Looking at the Australian National Disability Insurance Scheme (NDIS)

Looking at the Australian National Disability Insurance Scheme (NDIS)

Lesedauer: 7 Minuten

According to a report by the Australian Associated Press, there is bipartisan support for the National Disability Insurance Scheme (NDIS) despite ongoing criticism over rising costs. The cost of NDIS is anticipated to climb $8.8 billion over the next four years and approach $50 billion annually by 2025-26. Nevertheless, Australia’s prime minister says that the support “across the parliament” for the scheme to continue remains.

To look closer into NDIS and its implications, GLG’s Divya Guha hosted two teleconferences with Anthony Vella, the former Chief Operations Officer at Zenitas Healthcare, a disability services provider. This article is condensed and edited from those two events.

Could you please provide an overview of the National Disability Insurance Scheme and the disability care sector in Australia? What is the size and scope of the sector?

The NDIS rolled out in 2013, with the state and federal governments coming together in partnership to significantly increase support for people with disabilities transitioning from state-run schemes to a federal scheme, but also philosophically shifting and empowering people with disabilities to have more choice and control. Essentially, the scheme was funded by an increase in the Medicare levy and has currently about 534,000 participants, with the scheme growing approximately 20,000 participants per quarter. In Australia, more than 4 million people (around 18% of the population) identify as having a disability. However, not all of them are on the NDIS. That said, a little over 1 million people receive a disability pension or some type of career pension. So when you think about the numbers in terms of the wider cohort, or segments of the population with 4 million people described as having disability, over a million people are provided a disability pension or career pension, and then 534,000 participants are on the NDIS — a significant percentage of the population.

Of those people, 313,000 are receiving formal support for the first time. The committed funding of the NDIS for the last year was a significant $30 billion. When you look at the broader market in terms of the providers or companies that service those individuals, there are about 9,000 current active providers in the space. However, some work’s been done by Per Capita, a progressive consultancy think tank, which calculates the economic benefit of the NDIS as upward of $50 billion per year — close to $30 billion worth of direct spending and then the additional economic activity that then spurs on across the economy calculated at upward of $20 billion. So we’re talking about some significant funds overall in terms of the wider scheme — not only direct payments but also the economic activity that it stimulates.

What are the demographics of people with disabilities in Australia and the trends the industry has seen in terms of disability policy awareness?

Broadly, there are three types of disability represented on the scheme: psychosocial, which is mental health illnesses; physical, which is often acquired injury; and people born with a physical or intellectual disability.

The committed funding for the scheme is between $30 billion and $35 billion, albeit not all of it is spent each year; $10 billion of that is committed to intellectual disability, followed by over $7 billion for autism. Psychosocial disabilities — mental health issues and the like — receive approximately $4.5 billion dollars, then other items, like acquired brain injury, cerebral palsy, and the like, around a couple billion dollars each. So that’s an estimated breakdown of the different segments from a disability-type perspective.

In terms of other demographics such as age, children under seven make up a significant cohort within the scheme. There are more than 80,000 children under the age of seven of the 534,000 participants with the scheme, with the child cohort of under seven being the largest.

Also from a demographic perspective, over 9% of participants are Aboriginal or Torres Strait Islanders, so a substantial cohort of Aboriginal and Torres Strait Islanders are within the scheme.

Then more broadly, people with culturally and linguistically diverse backgrounds who may speak other languages or be from other countries represent 9% of the scheme. So that’s something for providers to consider also, just in terms of representation of their workforce. The bulk of participants are in metro or regional areas, with only 1.7% of participants being in remote or very remote communities.

It’s important to note that within these different segments of disability and classification are literally thousands of disabilities, with many participants having multiple disabilities. So, for example, a child with Down syndrome may also have autism and some other physical disabilities. There’s a crossover in terms of the different support and care they may need.

In terms of disability awareness, there’s more work that needs to be done, but key areas of focus are on inclusion in broader society. Research shows improved health and well-being outcomes when people with a disability are better included in the community, whether it be greater building accessibility or support with employment opportunities and traveling to and from work (or accommodation to work from home, for example, if that is something the person with a disability feels is best suited to them).

Could you please throw some light on how COVID impacted this industry?

COVID had and continues to have a significant impact on the industry through the complexity of managing care for individuals with disability, morbidities, or comorbidities who are susceptible to infection or serious illness. So providers have had to take extra precautions from a care and infection-control perspective. At omicron’s peak, in terms of the virus variants, up to 20% of the workforce was either isolating or infected at one point in time, which meant providers had to ration or triage care, which had a significant impact on not only revenue but also, obviously, what care could be provided to participants on the scheme. There was some government assistance with the scheme in Australia called Job Keeper. However, by the time omicron variants hit, that assistance was tapering off, so there was a bit of a financial impact for many of the providers who are now, over the last 6 to 12 months, recovering from that.

Many providers, as I mentioned, had trouble sourcing workforce, so they stopped providing lower-value care like domestic assistance, and they might not reenter that space. Then, when the Australian borders were closed, it cut off a supply of workers that many providers depended upon, causing a bit of havoc that remains a considerable challenge for the sector at the moment. On top of that, there’s just additional cost of care and compliance with sourcing PPE, rapid antigen tests, and the like. However, governments and health departments helped to support some of the additional costs with payments to providers to help smooth out the impact of COVID on the industry.

So how much does disability in the healthcare industry contribute to Australia’s economy?

The funding forecast and spending for the NDIS over the next 10 years is that it will edge up to at least 1.7% of the GDP. The only areas that will be larger are defense spending and the aged pension. Medicare, which is the universal health scheme across Australia, is predicted to grow from 1.2% to 1.4% of the GDP. This means that the NDIS will even outstrip the broad Medicare scheme over the next 10 years.

In terms of what the NDIS means for Australia from a broader economic benefit, there are some studies showing a multiplier effect of two to two and half times for every dollar spent. So while it is a fairly significant portion of government spending, these studies show there is a benefit to the broader economy. This comes across through the employment of workers via providers and direct spend on items such as consumables or accommodation for participants. It also frees up capacity in the economy where families now can provide their own support because they now have that support through the NDIS. With that support, they can themselves maybe reenter the workforce because they need to spend less time caring for family members or others with a disability.

About Anthony Vella

Anthony Vella was the Chief Operations Officer at Zenitas, a healthcare and disability services provider. Previously, Anthony held the position of Deputy Chief Executive Officer, Strategy Development and Chief Risk Officer, at National Disability Insurance Agency. Anthony held this role for 19 months. He is a senior executive with experience across healthcare and disability services.

This article is adapted from the GLG Teleconferences “Outlook for the Healthcare and Disability Services Sector in Australia” and “Healthcare and Disability Services Sector in Australia.” If you would like access to this event or would like to speak with experts like Anthony Vella or any of our approximately 1 million industry experts, contact us.




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