Increased NDIS payments
The Federal Government has announced price increases for NDIS services on 30 March to come into effect on 1 July 2019. The price increases will inject more than $840 million into the NDIS market and we hope this will provide some relief for providers who struggle to deliver financially sustainable, quality services under the current pricing arrangements.
Pricing of Assistance with Daily Living and Assistance with Community Participation
The NDIA has published some of the changes ahead of the release of new NDIS Price Guide. Prices of Assistance with Daily Living and Assistance with Community Participation will increase as outlined below. The calculations are based on current base prices and the correlating support categories are our interpretation of the NDIA communication.Base prices are the prices stated in the February 2019 Price Guide less the Temporary Support for Overheads (TSO) of 2.5%, which will be removed as of July. The increases are indicative as they do not yet account for indexation for wage inflation.
|Level 1 support during||WA,SA,ACT,NT (West)||NSW/Vic/Qld/Tas, (East)||NEW base-price/hour|
|Weekday Daytime||+ 5.6 %||+ 7.6%||$50.57|
|Saturday||+ 5.6%||+ 6.7%||$69.56|
|Sunday||+ 7.9%||+ 8.4%||$90.45|
|Public Holiday||+ 11.3%||+ 11.4%||$113.24|
|Weekday Evening||+ 6.5%||+ 8.2%||$55.80|
|Active Overnight||+ 6.7%||+ 8.4%||$56.84|
Details about the increases of High Intensity support (Level 2 and Level 3) have also been published and can be accessed on the NDIS website. Prices of Group and Short term accommodation supports will increase (details are not yet published), Supported Independent Living (SIL) supports are not impacted.
Temporary Transformation Payments
Providers of Assistance with Daily Living and Assistance with Community Participation will be eligible for an additional Temporary Transformation Payment (TTP)which will replace theTemporary Support for Overheads (TPO).The new payment is set at 7.5% of the relevant level 1 support.The same dollar amount will be added to level 2 and 3 supports. The TTP will reduce by 1.5% each year thereafter however by that time we may find out about a different ‘Temporary Pain Relief Payment’.
We had hoped that things would get easier for providers, yet this payment is conditional to a set of obligations that will be outlined in the new 2019-20 NDIS Price Guide. Providers will be required to publish their service prices, list their contact on the Provider Finder and participate in an annual benchmarking survey. When submitting payments thought the portal, providers will have to acknowledge compliance to these requirements, which indicates that we can also expect changes to the portal.
Pricing of Therapy Services
Therapy services will undergo major price increases with separate price limits for different types of therapies:
- Psychology to $210/hr in ACT, NSW, QLD and Vic and $230/hr in NT, SA, TAS and WA.
- Physiotherapy to $190/hr in ACT, NSW, QLD and Vic and $220/hr in NT, SA, TAS and WA.
- Other therapies will likely increase to $190/hr with further indexation for wage inflation.
- To promote the usage of Therapy Assistants the pricing will increase as well.
The new price limits for therapists are also conditional to a range of obligations such as the publication of service prices.
Revised NDIS Policies
Most excitingly, the NDIA has announced a review of policies including cancellations, travel, the use of volunteers and charging for non-face-to face time. Details of the changes have not been published yet. We personally believe that the use of volunteers should be up to the provider, as well as the establishment of cancellation policies (as long as these are in line with current consumer laws). The attempt to unify business rules for every provider no matter its size, shape, location, customer base or type of service is a market control that may deter a vibrant market. We have recently published an article on the impact of the current NDIS Cancellation rules and we are still interested on hearing feedback from providers.
NEW look 2019-20 Price Guide
The NDIA has promised a new look 2019-20 NDIS Price Guide and we are looking forward to the ‘easy to navigate option’. The Price Guide advises providers to claim payment against a support line item that aligns closely to the service delivery. Yet, this can be challenging given that the current Price Guide does not list all services and must to be read in conjunction with the full list published in the Price Guide Support Catalogue (CSV file).
Unfortunately, the new NDIS Price Guide will not be published much in advance as prices and policies are still waiting finalisation. Knowing the Price Guide and its changes a few weeks ahead would greatly assist providers to adapt their documentation, policies, CRM and accounting systems, and to communicate changes to clients to be ready by 1 July.
Service Agreement reviews
‘Do we need to establish new Service Agreements’ is one of the most common questions we hear. Once a client and their provider have signed a Service Agreement, both parties need to adhere to the terms, conditions and prices as outlined in the agreement. Providers cannot increase service prices unless the agreement includes a clause that prices will increase subject to changes to the NDIS Price Guide. If the Service Agreement does allow for price adjustments, the changes still need to be communicated to the client, ideally well in advance. Good communication and transparency are essential in any business relationship. The funding in NDIS plans will increase as of July according to the Price Guide and participants will not be worse off in terms of the volumes of supports they can purchase.
The introduction of new funding rules will most certainly impact on Service Agreements and we are keen to hear some official advice from the NDIA (or lawyers with a consumer law background) on how providers could and should change over to new terms if Service Agreements are already in place based on previous rules.
More NDIA announcements
The NDIA has vowed to improve its provider relationship management and plans to seek industry input and feedback on policy impact. The NDIA has also promised a series of announcements prior to July to give providers an insight into the upcoming changes. We will continue to monitor for new information.
For feedback or consulting support please contact Dr Ellen Schuler.