Price regulation and funding adjustments to assist struggling NDIS participants/providers
Government/Department
This submission will appeal to the Federal joint standing committee on the National Disability insurance Scheme in particular their inquiry into general issues around the implementation and performance of the NDIS. This submission concerns the honourable Stuart Robert of whom is the federal minister for the NDIS whose profile is situated in the federal Department of Social Services.
Summary (Terms of reference)
Currently participants and providers are struggling and ill prepared to engage in the NDIS system. Despite the NDIS’S implementation in 2013 there is still widespread service ambiguity and operational inefficiency. Until the system is entirely deregulated there needs to be more flexibility and investment for both participants and providers who are struggling in this system. Given that participants of this scheme cannot effectively engage with the very system with which it was designed for, more needs to be done. There are several areas which could be addressed to assist participants and their families. Currently with core budget, capacity building and capital funds supports, participants can not utilise funding across these funding streams. There are also some problematic considerations relating to price regulation for both participant and provider given the current market. Proposed changes to price regulation and funding adjustments are needed to increase value for participants and to make the road to deregulation sustainable for providers.
Changes are warranted
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Immediate funding flexibility for core budget, capacity building and capital funds. This proposed policy recommendation would assist participants, subsequently making support coordination more effective and worthwhile for personalised plans.
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Three year regulation of funding supports for participants. This proposed policy change would ensure that there is one maximum price control for all supports as opposed to having maximum prices and price benchmarks for specific goods and services. Given the current macro service provision this policy recommendation would ensure certainly and reassurance for participants and their families.
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Increased maximum prices to benefit disability providers. Despite exponential growth in the disability sector, disability providers are struggling to operate under unrealistic maximum prices for supports. In conjunction with policy recommendation two, this recommendation would validate current service provision of which is overworked, understaffed and untrained.
Costing/resourcing and impact
For the first policy recommendation because it is in context to pre-existing funds, this recommendation will require immediate administrative change to care coordination financial cost however will be minimal. For the second and third policy recommendations this will require significant financial investment made to approximately 470,000 personalised plans as well as impacting on approximately 2300 registered Disability providers nationwide. Minimum cost will be 2.5 billion over the course of three years.
Recommendations
It is recommended that the NDIA adopts the first policy recommendation as soon as possible within the current financial year and the second and third in the next financial year.
Introduction
My name is Matthew Paul and I am a Disability support Worker who is studying a bachelor of Social Work (hons) at RMIT University. I am writing to the committee’s submission criteria of how participants have received and used their package of supports as well as how service providers are finding the transition to the new scheme.
I currently work for St John of God Accord in a part time position in both their Sydenham community campus and more recently in accommodation situated in Blackburn. I have also worked for Yooralla as a disability support worker since 2016 in both a part time (2016-2018) and currently casual position (2018-present). This role has allowed me the opportunity to work in a variety of different locations such as; St Albans, Fawkner, Box Hill and Rochester. I have also worked with Scope between 2016-2018, in a casual position situated in their respite house in Melton. I am not representing these organisations in this submission and am sending an individual submission of my own accord. My experience with these organisations has afforded me the privilege to work with a diverse range of participants and their families. As I have worked predominantly in the western suburbs of Victoria, I have seen first-hand participants’ transition into the NDIS system and am confident this experience has provided me genuine and authentic insight which can assist the committee’s inquiry.
Background and issues
The support coordination of personalised supports is operating in uncertain and ambiguous service delivery for participants and providers alike (Metherall, 2018) . As it stands the National Disability Insurance Scheme (NDIS) provides funding for participants to access “reasonable and necessary supports” which assist participants up to the age of 65 who have a “permanent and significant disability”. There are several support budgets (streams) which are; core budget, capacity building and capital funds (Foster et al., 2016, Reddihough, Meehan, Stott & Delacy, 2016). Under the National Disability Insurance Scheme act 2013 these funding provisions validate the participant’s right to pursue their potential as well as to contribute to social and economic life to the extent of their ability. Despite the validation of participant autonomy, promotion of value for money transactions and a healthy/competitive free market, there are several problematic considerations (Foster, 2016)
- Within the core budget and capacity building streams (with specific exceptions such as transport and support coordination) participants and their families can flexibly utilise allocated funding for certain sub categories into another sub category (“Plan budget and rules | NDIS”, 2020, “Support budgets in your plan | NDIS”, 2020)
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Despite these provisions participants can not utilise funding across the three major funding streams.
