Gemma Carey on two outstanding market actions the NDIA could take on NDIS pricing and sustainability

By Chris Woods

Tuesday February 11, 2020

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Yesterday, the Centre for Social Impact released the latest annual market survey of NDIS providers. Despite some improvements in pricing, the report found consistently high concerns over pricing, sustainability and cooperation.

The question now becomes these concerns — and even the report’s four recommendations for the NDIA, which cover resourcing, communication, advocacy and pricing structures — mean for market stewardship i.e. the idea that the NDIA and federal government should take a proactive, rather than traditionally regulatory, approach to market rules that limit “inequality and thin market”.

“My one piece of advice to bureaucrats, policymakers and NDIA folks, is that, we do need to pay attention to the sustainability of the sector and the concerns of the sector,” lead author Gemma Carey says. “I think that there’s been a bit of an attitude of ‘the market will take care of that,’ or ‘they’re just complaining because of a change in systems’.”

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“But we are quite a few years in now and people are reporting closures, mergers, financial losses,” she says. “So that is very real. If we don’t have providers, we don’t have a market.”

Carey and other CSI researchers have worked on the subject of market stewardships since the NDIS’ inception, and their next investigation will focus on what local actions are currently being done “in the absence of government stewardship”.

Without pre-empting the new report, Carey tells The Mandarin that, going off international literature on market stewardship (and previous CSI reports), there are at least two outstanding market actions the NDIA could take on pricing and sustainability:

  1. Ending the flat-rate pricing system and enable some pricing flexibility for providers in crucial markets or regions (see: also the December 2019 ‘Tune Review’ of the NDIS); and
  2. Offer real-time demand and supply data for providers (see also: the Joint-Standing Committee 2018 NDIS’ market readiness report).

These recommendations sit on the report’s existing four, which similarly feed into stewardship; lifting NDIA’s advocacy and communication, for example, would help relieve providers of their default, administrative burden of guiding participants through the scheme. Which, as Carey points out, was never their intended role.

The only area of provider concern Carey cannot, at present, offer a stewardship solution to is collaboration — although she does note that providers, in the report, for the first time reported a sense of hostility towards them from the NDIA.

“That came out quite a lot in the qualitative parts of the survey. I haven’t seen that before. So, that speaks to that there might be some cultural issues that needed to be addressed.”

On the topic of inter-provider collaboration explains that a lack of collaboration — and even a disintegration of pre-existing collaboration between providers — stymies innovation and progress, but is an unsurprising, if unfortunate, feature of introducing competition into a market.

Her advice is instead for the providers themselves, especially newer ones who, as yesterday’s report found, are less likely to reach out to competitors:

“We spend time, when we work with service providers, to encourage them not to view each other too much as competitors,” she says. “Or that just because you are competitors doesn’t mean that collaborating with each other is going to affect your bottom line. And it might actually improve it.”


READ MORE: What the latest NDIS provider survey says about pricing, sustainability and collaboration


 

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