Market monitoring and coordinating NDIS markets

NDIS markets are not yet working for all participants
Attempts to steward the market have been limited
The Panel’s vision: Governments, as market stewards, should be more active and flexible to help ensure NDIS markets work for everyone, everywhere
Recommendation 13: Strengthen market monitoring and responses to challenges in coordinating the NDIS market

NDIS markets are not yet working for all participants

The NDIS has transformed the way disability supports are delivered. Shifting from a government, block-funded model to a market-based model with individualised funding - where funding follows the participant and not the provider - has enabled participants to have more choice and control over the providers they work with and what supports they access.

With this shift came a significant increase in scale and diversity of demand for services and significant market development. Over 390,000 participants are now receiving disability supports for the first time.²⁰³ But this growth has not been sufficient to secure access to quality services for all participants, across all locations. Past reviews of the NDIS indicate a range of ongoing market challenges that reflect more than just transition issues (Figure 10).

Moving from block funded arrangements removed governments’ responsibility for coordinating access to support. The shift relied on participants, their families, providers and intermediaries having the capacity and capability to co-ordinate supports in an already complex environment, with limited (or at least unclear) protection for participants where markets fail.

For some NDIS supports, it has often been difficult for participants to find suitable service providers, and for providers to achieve economies of scale and to ensure continuity of supply.

There is a lack of options and choices, I’m struggling to find options near us that will help build independence towards future employment, build connect to community, friendships etc. Everything is far away.

- Carer and person with disability ²⁰⁴

For these supports, competition between multiple service providers has not been able to effectively ensure access to supports for all participants and in all locations.

Sometimes the number of providers or participants in the market is too small for competition between multiple service providers to work well or at all. We call this a ‘thin market’.

Thin markets have left some participants with limited, or no, access to supports or certain types of supports. As far back as 2017, the Productivity Commission found thin markets have been, and will continue to be, a persistent feature of the disability support sector. In the absence of government intervention there will be greater shortages, less competition, and ultimately poorer outcomes for participants.²⁰⁵

Figure 10: Past reviews of the NDIS indicate a range of ongoing market challenges that reflect more than just transition issues²⁰⁶

Attempts to steward the market have been limited

The National Disability Insurance Agency (NDIA) has tried different ways to improve access to supports. This includes testing in a small number of areas:

sharing information for participants and providers to find and connect with each other; and
ways to help participants find and buy supports as a group.

To date these efforts have been too narrow. The NDIA’s own evaluation of their thin market trials suggests providing better information alone is not sufficient to overcome challenges. Rather, governments must be more active and flexible to help ensure markets work for everyone.

Ensuring NDIS markets work for everyone is hindered by an incomplete picture of those markets. There is a lack of comprehensive, accurate and timely information about who is delivering supports and services and what supports are being delivered due to the current NDIS payment system. Coupled with fragmented feedback on service safety and quality, it is challenging for governments to understand what the markets look like and how they are working.

In addition to the challenges around access in remote and First Nations communities (discussed below), we’ve heard from participants about the continuing issues in accessing allied health supports in regional and rural parts of Australia. Over 33 per cent of participants - who have been in the scheme for at least one year - are not accessing any therapy supports in small and medium rural towns, despite having funding for these supports.²⁰⁷

I am in a regional area of 60,000. It is almost impossible to get services here for things such as OT's or speech pathologists - given these people are also required for approval of any spending - it is becoming quite unworkable.

- Extracted Participant Quote from Australian Association of Psychologists Inc²⁰⁸

Governments need to do more than just set the rules of engagement or act as a funding body. As market stewards, governments should also oversee these markets and intervene when necessary. These are social markets where governments need to monitor outcomes and carefully balance considerations of efficiency, effectiveness and equity.²⁰⁹

The Panel’s vision: Governments, as market stewards, should be more active and flexible to help ensure NDIS markets work for everyone, everywhere

NDIS markets, with guidance and active intervention from governments where necessary, should function better for all participants.