For example participants can not flexibly allocate funding for core budget into capacity building and visa versa (“Plan budget and rules | NDIS”, 2020, “Support budgets in your plan | NDIS”, 2020). This presents itself as a missed opportunity for participants to maximise their allocated funding to its greatest potential.
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The National Disability Insurance Agency (NDIA) have maximum price controls to ensure providers “cap” prices only for specific supports and services across these funding streams (“Plan budget and rules | NDIS”, 2020, “Support budgets in your plan | NDIS”, 2020). As it stands despite maximum prices and recommended price benchmarks, participants (especially those wo are self-managing) are struggling to navigate a complex and intimidating system one in which they are left vulnerable to cost blowouts and unfair price negotiation (Carey, Malbon, Weier, Dickinson & Duff, 2019). As there is widespread inefficacy and operational ambiguity for participants and their families, they are not getting value out of their participation (Metherall, 2018)
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Disability providers in the NDIS are currently struggling to be financially sustainable with 50-75% operating at deficit (Knaus, 2017, Carey, Malbon, Weier, Dickinson & Duff, 2019, Coote, 2019). Many providers feel that current pricing is unrealistic and does not adequately reflect overworked and backlogged service delivery (Knaus, 2017, Carey, Malbon, Weier, Dickinson & Duff, 2019, Coote, 2019). Although demand and investment are growing, providers are ill-equipped and ill prepared to operate effectively in the NDIS system as well as operating in a competitive “business like” free market (Carey, Malbon, Weier, Dickinson & Duff, 2019).
Until there is more stability and consistent operation in the NDIS system, participants and their families must have every opportunity to maximise the full potential of their allocated funding and be protected via price regulation (Metherall, 2018). Persons under the age of 65 who have a “permanent and significant” disability are one of the most socioeconomically disadvantaged and vulnerable groups in Australia (Disability statistics, 2019, Shuttleworth, 2016, Sackville, 2019. More specifically the poverty rate among households that depend of allowances such as Newstart and the Disability pension as their primary income has risen from 39% in 1993 to 80% in 2017 (“Poverty and Disability – Fast Facts | Australian Federation of Disability Organisations”, 2020. This does not take into account the disproportionate extra costs to living which many participants of the scheme
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and their family’s experience (“Poverty and Disability – Fast Facts | Australian Federation of Disability Organisations”, 2020). Even if companies charge the maximum price of regulated goods and services, this will still give participants and their families more power and discourage fraudulent companies of more income. This is needed with a rising demand/growth in the disability sector coinciding with a current trend of increased fraud in the NDIS system (Australian Broadcasting Commission News, 2019, Johanson, 2019, Henrique Gomes, 2020). As such participants and their families will welcome proposed changes to this area and benefit significantly.
In addition current registered disability providers of whom number approximately 2300 nationwide and 650 in Victoria are significant parties to this issue will also welcome these policy changes (Bowen, 2016). Although funding flexibility across the listed budget streams is an issue for support coordination services (which are integral to NDIS operation), more regulation for supports would be opposed because providers are currently under extreme pressure to work with costs not reflective of current operations (Knaus, 2017, Coote, 2019). In conjunction to this providers would welcome increased maximum prices of all regulated supports.
Response
Immediate funding flexibility for capital supports.
