivity). The NDIA acknowledges that this is not a perfect measure of market exits but the closest approximation given data limitations.
Results suggest that over the past two years, inactive registered providers in each half-year contributed to less than 0.7% of total payments. In contrast, registered providers with new activity in a half-year have contributed between 1.4% and 1.9% of total payments for that same period.
FIGURE 18: THERAPY REGISTERED PROVIDER ACTIVITY MOVEMENTS, JANUARY 2021 — DECEMBER 2022
Source: NDIS Internal Administrative Data
Further analyses indicate that on average, inactive registered providers received $4,234 in payments in the half-year prior to becoming inactive, with 84% of registered providers receiving less than $5,000 in the half-year prior to becoming inactive. In contrast, active registered providers received on average $107,199 of payments in each half-year period, highlighting that inactive registered providers have been claiming lesser amounts on average relative to new and existing registered providers.
5.5 Comparable Government and Funding Schemes
The NDIA conducted a comparison of therapy price limits and arrangements across public schemes. This is based on the NDIA’s calculations using information published by other schemes as at 31 March 2023; and additional information obtained directly through engagement with other schemes. The NDIA has engaged with sixteen Commonwealth and State Schemes to obtain their therapy pricing as comparison to NDIS limits.
The main MBS items for allied health have a scheduled fee of $65.85 per 20 minutes session. This equates to an effective hourly rate of $197.55 which is slightly higher than the NDIS hourly price limit. Note, the Commonwealth funding (MBS benefit) for the hour is $167.92, but co-payments are common in the MBS and the scheduled fee is a better
49
272 Page 69 of 134
s22(1)(a)(ii) - irrelevant material
Page 70 of 134NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
5.6 Private Billing Rates
This section analyses a data set of 6,053 private billing rates for therapy services, including 2,857 billing rates for weekday in-room services.
The private billing dataset was compiled by the NDIA by scanning provider websites across Australia. Prices for weekend, initial and telehealth consultations were excluded from the dataset. Outliers were also removed from the dataset⁵ as well as some therapy services, including teachers, personal training, osteopathy, and therapy assistants. The billing rates were converted to effective hourly rates based on the length of consultation. Some 34% of the sample observed billing rates were from non-metropolitan areas.
Among therapy services, the top four therapists in the sample were physiotherapists (17.6%), psychologists (15.2%) and clinical psychologists (10.2%) and dietitians (10.0%). Art therapists and music therapists each accounted for less than 3% of the sample. There were at least 80 observations for each type of therapists besides Art Therapists (33). Figure 20 displays the distribution of the sample for types of therapies, some of which have widely dispersed and significant overlap in pricing.
FIGURE 20: DISTRIBUTION OF RATES BY THERAPY TYPE
Source: NDIS Internal Administrative Data
The geographic distribution of the sample observations was slightly skewed towards Victoria (30% of the sample) and Queensland (32%) with New South Wales underrepresented (15%). Australian Capital Territory was the only state or territory with less than 30 observations (18). Figure 21 for the distribution of private billing rates across states, which show significant overlap in dispersion and overlap. It is also clear some states and territories show multi-model distribution in pricing (i.e., Northern Territory and Tasmania), which aligns to different pricing for different therapies in the sample.
51
274 Page 71 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
FIGURE 21: DISTRIBUTION OF RATES BY STATE
Source: NDIS Internal Administrative Data
Table 9 displays summary distributional statistics of the sample of private billing rates. The average effective hourly rate for weekday in-room therapists in the sample was $184 (median $185). The smallest effective hourly rate that was observed in the data set was $73 and the largest was $360.
