Disability NFPs Facing ‘Oblivion’ Under NDIS Changes
7 May 2015 at 12:05 pm
Niche community service providers are facing “oblivion” as the window to adapt to NDIS changes closes, a leading Brisbane-based Not for Profit legal specialist has warned.
Director of Paxton-Hall Lawyers, Paul Paxton-Hall, said the NDIS required providers to turn their business models a full 180 degrees – from a “funding” model to a more highly competitive “marketing” model, where care recipients had the power to hire and fire their providers.
“Realistically, providers who haven’t changed already are behind the eight ball. They need to scale up, merge or find another way to survive in the new reality of the NDIS,” Paxton-Hall said.
“The NDIS will allow people who consume services to decide who will provide them and market forces will have an impact on what people will pay.
“And adding to the urgency is the fact Queensland Premier Annastacia Palaszczuk is one step closer to securing a trial site in Queensland before the official launch date of 1 July next year.
“So, it could well be less than six months before the industry sees the first major changes sweep through.”
Paxton-Hall said the United Kingdom example should serve as a warning to providers in Queensland and across Australia.
“Before their new system was implemented, 95 per cent of the services providers were Not for Profit whereas now it’s completely flipped and 95 per cent of providers are for-profit businesses,” he said.
“With the power in the hands of the consumers, some of the large providers who already offer a wide breadth of services will be in a better position to attract business.”
National Disability Services – the Australian peak body for non-government disability services – currently has a membership base that includes 916 organisations who are Not for Profit providers in the disability field.
“But with only a handful of organisations dominating the current marketplace, niche care providers may find it hard to attract business,” Paxton-Hall said.
“This is a complete change from the current and long-standing model which sees providers tender for funds from the Government and then distribute those funds through services provided in the community.
“From 1 July 2016, those receiving the services will receive the funding personally and choose how they ‘spend’ it.
“The world as providers now know it will no longer exist and the window to prepare for the onslaught of the change is rapidly closing.
“The shift means smaller providers will need to seriously review their own operations and potentially explore other business options to survive.
“As soon as the sector moves to a consumer-directed model anyone satisfying NDIS requirements is able to come into the marketplace to offer their services.”
As well as the requirement for visibility in the market, Paxton-Hall said providers would need to implement significant new processes, including payment processing.
“The thing is to be proactive and start thinking about life after NDIS now or risk being left behind,” he said.