Occupational therapist highlights clinical concerns regarding functional capacity assessment thresholds (Provider experience)

Submission 2754

SUBMISSION TO THE SENATE COMMUNITY AFFAIRS LEGISLATION COMMITTEE

Inquiry into the National Disability Insurance Scheme Amendment

(Securing the NDIS for Future Generations) Bill 2026

Submitted by: Senior Occupational Therapist, Canberra

Date: 1 June 2026  | Submission to the Senate Community Affairs Legislation Committee

About This Submission

I am a Senior Occupational Therapist working within the NDIS for the last three years, primarily with adults with intellectual disability, autism and psychosocial disability. My clinical practice involves direct assessment and therapy with NDIS participants, including functional capacity assessments, home and living assessments, capacity building, and the preparation of reports that inform planning decisions. I work daily with people whose lives depend on the supports the NDIS funds, and whose futures will be directly shaped by this legislation. This submission responds directly to the key provisions of the National Disability Insurance Scheme Amendment (Securing the NDIS for Future Generations) Bill 2026. I write with significant clinical concern. This Bill, as drafted, will not simply reform the NDIS, it will cause measurable, foreseeable harm to people with disability.

1. The New Eligibility Framework and Functional Capacity Definition (Schedule 1, Part 1)

The Bill introduces a new legal definition of functional capacity, assessed without assistive technology, home modifications, support workers, or environmental context. It raises the threshold to substantially reduced functional capacity as the basis for NDIS access, and commissions a Technical Advisory Group to design the assessment tool.

Clinical Concern: The Assessment Method Contradicts OT Best Practice

Stripping out assistive technology and environmental supports to establish a baseline is conceptually defensible in isolation, and I acknowledge that assessing someone already using their funded supports risks underestimating underlying need. However, this definition does not exist in isolation. It will be used by an algorithm-informed system to determine eligibility for the very supports that were stripped from the assessment. Using an occupational therapy lens, functional capacity is always contextual. The same person in a different environment, with or without adaptive equipment, and depending on the potentially fluctuating nature of their disability, will present entirely differently. The proposed

assessment  tool  risks producing results  that bear no relationship to how  disability  is

experienced in daily life. The idea of a single tool that can assess and capture a person’s support needs is not only unrealistic, but ethically unsound. There are multiple different ways of capturing functional capacity for a reason, and clinical judgement must always be part of the equation. No single eligibility instrument can validly account for fluctuating disability impacts, environmental context, risk, fatigue, cumulative load, communication barriers, or the lived complexity of disability across settings. The solution to reducing assessment costs is not to force complex lives through one standardised gate. It is for the department to actually read and accept the recommendations made by health professionals who know their participants, rather than requesting lengthy and overly detailed reports that are ignored, which regularly results in underfunded needs and increased legal costs through the Administrative Review Tribunal.

Submission 2754

Clinical Concern: The ‘Substantially Reduced’ Threshold Will Exclude People

Who Cannot Manage Without Support

Many of my clients would not meet a substantially reduced threshold on a test conducted in a controlled setting while assessed in isolation. Yet without NDIS supports, they are unable to safely manage daily living, maintain their health, access their community, or avoid acute crisis. The threshold, as drafted, will exclude people who are genuinely disabled and genuinely dependent on support. I have assessed participants where the gap between can technically perform the task and can safely and sustainably perform the task across a full day, week, and year is the entire clinical picture. Fatigue, pain, cognitive load, the cumulative cost of compensatory strategies- none of these are reliably captured in a point-in-time, stripped-context assessment. The Bill creates legal eligibility criteria that clinical assessment cannot accurately map onto. Recommendation: The Bill should not proceed on the basis of a single eligibility

assessment  tool.  Eligibility must remain grounded in multidisciplinary  clinical

evidence, real-world functional context, and professional judgement, rather than a standardised instrument that cannot ethically or practically capture the complexity of disability.

2. Restrictions on Unscheduled Plan Reassessments (Schedule 1, Part 2)

   The Bill restricts unscheduled plan reassessments so they can only be requested by

participants, nominees or guardians, and only where there have been significant and ongoing changes to functional capacity. This removes the ability of allied health professionals, treating clinicians, and support coordinators to initiate reassessment based on observed deterioration or identified underfunding.

Clinical Concern: Clinicians Are Best Placed to Identify When Plans Are Unsafe

In my practice, I regularly identify that a participant’s existing plan is clinically unsafe. Not because the participant has requested a review, but because my assessment has revealed that their current supports are insufficient to meet their needs. The participant may lack the capacity, the advocacy, or the awareness to initiate a request themselves. Reassessments are so frequently required because the NDIA ignores recommendations for supports in FCAs, leading to underfunded or overly structured plans that do not allow participants to access the real world supports they actually need. Restricting reassessment to participant-initiated requests removes a critical clinical safeguard.

Participants  with  significant  cognitive  impairment,  psychiatric  disability,  or  complex

communication needs are precisely the people least likely to self-advocate for a plan review, and most likely to be harmed when their plan is wrong.