TABLE 9: SUMMARY STATISTICS OF PRIVATE BILLING RATE SAMPLE, BY THERAPY TYPE
| Type of Therapy | Count | Mean⁶ | Standard Deviation | Minimum | 25th percentile | Median | 75th percentile | Maximum |
|---|---|---|---|---|---|---|---|---|
| Art Therapists | 33 | $140.2 | 39 | $73.3 | $100.0 | $135.0 | $177.5 | $216.0 |
| Audiologists | 90 | $194.6 | 26 | $156.7 | $175.0 | $187.5 | $210.0 | $240.0 |
| Counsellors | 186 | $138.8 | 36 | $75.0 | $120.0 | $140.0 | $160.0 | $220.0 |
| Dietitians | 287 | $174.9 | 41 | $80.0 | $140.0 | $180.0 | $210.0 | $280.0 |
| Exercise Physiologists | 190 | $140.7 | 36 | $73.3 | $119.0 | $134.2 | $167.0 | $227.0 |
| Music Therapists | 81 | $161.1 | 41 | $100.0 | $119.0 | $154.0 | $194.0 | $240.0 |
| Occupational Therapists | 237 | $169.3 | 42 | $75.0 | $140.0 | $172.0 | $194.0 | $264.0 |
| Physiotherapists | 502 | $183.9 | 51 | $75.0 | $150.0 | $180.0 | $220.0 | $322.0 |
| Podiatrists | 184 | $168.4 | 55 | $75.0 | $130.0 | $150.0 | $220.4 | $313.5 |
| Psychologists | 434 | $212.8 | 47 | $108.0 | $189.8 | $215.5 | $246.5 | $312.0 |
| Psychologists — Clinical | 292 | $258.4 | 42 | $150.0 | $228.0 | $260.4 | $291.6 | $360.0 |
| Social Workers | 107 | $169.2 | 49 | $93.3 | $120.0 | $156.2 | $216.0 | $312.0 |
| Speech Pathologists | 234 | $169.0 | 36 | $95.0 | $140.0 | $174.2 | $193.3 | $250.0 |
| Total Sample | 2,857 | $184.4 | 55 | $73.3 | $140.0 | $185.0 | $220.0 | $360.0 |
Statistical models were built for the private billing data set (see Table 10). A series of Tukey’s range tests were undertaken to group therapy types with similar private billing means. The test found that Audiologists, Dietitians, Music Therapists, Occupational Therapists, Physiotherapists, Podiatrists, Social Workers, Speech Pathologists (group 1 — base case) had similar means, while Counsellors, Exercise Physiologists and Art Therapists
52
275 Page 72 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
(group 2), also had similar means. The modelling began with indicator variables for each state/territory (model 1), plus a regional indicator variable (model 2) and one including the aforementioned variables and groups of therapies (model 3). Model 4 was also run that includes all states, a regional indicator and all therapy types individually, with New South Wales and Occupational Therapists as the base case. Sensitivity testing was also run on various interaction terms between the States and Territories, regional indicator and therapy types were also investigated, many of which were insginficiant.
TABLE 10: STATISTICAL MODELS OF PRIVATE BILLING RATES
| Variable | (1) | (2) | (3) | (4) |
|---|---|---|---|---|
| Constant | 193.1*** | 202.2*** | 188.9*** | 183.8*** |
| Victoria | -6.1 | -12.1*** | -8.9*** | -11.0*** |
| Queensland | -20.6*** | -20.8*** | -19.2*** | -18.4*** |
| South Australia | -3.3 | -9.2 | -10.9** | -12.4** |
| Western Australia | 3.0 | -3.4 | -7.5* | -7.6* |
| Northern Territory | -6.0 | -0.7 | -6.9** | 9.0* |
| Australian Capital Territory | 12.0 | 2.9 | 7.9 | -6.5 |
| Tasmania | 8.2 | 12.9 | 19.2** | 13.7* |
| Regional | -19.5*** | -11.9*** | -12.5** | |
| Exercise Physiologists, Counsellors & Art Therapists | -34.9*** | |||
| Psychologists | 38.7*** | 44.5*** | ||
| Clinical Psychologists | 80.7*** | 85.6*** | ||
| Art Therapists | -30.4*** | |||
| Audiologists | 25.9*** | |||
| Counsellors | -32.5*** | |||
| Dietitians | 5.4 | |||
| Exercise Physiologists | -25.3*** | |||
| Music Therapists | -3.9 | |||
| Physiotherapists | 12.8*** | |||
| Podiatrists | -1.1 | |||
| Social Workers | 3.5 | |||
| Speech Pathologists | -1.3 | |||
| Adjusted R² | 0.024 | 0.048 | 0.369 | 0.38 |
| F Statistic | 11.03 | 19.04 | 152.8 | 87.9 |
| Observations | 2,857 | 2,857 | 2,857 | 2,857 |
(* = p < 0.05, ** = p < 0.01, *** = p < 0.001)
Model 3 is preferred to Model 4 as the small increase in R-squared between Model 3 and Model 4 does not adequately compensate for many variables in Model 4 being insignficant at the 5% level.
The explanatory power of model is only 37%, which suggest that there are many other factors affect therapy pricing that are not currently captured in the model.
53
276 Page 73 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
The results suggests the average hourly price of $189 for the majority of therapists in New South Wales, with most other states and territories suggested to be at lower price. This suggests that the NDIS price limits are still adequate for most therapists. Results also suggest that price limits of non-clinical Psychologists, Counsellors and Exercise Physiologists appear on par with NDIS price limits.