To achieve this, governments need to do more in their role as stewards of the NDIS market. This includes:

informed participant choice (see Recommendation 10 on information sharing)
continuous improvement in service quality and effectiveness – (see Recommendations 10, 11 and 12 on improving quality of services)
access to quality supports (see Recommendations 13, 14 and 15 on better access to supports)
appropriate regulation and safeguards for people with disability (see Recommendations 16 to 19 on regulation and safeguards for people with disability)

Agencies across the Australian Government have different functions and roles as market stewards. While the Department of Social Services stewards the market by setting market policy, other agencies – including the NDIA and National Disability Supports Commission – have a role in providing information and guidance to the market, operationalising policy, monitoring the market and taking action where the market is not functioning well or as intended (Figure 11).

Figure 11: Recommended NDIS market stewardship functions for Australian Government agencies

Stewards the market by Setting market policy

Department of Social Services

Oversees changes to primary legislation and the broad policy of the scheme

Coordinates actions across Australian Government and state and territory government agencies to steward the NDIS market

Works with government agencies to coordinate workforce planning and development across the care and support sector

Service delivery

Quality and safeguards

Pricing and payments

Scheme integrity

Stewards the market by providing information and guidance operationalising policy through systems and processes taking action or intervening where the market is not functioning well, or as intended

NDIA

Informs and educates about the scheme and market (including information to support participant decision making

Shares public data and intelligence to the market (including on opportunities and gaps in the market).

Enable connections between participants and providers (e.g. through matching tools).

Sets access and funding approaches for NDIS supports to ensure access to effective, quality supports.

Works across government to leverage buying power for better access to supports.

Builds partnerships with community to design and roll out service delivery approaches (including alternative commissioning).

Coordinates actions to ensure continuity of access to critical supports where markets fail.

National Disability Supports Quality and Safeguards Commission

Controls market entry and sets requirements such as provider registration and enrolment, worker screening (with states and territories), behaviour support and restrictive practices (with states and territories).

Informs and educates providers and workers (e.g. about their regulatory obligations) and participants (e.g. their rights and how to raise issues).

Identifies, investigates and responds to complaints, incidents and issues of noncompliance and takes corrective action (e.g. conditions, enforceable undertakings, bans, penalties).

Drives quality through capacity-building of providers, outreach, performance measurement (e.g. communities of practice, good practice guidance).

Works with other regulators and law enforcement to ensure safety and improve market quality.

Supports actions to ensure continuity of access to critical supports where markets fail.

IHACPA

advises on the maximum amounts providers can be paid for delivering supports

NDIA

Oversees enabling
payment infrastructure.

Administers payment system (including multiple payment channels), price cap and claiming ‘rules’.

NDIA and National Disability Supports Quality and Safeguards Commission

Shared responsibility

Refines risk management strategies on an ongoing basis.

Sets and refines risk treatments and controls to prevent, detect and respond to noncompliance, fraud and sharp practice (e.g. identity verification, payment controls).

Enforces compliance with scheme integrity ‘rules’.

Monitors the market (by gathering and sharing data and
intelligence) to inform market actions and interventions

Monitors market demand and supply using participant data, payment data and local intelligence (including navigators).

Proactively monitors and responds to risks and emerging changes in t market through provider reporting, complaints and other regulatory intelligence

Monitors and enforces pricing and payment ‘rules’.

Monitors market responses to price settings.

Assists providers with information to compare and benchmark their performance.

Monitors payments, transactions and other intelligence to detect non-compliance, fraud and sharp practice.

Strengthening access to quality supports for all participants will require more active market monitoring and using a range of responses flexibly to address identified market challenges.

Government, with the assistance of Navigators and improved visibility of all payments, should be able to better identify where participants are facing persistent challenges accessing supports.

