The latest NDIS Quarterly Report features an alarming truth. NDIS participants are missing out on almost one third of NDIS funded supports that they're entitled to. In this article our CEO, Sean, suggests what needs to change to make the NDIS more successful for everyone.
Read the full discussion on LinkedIn.
In its 400+ pages, the latest NDIS Quarterly Report is beginning to show maturing trends as the NDIS heads towards its full roll-out. While many statistics in the report are open to interpretation when it comes to the Scheme’s overall impact on participants, one number stands out as unequivocally poor: plan utilisation rates. The alarming figures demonstrate that fundamental changes need to be made to ensure the NDIS is a success for everyone.
Plan utilisation refers to how much of each participant’s budget is spent on supports each year. In many ways, it is a direct measure of how effectively participants are bringing their plans to life and achieving their NDIS goals.
The national average plan utilisation rate for the most recent quarter was just 68%. This means that NDIS participants are missing out on almost one third of the NDIS funded supports they’re entitled to. Even more troubling is the fact that that percentage drops to 52% utilisation of Capacity Building supports, which are arguably at the very heart of what the NDIS is looking to achieve – to build the capacity that participant’s need to achieve their stated goals and to live the life they want.
Low plan utilisation rates represent more than just unspent money; they’re missed opportunities for people to build new skills, create new relationships, access innovative services, interact with their community, or receive much-needed support in their day to day lives.
What drives underutilisation
While the NDIS Quarterly Report doesn’t state why utilisation rates are low, it does provide some clues.
Firstly, the difference between rates in major cities and remote areas is not as stark as you might think (68% and 63% respectively), showing it’s not simply a matter of geography and availability of service providers behind the number. My conclusion here is that the issue of ‘thin markets’ is almost as significant an issue in our major population centres as in our smaller regional locations.
Secondly, utilisation rates increase as participants gain experience - from 45% for participants on their first plan to 75% for those on their fifth - suggesting that education, confidence, and seeking and finding good advice all make a big difference. Another possibility is that the increase reflects the fact that people’s NDIS budgets are being reduced to align with how much has been spent in previous plans. Despite many real examples of this being brought to our attention at Plan Partners, the NDIA remain coy on the issue.
It’s also important to note that even amongst people on their fifth plan or more, a quarter of potential supports are still not being utilised.
How to improve utilisation rates
Firstly, I’d suggest changing the structure of NDIS Plans to allow for Capacity Building funds to be fully flexible within the Capacity Building categories, in the same way that Core Supports are fully flexible. In this way, more participants will be inclined to use these highly underutilised funds. True choice and control and increased plan utilisation is not encouraged by arbitrary boundaries between Support Categories that are designed to achieve almost identical outcomes for participants.
Secondly, my view is that If the NDIA thinks about plan utilisation issues more broadly, they must be more willing to enlist the support of intermediaries. I’ve seen countless times the positive impact that Plan Management and Support Coordination services have on participants’ NDIS experiences. These intermediary services help participants to extract maximum value out of their plans and build their capacity to navigate the Scheme and to find the right supports.
Crucially, these intermediaries should not face conflicts of interest by providing direct support as well, ensuring they are genuinely motivated to provide the best advice – and hence outcomes – to their customers.
With higher utilisation rates tied to better education and familiarity with the NDIS, intermediaries are perfectly placed to boost those figures and deliver a more sustainable and successful Scheme. But progress is unlikely when “NDIA managed” plans remain the default position of the NDIA, and little is being done to dispel the view that Plan Managers simply pay invoices. This is overlooking the crucial role they play in giving participants the tools to manage their budgets effectively and to prevent underspending as well as overspending.
A growing number of people within the NDIA as well as Local Area Coordinators now realise that the success of the Scheme is intrinsically tied to the involvement of skilled and passionate intermediaries. However, the NDIS Quarterly Report shows that many participants don’t receive any intermediary support with organising their NDIS finances – they have to rely on the NDIA or try to manage themselves. When it comes to rates of Support Coordination, 60% of participants face the task of finding the supports they need without funded assistance - a daunting prospect for many.
While a 100% utilisation rate may be an impossible goal, we should strive to at least get near it. A 68% rate is simply unacceptable and is diametrically opposed to the underlying outcomes that the Scheme was based on. The road to full plan utilisation will no doubt be long and complex, but by giving participants more flexibility to use their capacity building funds and by providing greater access to intermediary supports, the NDIS journey can be more fruitful for everyone.
As an issue that’s no doubt close to all your hearts, I’d like to hear your thoughts on how you think the sector can improve plan utilisation rates.