5.7 Consultation feedback
Therapy supports were the most responded to topic, with 174 submissions out of 304 (57%) received through the Public Consultation responding to it. Many providers suggested theiggest cost driver has been the increasing supply costs and wages. Other costs faced involved attracting, training and retaining staff, as well as quality, safeguarding and compliance costs. Many participants and their representatives who responded to the Consultation Paper suggested that they were charged more than non-NDIS clients and generally supported no further price increase at this time.
See Appendix A for more details on common themes raised in submissions to the 2022-23 APR Consultation Paper.
5.8 Recommendations
On balance, available therapy data inputs suggests that the NDIS price limits for therapy supports remain adequate currently. Available evidence from comparable government and funding schemes and private market billing rates supports this.
This also considers the growing demand through NDIS participants claiming for therapy supports (17%) has also been relatively met with growth in the providers claiming for therapy supports in the NDIS (14%). There has been growth in several Therapy Professionals in the past few years, and further anticipated growth in the sector for several types of therapists in the coming years which should assist ease suggestions of workforce shortages that may exist in certain regions.
What is also evident is the vast and diverse nature of the therapy market and needs of NDIS participants. As the NDIS Review is currently examining non-price related solutions, the NDIA should consider structural changes to therapy pricing arrangements after any relevant recommendations from the NDIS Review.
Recommendation 6
The NDIA should not make any structural adjustment to the pricing arrangements for therapy supports at this time and should not index the price limits for therapy supports on 7 July 2023.
Recommendation 7
The NDIA should consider the structure of therapy support pricing arrangements after any relevant recommendations from the NDIS Review. This intends to better incentivise quality service provision to NDIS participants and intend to create greater market efficiencies.
54
277 Page 74 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
Therapy supports
There were 173 submissions related to Therapy supports. These were received from all stakeholder groups including, providers of both therapy and other supports, plan managers and other workers/employees, participants and/or their representatives, provider peak bodies, professional bodies, an advocacy group, and a government organisation.
Providers
Many providers claim the hourly rate for therapy services has not increased for three years and the cost of living has increased significantly, resulting in a rise in operational costs, rising material costs, and other associated costs. Time spent on administration, audit and liaising with support coordinators, families, and carers of participants is under-costed, and administration costs around intake are high but not claimable. There is the added problem of staff shortages with ongoing issues in retention and recruitment across the labour market in general.
Some providers argued that they charge a higher price for NDIS participants than non-NDIS clients due to the greater complexity in assisting them. On the other hand, some claimed there is no difference between the rates charged to NDIS and non-NDIS clients. A provider stated:
Our pricing rates for NDIS participants is slightly higher when compared to non-NDIS participants $150 ph however does not consider travel and the increased complexity clients with disability versus private clientele.
Several providers who responded stated that they charge NDIS price limits for exercise physiotherapy is less than other comparable schemes and stated that the NDIS price limit should be increased in line with other types of therapies.
Varying responses were received from providers regarding the proportion of therapy revenue that is derived from NDIS compared to other funding sources, ranging from 5% to 100%. Many providers reported approximately 80-95% of their revenue comes from NDIS participants, however, there are some providers who reported lower percentages, such as 5%, 20% or 33%. Providers of children supports were amongst those that reported 100%, whilst a psychologist reported as little as 5-10% comes from NDIS funding. The range in percentages highlights the diversity of therapy supports and the different ways in which providers rely on NDIS funding to support their services. Other sources of provider’s funding include private funding, MBS, My Aged Care and iCare.
Provider Peak Bodies
A major submission on the pricing arrangements for therapy supports was received from Ability Roundtable. They provided a report from Deloitte Access Economics who, in partnership with 13 participating organisations, updated their Allied Health Cost Model. The participating organisations collectively represent around 20% of NDIS therapy supports revenue. It is important to note that the providers in this study have a significantly different cost structure to many other therapy providers, who are typically much smaller.
Their Cost Model (as at 31 December 2022) identifies the baseline costs of service delivery for therapy supports under the NDIS, with a particular focus on large clinical training organisations. The report also draws on data from the Ability Roundtable’s Allied Health benchmarking group. Figure 34 provides some detail of the cost modelling undertaken by Deloitte Access Economics.
