New NDIS Price Guide: What It Means For Providers
The NDIA has delivered some welcome news to providers following an Independent Pricing Review (IPR) – 10 of which will come into effect from 1 July 2018.
There’s no doubt that yesterday’s news announcing the NDIA’s acceptance of the IPR’s pricing recommendations demonstrates its willingness to take ‘bigger’ steps in the right direction. With capped hourly rates and tight worker-participant ratios making things difficult, many provider services have struggled to survive, let alone prosper. With some key funding increases to come into effect almost immediately (and in much needed areas) many providers will be a little happier leading into the new financial year.
However, there is a strong argument that the NDIS pricing model should take into account deeper considerations. The argument around ‘what hourly rate is adequate to operate a service’ must go beyond simple operational viability and include a broader perspective around the other challenges facing providers. The immediate challenges (and required supports) for disability service providers will generally depend on which of two groups they fit in:
- New businesses trying to establish their services. Like any new business, half the battle is getting the service off the ground, let alone building efficient internal processes, employing staff and ultimately being able to compete effectively. Conservative profits can make it particularly hard for these services to survive long-term as they build their client bases.
- Established, larger non-government organisations trying to transition from existing ‘block funding models’ to the new world of participant-managed funding. Many organisations have simply had to close down with no clear way to survive once the money runs out. Those who are pushing through are having to diversify their services, invest heavily in marketing to reposition themselves and look for ways to build internal capacity.
While the 2018/19 NDIS Price Guide has taken into account operational margins, there’s been little provision to support services across both groups and help them manage these challenges. And, as the NDIS market grows with ever-increasing numbers of participants and service providers, the Federal Government continues to juggle the Scheme’s affordability while trying to build a long-term, self-sustaining marketplace for the future – and this has proven much more difficult, particularly given the fast pace of the rollout.
While there are no immediate solutions, the Government’s ‘guarantee’ of the Scheme means the only way to move is forward and the Scheme, its participants and providers will need to find a way through.
Below are the 10 changes to come into effect from 1 July, 2018.
The Independent Pricing Review (IPR) highlighted the difficulty that participants (who do not live in a metropolitan area, but are not considered remote) may have with accessing supports.
- Providers will now be able to charge up to 45 minutes of travel time in rural areas with more specific arrangements for remote areas to be implemented in the not too distant future.
The IPR highlighted the inconsistency between charges for high intensity or complex requirements for group based supports in a centre compared to other core supports.
- New price limits will be introduced for both standard and high intensity community-based group supports, to allow for support ratios of 1:4 and 1:5 (i.e. worker:participant ratio).
- A capital allowance will be included in the price limits for centre-based group care.
Short Term Accommodation
The IPR report recommended the NDIA address the update made to price limits for STA to ensure they reflect the costs of delivering the service.
- A new price limit will be added for STA to allow for a 1:3 support worker to participant ratio.
Temporary Support Overhead
The IPR recognised the time and effort it takes for providers to establish efficient systems and processes to support the roll out of the NDIS.
- 2.5 per cent loading will be added to standard intensity attendant care supports, helping to support providers transition their business to the NDIS funding model.
Cancellation policy for core supports
The IPR highlighted the inefficiencies that last minute cancellations cause for providers.
- Providers will now be able to charge 90 per cent of the service booking price for short notice cancellations, up to a maximum of 12 cancellations per year for core supports and 6 hours per year for therapy.
Group supports (community based) / Group supports (centre based)
The IPR report suggested the current price limits for group supports did not allow for sufficient flexibility in group care arrangements.
- New price options to support 1:4 and 1:5 support worker to participant ratios for both standard and high intensity rates will be added to the 2018/19 NDIA Price Guide.
Therapy assistant (level 1)
The IPR suggested an increase to the price limit and the inclusion of a second tier of the therapy assistant rate would result in improved participant outcomes.
- The hourly rate for therapy assistants (Level 1) will be increased to align with the rate for a standard level support worker.
The IPR report found that participants living in regional areas may find it difficult to access therapy supports.
- The NDIA will now remove the $1,000 cap for therapist travel.
- Therapists can now claim for travel up to 45 minutes when visiting participants in regional areas, and up to 20 minutes for all other areas.
Cancellation policy for therapy
The IPR highlighted the inefficiencies that last minute cancellations cause for therapists.
- Therapists will now have the option to charge 90 per cent of the service fee for a participant who cancels an appointment at short notice.
Reports requested by NDIA
The IPR report acknowledged the out of pocket time and resources for providers when supplying reports that are requested by NDIA.
- To acknowledge this providers will now be able to claim for:
- Reports requested at the commencement of a plan which identify goals and objectives
- Reports requested at plan review to measure progress against those goals
- Any other report as stipulated within participant plans.