The government's own data indicates  that 20%  of plans are subject  to unscheduled

reassessment annually, and the average result is a 20% increase in plan value. This does not indicate wasteful or fraudulent claims. It indicates a planning system that is systematically underfunding participants, and a review process that is correcting those errors. Restricting reviews will not fix underfunding. It will simply prevent it from being corrected. Recommendation: Allied health professionals, treating clinicians, and support coordinators must retain the ability to initiate plan reassessment where their clinical assessment identifies that a plan is unsafe or insufficient to meet a participant’s needs.

Submission 2754

3. Tightened ‘Reasonable and Necessary’ Criteria (Schedule 1, Part

The Bill clarifies that supports will only be funded where the need arises directly from the impairment for which the participant met access criteria. This appears on its face to be a reasonable boundary. In practice, it will produce arbitrary and harmful outcomes.

Clinical Concern: Disability Is Not Compartmentalised

Disability does not present in neat categories that can be traced to a single impairment. A

participant  with acquired  brain  injury may have  physical,  cognitive,  behavioural, and

psychosocial support needs that are functionally inseparable. A participant with cerebral palsy may develop secondary musculoskeletal complications, fatigue disorders, or mental health conditions that are directly caused by, or exacerbated by, the primary impairment. These conditions also affect the person’s cerebral palsy and their overall functioning. Requiring that each funded support be traceable to the specific impairment on the participant’s access notice will generate disputes, delays, and denials for people with complex and evolving presentations. It will require participants to fund additional clinical evidence to link secondary needs to primary impairments- evidence that is expensive, time-consuming, and will itself be funded from participant plans. I already work with clients who spend a significant proportion of their plans on the assessments and reports required to justify their existing supports. This provision will increase that burden substantially, while disproportionately affecting the most complex and vulnerable participants.

Recommendation: The  Bill should  explicitly  recognise  that secondary and

consequential support needs arising from a primary impairment are within scope, and that the causal relationship between impairment and need does not need to be narrow or direct.

4. Ministerial Power to Cap Category Budgets (Schedule 1, Part 4) The Bill gives the Commonwealth Minister power to set funding caps within support categories by legislative instrument, without individual assessment, without parliamentary disallowance, and with automatic application to all participants in that category. Plans would auto-renew with the reduced funding in place indefinitely.

Clinical Concern: Population-Level Cuts Override Individual Clinical Need

This provision removes the clinical foundation of the NDIS. The scheme was built on the premise that individual support needs are individually assessed and individually funded. A ministerial instrument that reduces a support category by an arbitrary percentage and applies it simultaneously to every participant in that category has no relationship to clinical need. As an occupational therapist, my recommendations are based on individual assessment. A funding cap that overrides those recommendations without clinical review is not a reform. It is a budget tool dressed as policy. The participant whose plan auto-renews at a reduced level has no mechanism for correction under this provision, and the clinical evidence that justified the original funding level is rendered irrelevant by ministerial discretion. Recommendation: Any ministerial power to adjust support category funding must require individual review before applying to any participant, and must be subject to

parliamentary  disallowance.  Auto-renewal  with  reduced  funding,  without

reassessment, must not be permitted.

Submission 2754

5. The Cut to Social and Community Participation and Capacity Building (Budget Reset from October 2026)

Separate from but associated with the Bill, the Government has announced a progressive reduction of participant budgets for social, civic and community participation supports and capacity building daily activities from 1 October 2026, with some participants facing reductions of up to 50%.

Clinical Concern: These Are Not Discretionary Supports

Social and community participation and capacity building are not luxuries. For many of my clients, these are the supports that enable them to leave the house, do their grocery shopping and attend medical appointments, maintain relationships, develop skills, engage in meaningful occupation, and sustain their mental health. Removing them does not make these needs disappear. It transfers them. Occupational therapy is grounded in the understanding that participation in meaningful activity is not ancillary to health; it is health. Social isolation is a documented contributor to physical

and  psychiatric  deterioration,  hospitalisation, medication  overuse,  carer  burnout, and

premature mortality. Cutting participation supports will produce all of these outcomes. The costs will appear in hospital emergency departments, mental health inpatient units, aged care facilities, and on welfare benefits and Centrelink caseloads, not in the NDIS budget.

6. The True Cost of These Changes: What the Budget Does Not

Count

The Government has cited $37.8 billion in projected savings from these reforms. What it has not published is the downstream cost to other systems when NDIS supports are removed. I see this cost transfer in clinical practice every week. When a participant loses their community access support, the first call comes to the family carer. When the carer can no longer cope, the next call goes to the emergency department. When the ED cannot manage a complex disability presentation, the patient is admitted. When the admission extends because there is no safe discharge destination, the cost compounds. When the carer breaks down, they present to mental health services. When the participant is eventually placed in residential aged care, at a fraction of their actual age and with decades of life ahead, the cost is borne by the aged care system. Additionally, informal carers and people with disability will need to drop out of the workforce when the person they care for loses formal supports, significantly reducing economic participation. None of those costs appear in the NDIS budget line. All of them are paid by Australian taxpayers. The Government is not saving $37.8 billion. It is shifting costs to systems that are already under-resourced, less appropriate for the people receiving care, and, in aggregate, more expensive. The Productivity Commission’s foundational economic argument for the NDIS was that investing in formal supports reduces the catastrophic downstream cost of informal carer breakdown and crisis-driven system use. These reforms legislatively reverse that rationale without accounting for the costs that will follow. I am asking this Committee to require the Government to table a whole-of-government cost impact analysis before this Bill proceeds — one that models the projected increase in demand across hospital emergency departments, mental health inpatient services, aged care,

Submission 2754

housing, Centrelink, and the justice system as a direct consequence of the supports this Bill removes or restricts. Without that analysis, this Committee is being asked to evaluate a savings claim that counts only one side of the ledger.