Government should also be more active in providing tools that can help participants who have similar needs connect with each other and with providers to get the supports they collectively need. New matching tools should be available to participants and Navigators to connect and pool their funding to access supports that meet their needs as a group and on their terms. These tools should be scalable so that, when needed, they can be used widely by participants for a range of supports and across different locations.

Where competition between multiple service providers is limited or not possible, other tools should be used to ensure participants have access to supports where they live.

One such tool includes setting up a group of providers to deliver certain supports and in specified locations. We call this a ‘provider panel’.

Where market gaps persist, setting up provider panels would ensure participants have access to supports where they live. This should start with provider panels for allied health supports in small and medium rural towns. Provider panels should leverage good providers already operating in these areas and be regularly monitored and re-tested to ensure participants and the scheme benefit from improved access and investment in communities.

In remote communities and for First Nation communities across Australia, we need a different way to deliver supports that is place-based and community-driven and built on the strengths of these communities (see Recommendation 14). Supports need to be coordinated and purchased across the whole community.

There should be a clear, publicly available, policy on what actions would be taken by the NDIA, the new National Disability Supports Commission and state and territory governments when a provider fails or no provider - which is not owned or run by government - is willing or able to provide supports.

Recommendation 13: Strengthen market monitoring and responses to challenges in coordinating the NDIS market

* Legislative change required

Action 13.1: The Australian Government should undertake more active, evidence driven market monitoring to identify issues with access to quality supports early and take more timely and appropriate action. Market monitoring should draw on improved data collected from the transition to fully electronic payments (see Action 10.3) and information on service access issues reported by Navigators (see Recommendation 4). The National Disability Insurance Agency, in consultation with other government agencies, should use this information to take action to address market challenges and persistent and emerging supply gaps. This should include regularly releasing local market monitoring information to Navigators and providers (including, for instance, the NDIS Demand Map).
Action 13.2: The National Disability Insurance Agency should progressively roll-out provider panel arrangements for allied health supports in small and medium rural towns or where participants face persistent supply gaps. Provider panels should leverage good providers already operating in these areas and be retested at least every three years (or earlier where the panel is not meeting agreed service standards and outcomes). This would ensure panels are lowering the cost of service delivery through greater coordination of travel and sharing costs and resources among providers, and increasing certainty of demand for providers to encourage investment in communities. Provider panels should be progressively rolled-out in small- and medium-sized rural towns (Modified Monash Model categories 4 and 5), and used flexibly in other areas where supply gaps persist. Initial pilots should be evaluated to ensure settings are fit for purpose ahead of any wider roll-out of panels.
Action 13.3: The National Disability Insurance Agency should develop matching tools to support participants and Navigators to pool demand for supports. New matching tools should assist participants and Navigators to connect with other participants where there is a joint benefit from pooling their budgets to find and purchase supports. This may apply to group-based and other innovative supports. These tools should build on the lessons from the National Disability Insurance Agency’s use of Coordinated Funding Proposals to provide more scalable online matching tools. Participants and Navigators should be able to easily access these tools, including via the centralised online platform (see Action 10.1). These tools should allow participants and Navigators to collectively broadcast opportunities for existing and new providers to respond to their support needs and preferences.
Action 13.4: All Australian governments through the Disability Reform Ministerial Council should agree and publish a provider of last resort policy to ensure participants have continued access to supports where markets fail. Provider of last resort arrangements should be evidence-driven and underpinned by market monitoring (see Action 13.1), and reviewed every five years to ensure governments' market responses remain timely, effective and fit for-purpose. These arrangements should be part of a broader approach in how governments maintain access to critical supports for participants, including where services cannot be delivered as a result of natural disasters. The policy should address the needs of very complex clients and the need for the NDIA and National Disability Supports Commission to work together to ensure quality service continuity.

Market monitoring and coordinating NDIS markets

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NDIS markets are not yet working for all participants

Attempts to steward the market have been limited