84
307 Page 75 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
FIGURE 34: DELOITTE ACCESS ECONOMICS ESTIMATED COST PER HOUR OF ALLIED HEALTH SERVICES UNDER THE NDIS, 2021 (LEFT HAND SIDE) COMPARED TO 2022 (RIGHT HAND SIDE)
Source: Deloitte Access Economics estimates based on information provided by the 13 organisations surveyed
*Notes: Four major allied health disciplines (excluding psychology) are the weighted average of social worker, speech pathologist, occupational therapist and physiotherapist. 2022-23 price limits are the calculated weighted average price limit for each group based on the location and allied health disciplines of organisations within the sample, using NDIS Pricing Arrangements and Price Limits 2022-23.
The key findings of the Deloitte Access Economics Report include:
-
At an overall level, the Cost Model shows that the fully loaded cost of service delivery in 2022 increased by approximately 3.7% for the four major allied health disciplines (excluding psychology) and 4.7% for psychology.
-
Labour-related costs increased by 15% for the four major allied health disciplines and 12% for psychology, primarily attributed to growth in wages and salary oncosts and investment in recruitment and training of new staff.
-
Overhead costs increased by 11% across all major allied health disciplines, primarily driven by growth in IT costs, HR costs and quality compliance costs.
-
To offset these impacts, providers found savings through operational efficiencies with improved utilisation rates, reduced spend on non-labour costs such as training and supervision, and back-office restructures.
Most providers surveyed suggest they are unable to break even as they are operating at costs above the current NDIS prices limits for therapy supports in 2022.
A peak body for early childhood intervention stated unfunded activities that are not billable include child protection referrals, involvement in subpoenas and family law court proceedings and mandatory reporting requirements.
Based on a small survey conducted by the National Disability Services (NDS), there are significant price gaps between NDIS price limits and the real costs of service delivery in various support categories. They mentioned:
The NDS State of the Sector (2022) report based on our Annual Market Survey shows that the past year has been a difficult one for providers. Operating conditions
85
308 Page 76 of 134
NDIA Board Meeting - 25 May 2023 - 9. Annual Pricing Review
2022-23 Annual Pricing Review
have generally worsened, and less than half of those responding to the Annual Market Survey recorded a surplus in the previous year.
Professional Bodies
Several professional bodies reported pricing arrangements for therapeutic supports under the NDIS are not reflective of true costs for providers especially when considering inflation, workforce shortages, impact of COVID and NDIS client complexity. These costs are felt more acutely in rural and regional areas due to factors such as competition around wages, housing shortages and increased costs of travel and consumables.
Many professional bodies suggested the increase in NDIS therapy support payments may be the result of increasing provider numbers and participants having more knowledge, choice and control over how they invest their funds. NDIS providers often provide unpaid or underpaid labour to subsidise a participant’s plan, which can impact their business and result in higher costs.
Allied Health Professions Australia (AHPA), who represents some 200,000 allied health professionals, stated data recently gathered from more than 700 speech pathologists, showed that less than a quarter report charging a higher rate for NDIS participants, with the majority charging all clients the same fee. Some therapy providers, particularly physiotherapists, report charging non-NDIS clients a higher fee, as it reflects the true costs of the service. The reasons given for charging higher fees include the complexity of the supports being offered, the level of skill involved and experience of the provider, and additional supervision and professional development requirements. Their submission states:
Therapy providers are overwhelmingly de-registering and choosing to see only self- managed and plan-managed clients due to the untenable burden.
Of those who are not registered, just under 95% indicated that they were not intending to register.
This was concurred by another peak body Speech Pathology Australia who also stated for those who do have differentiated prices, this was frequently referred to in terms of offering a discount to people and families who are unable to access any funding, and for whom therapy would therefore be out of reach.
The Australian Association of Psychologists Incorporated performed a survey in November 2022, with results indicating there has been a significant increase in demand for services in the disability sector. The psychologists’ recommended fees are considerably higher than the price caps for NDIS therapy items, suggesting that psychology is funded at levels that are low, given the education, training, and business costs associated with registration and practice as a psychologist.
Australian, New Zealand and Asian Creative Arts Therapies Association (ANZACATA), a professional body on creative arts therapies, stated that group Art Therapy services under the NDIS is not viable due to the use of more materials, time spent writing more case notes, and the expertise required to facilitate and keep participants safe. The episodic nature of psycho-social disability and its impact on service provision also poses a challenge as participants often have irregular attendance patterns, making it hard to support regular work conditions and contracts and attract staff.
Participants
86
309 Page 77 of 134
s22(1)(a)(ii) - irrelevant material
Page 78 of 134