7. The Cost of Administrative Burden: Money Spent on Process

Instead of Support

A major cost driver in the current NDIS is not participant need. It is administrative churn created by the NDIA’s own decision-making processes. When plans are underfunded, when clinical reports are requested and then not meaningfully considered, and when participants are forced into internal reviews and Administrative Review Tribunal proceedings to secure supports that should have been funded correctly in the first instance, public money is being spent on bureaucracy instead of disability support. That burden is visible across the scheme. Participants pay for repeated functional capacity assessments, updated specialist reports, support letters, and case coordination simply to restate needs that are already well documented. Clinicians spend more funding (or unbillable or poorly compensated time) re-explaining the same recommendations in different formats to satisfy shifting evidentiary expectations. Families lose hours to phone calls, portal uploads, complaints, review requests, and hearings. Government then pays again through NDIA staffing, legal teams, review processes, and publicly funded advocacy and appeal supports. None of this improves functional outcomes. It is transaction cost generated by administrative failure. Public evidence already points in this direction. The dispute resolution system has recorded large volumes of review matters, with cases previously reaching around 4,500 in the former AAT pathway, and the Commonwealth continues to fund dedicated NDIS Appeals Program advocacy for people challenging NDIA decisions. At the same time, senior NDIA leadership publicly acknowledged in February 2025 that planners cannot realistically read very long reports. Reports are getting longer because of the number of times recommendations are declined based on “lack of evidence”. Taken together, this describes a system that requires expensive and overly detailed evidence, often fails to engage with it properly, and then incurs further cost resolving the predictable disputes that follow.

Recommendation: The Committee  should examine  the  full  cost  of NDIA

administrative burden, including repeated evidence requests, internal reviews, tribunal matters, legal expenditure, and participant-funded report writing. Scheme sustainability cannot be assessed honestly if administrative waste is counted as participant cost.

8. The Devaluation of Allied Health Evidence The Bill and the reforms accompanying it further entrench a tension that is already damaging in practice: the NDIA mandates expensive clinical evidence, then does not act on it. The NDIA CEO acknowledged publicly in February 2025 that staff often do not have time to read the reports submitted by participants. The planning system already produces outcomes where two participants with identical disabilities, identical functional capacity assessments, and identical allied health recommendations receive entirely different plans, based on which planner they are assigned. This Bill replaces human planners with algorithmic decision-making. It does not fix the problem of evidence not being read. It removes the human being who at least had the capacity to read

Submission 2754

it. Participants will continue to fund occupational therapy assessments, functional capacity reports, and specialist evaluations, and those reports will now be processed by a system with no demonstrated ability to interpret and appropriately weight clinical complexity. Occupational therapists are the profession most frequently called upon to provide the evidence that drives NDIS planning decisions. We see the gap between what the evidence says and what the plan funds. That gap is not closing under these reforms. It is being legislated. Recommendation: Any algorithmic planning tools must be subject to mandatory independent clinical audit before implementation, with ongoing auditing against

clinician-recommended    funding    levels.    Allied    health    professional

recommendations must be a required input, not an optional one.

Conclusion and Recommendations

I am not opposed  to reform. The NDIS has genuine design  failures. Fraud  is  real.

Inconsistency  in planning  is  real. The scheme needs structural improvement. But the

provisions of this Bill, as drafted, will not fix what is broken. They will harm the people the scheme was built to serve. My recommendations to the Committee are as follows:

• Do not pass this Bill in its current form.

• Require a whole-of-government cost impact analysis before any vote, modelling downstream costs across health, aged care, mental health, housing, and income support systems.

  • Reject any model that relies on a single eligibility assessment tool, and require

eligibility decisions to remain grounded in multidisciplinary clinical evidence, real-world functional context, and professional judgement.

• Restore the ability of clinicians and support coordinators to initiate plan reassessment where clinical assessment identifies unsafe or insufficient plans.

• Remove the ministerial power to cap support category budgets without individual review and without parliamentary disallowance.

• Explicitly protect social and community participation supports for participants whose clinical need for those supports is evidenced.

• Require NDIA planners and algorithmic tools to demonstrate engagement with allied health evidence, with accountability mechanisms for decisions that are inconsistent with clinical recommendations.

• Require transparent reporting on the administrative cost of NDIA decision-making, including repeated evidence requests, internal reviews, external appeals, and legal expenditure generated by incorrect or inadequate planning decisions.

Submitted: 1 June 2026