Disability insurance: best practice policy? ‘Perfect run’ for scheme

By Harley Dennett

Wednesday August 20, 2014

The National Disability Insurance Scheme is on track and has high satisfaction levels among participants, according to the latest figures published this week. The former Families and Community Services secretary describes the NDIS as representing Australia’s “best practice policy development” and a model for public servants seeking to advance good policy through governments.

The first year of trials has seen a very high level of uptake among participants — those with disabilities needing a support provider. As of the end of June, $285 million had been committed to participants with approved plans, who in turn represent 78% of the target number of participants agreed between the Commonwealth and state governments. The participants have been accessing the scheme via four trial sites across the country. A further three trial sites opened on July 1, extending the scheme to all states except Queensland (the northern state will be online by July 2016).

National Disability Insurance Agency chair Bruce Bonyhardy addressed the scheme’s national conference just prior to the results being released, saying that what had been achieved was impressive. However, there are still big challenges ahead in pricing and assisting service providers transition from a guaranteed client base to a competitive open market. He said the “reasonable cost model” had been agreed, if not yet the actual prices.

“We also need to find service delivery solutions for people living in regional and remote Australia where the workforce is patchy at best, and non-existent at worst,” Bonyhardy said. “Experience gained during the trial phase has demonstrated that the development of the market is a critical challenge. There is a high risk that demand generated by the NDIS will outstrip supply.”

An additional 90,000 full-time workers were needed, he said.

NDIA isn’t responsible for the housing of participants — an issue of contention during early negotiations with state governments — but the NDIS could be a “catalyst for new housing supply, which is affordable, accessible and as widely available as possible”, Bonyhardy said. The agency plans to release a housing discussion paper shortly.

Internally, the agency has moved from Canberra to Geelong and continues to attract qualified and motivated staff. Currently, 11% of employees identify as having a disability, and over 50% have a lived experience with disability.

Processing efficiency is improving, too. The time taken to determine a potential NDIS participant’s eligibility averaged 29.7 days in the first six months, and went down to 13.3 days in the second six months. After the initial teething phase, on average, a person with disability service needs will receive those services within 94 days of first application.

The NDIS is on budget, sustainable and within the projected cost of the full NDIS in 2019/20. The satisfaction rating among participants in the first four trials is over 90%. Bonyhardy expected hundreds of appeals to the Administrative Appeals Tribunal, but “there have been only a handful”. In all four heard so far, the AAT has upheld agency decisions.

“This is the best evidence that the scheme is being administered fairly and in accordance with the legislation,” he said.

A ‘perfect policy run’ for the NDIS

If the current NDIS picture looks good, it was probably helped by the “perfect run” policy developers had early on according to Jeff Harmer, who was secretary at the Department of Families, Housing, Community Services and Indigenous Affairs at the time. Harmer told the ANZSOG conference this month that the NDIS was one Australia’s great social policy innovations and the experience “represents best practice policy development.”

While Australia rated very highly in the OECD on income support for people with disabilities, the delivery of services was “very poor” and rated only 19 out of the 34 OECD countries. “It was not something to be proud of for a country like Australia,” Harmer said.

“When Bill Shorten became minister for disability, he immediately latched onto the ideas that had been developed by the Disability Investment Group as a possible solution to this big social problem.”

Harmer says there was a “particularly lucky” run of factors that ensured little resistance or interference in good process from government. Julia Gillard was early in her prime minstership; Shorten was ambitious and latched on to an idea in his relatively small portfolio. Once he moved to assistant treasurer, he had power to refer the idea to the Productivity Commission. Finally, Gillard found it advantageous to support as it was something new and different from the Kevin Rudd-era agenda.

“While a complex scheme, we were confident that there was no group or interest that was not considered.”

“As a former practitioner of over 30 years in the service and the last 13 as a CEO, I’ve seen many different strategies employed,” Harmer said. “Too often policy development is too quick, too urgent, without enough background work. The NDIS didn’t suffer from that problem, and I’m very confident that the program when fully implemented will be a great policy reform in this country.”

From the early work that identified the problem, instead reaching for a solution first, to the extensive and methodical work of the Productivity Commission determining how many people were impacted and the sensitivity analysis, Harmer says the NDIS development benefited from a great depth of understanding and background that most policies lack at the time of decision-making.

“When urgency is present, sometimes consulting with stakeholders is lacking, or not done at all … We spent over a year talking to people in all states and territories, with submissions, a website and Q&As, and talking with state officials and service providers,” he said.

“It’s hard to imagine how we could have done it very much better. While a complex scheme, we were confident that there was no group or interest that was not considered.”

John Walsh, a board member of DNIA and deputy chair of the National Health and Performance Authority, says there are still significant challenges emerging during the implementation, particularly for support organisations who have never had to operate in a marketplace before and don’t particularly understand business.

“We’re asking them to not get money in advance, and to be competitive,” Walsh told the ANZSOG conference. “We’re asking them to change systems and culture, and that’s a big shift.”

Meanwhile, attention is also on the National Disability Strategy, a whole-of-government framework with each portfolio promising to look for opportunities to improve the outcomes of people with disabilities.

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