The most plausible recommendation is to allow participants and their families to flexibly utilise allocated funding across the three main funding streams (core budget, capacity building and capital funds) rather than only allowing flexibility to reallocate funding within each funding stream. This would assist participants to get more value out of their immediate funding in context to their needs and goals (“Plan budget and rules | NDIS”, 2020, “Support budgets in your plan | NDIS”, 2020). This proposed policy recommendation would assist all three levels of support coordination such as; support connection, support coordination and specialist support coordination (“Support coordination | NDIS”, 2020). If there was more flexibility of funding allowed across the three main funding budgets, then support coordinators and participants could achieve more with the allocated funding they have. In addition this would also significantly assist 11% of total participants who are self- managing their own plan of whom have to source their own supports and negotiate with providers (Carey, Malbon, Weier, Dickinson & Duff, 2019). Although this would improve the day to day operations and experiences of managing NDIS plans, it would require more training and briefing especially with participants who are self-managing their own plans and are not with the NDIA or a registered disability provider (“Support
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coordination | NDS
Impact and resourcing
The NDIS will cost approximately $21.5 billion as of the 2019–2020 financial year, which is approximately 1.1% of total GDP (“Paying for the National Disability Insurance Scheme – Parliament of Australia”, 2020). All three policy considerations would assist 475,000 participants who are in the scheme as well as approximately 2,300 registered disability providers nationwide(Bowen, 2016). Because it concerns the flexible use of pre-existing funding, costing for the first policy recommendation would be negligible. This would allow more money to be spent into the disability sector, which is currently experiencing exponential growth (Bowen, 2016).
For the second and third policy recommendations previous price increases made to therapy supports, attendant care and community participation had minimum costing between $500-850 million over the next financial year(Coote, 2019 ). In consideration that these policy recommendations would temporarily regulate and increase maximum prices of all supports for three years, the costing of these recommendations would be significantly more. As such a minimum estimate of enacting these recommendations would be $2.5 billion over the course of three years.
In consideration of these recommendations
- There was a shortfall of $3.8 billion in Federal Government spending for 2018–2019 financial year in comparison to the previous financial year(Michael, 2019)
- Approximately 50–75% of disability providers reported a financial loss despite exponential growth in the sector(Carey, Malbon, Weier, Dickinson & Duff, 2019).
- A survey in 2019 showed 60% of participant did not have effective access to support services with only 30% having equipment they desired(Henrique Gomes, 2019)
Implementation and evaluation
Because it relates to increasing the flexible usage of pre-existing funding/supports the first policy recommendation could be implemented as soon as possible within this current financial year of 2019-2020(“Annual price review | NDIS”, 2020, “Plan budget and rules | NDIS”, 2020). With regards to the second and third policy recommendations because their implementation would have a significant impact on fiscal cost and budgeting, they would need to effectively be carried out in the 2021-2022 financial year and onwards. As the price guide and support catalogues are about to be released for the 2020-2021 financial year, the time frame for these policy recommendations would have to be implemented between 2021-2022 up until the 2023-2024 financial year(“Annual price review | NDIS”, 2020, “Plan budget and rules | NDIS”, 2020).
Because these policy recommendations concern reducing administration costs and the adequacy of pricing frameworks, there are appropriate mechanisms of review already in place via the NDIA’s price review consultation process(“Annual price review - consultation | NDIS”, 2020). The NDIA has adequate means as to survey and consult providers as demonstrated last year via their survey of 667 providers in context to current prices and operating sustainably (Michael, 2019). Benchmarks of assessment would include how satisfied/secure participants feel with being in control of their funding and how satisfied providers feel administrative/service delivery costs are reflective of NDIS pricing limits . These benchmarks could also be expressed via the NDIS’s complaints system however It is expected that these temporary recommendations would be well received by providers and participants(“Feedback and complaints | NDIS”, 2020).
Conclusion.
Despite its implementation almost 10 years ago participants and disability providers are not ready for the NDIS’S eventual deregulation. Despite exponential growth in the sector and significant investment from both Federal and State Governments, participants and providers are still struggling to adjust to the system and remain sustainable. Many participants who disproportionately face numerous inequalities/discrimination are having difficulty navigating the NDIS and maximising their allocated funding. Many disability providers in the sector are also charting new territory in facing these uncertainties but are also running at a loss needing assistance/intervention. Although the NDIS is a brave new world with much to look forward to, participants and providers currently remain fearful and uncertain with more needing to be done to assist them.
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