NDIS reforms in 2025: What providers need to know

Key Highlights

• The NDIS has made big changes with the National Disability Insurance Scheme Amendment (Getting the NDIS Back on Track No.1) Bill.
• Starting on 3 October 2024, there is a new definition of NDIS supports. This will explain what NDIS funds can cover and what they cannot.  
• NDIS providers should learn the new lists for disability support and the rules for substitutions in certain situations and understand the implications for their business.  Some businesses will be disproportionately affected.
• Providers need to pay attention to updated guidelines about pricing, invoicing, and advertising to stay compliant with the rules.
• It’s also important for providers to keep up with quality initiatives and any updates about registration to remain compliant.
• This year we expect more changes to roll out, including pricing review outcomes, Foundational Supports Strategy, a redesign of early intervention pathways for children, and changes to the NDIS claiming systems to boost fraud detection. 

Introduction

• The Australian Government is still committed to helping the disability community through the National Disability Insurance Scheme (NDIS).
• Some new laws and updates to the NDIS Act, starting from 3 October 2024, focus on the main goal of the scheme: to empower people with disabilities.
• These updates are designed to make things clearer, fairer, and more stable for everyone involved in the NDIS.
• This can positively affect both the participants, and the providers related to this scheme.
• However, NDIS providers are challenged keeping up with the ongoing changes and managing the impacts on their business – revenue, operations and how they can continue supporting participants while remaining compliant. 

Key Legislative Reforms from Oct 2024 and Their Impact on NDIS Providers

• The NDIS system is evolving with the new National Disability Insurance Scheme Amendment (Getting the NDIS Back on Track No.1) Bill.
• This bill prioritizes participant needs, prompting NDIS providers to enhance their services to align with these changes.
• The reforms bring clarity to funding, support definitions, and provider accountability, crucial for sustaining robust disability support.
• NDIS providers will continue to experience changes to the operating environment in 2025.  Some may lose revenue from participants no longer being able to purchase or limits to the purchase of some supports, or non-compliant invoices being rejected, and all providers will need to comply with the fair pricing rules and changing compliance and regulatory requirements.  

Understanding the New Disability Support Lists

• A significant change for NDIS providers is that the scheme now defines disability supports based on a list of approved supports, a list of services and supports that are clearly not disability supports, and a limited process to apply for replacement supports.
• The aim is to offer clear guidance for assisting people with disabilities and clarify what the NDIS is responsible for funding.
• NDIS providers must familiarize themselves with these updated support lists to align their services with the NDIS framework.
• The NDIS has been issuing FAQ clarifications on specific supports such as equine therapy, art and music therapy, dieticians and parenting programs.  The NDIS Operational Guidelines under being updated, and we note some changes to definitions around health supports.
• Understanding what qualifies as NDIS support is crucial for accurate service delivery, invoicing, and compliance.

Navigating Fair Pricing and Compliance Challenges

• The 2025 updates include a key change to the Code of Conduct (which applies to all registered and unregistered providers) with a clause mandating fair pricing for NDIS supports and services.
• Understanding pricing and rules can be challenging.
• Providers must use transparent pricing to show the true cost of services, ensuring NDIS participants receive value for their money – in simple terms, a provider cannot charge the NDIS more for a support or service, unless there is a reasonable circumstance such as incurring higher costs.
• Providers must stay updated on new guidelines, especially funding component amounts in a participant's new plan, which allocate budgets for specific support categories.  For example, STA has a limit of the number of hours of STA that can be billed over one year.  Any billing or claims over those hours will be refused by the NDIA.  
• Providers should openly discuss support costs with participants, check with plan mangers and support coordinators at the time of making a service agreement to adhere to pricing and funding rules. Providers will need to maintain detailed records to adapt effectively.
• Following the fair pricing rules builds trust with participants and strengthens the NDIS in the long run.

Invoicing Requirements for NDIS Providers: What You Need to Know

• Clear and accurate invoicing is vital for NDIS providers to receive payments promptly and maintain transparency with participants. Starting in 2025, adherence to specific invoicing requirements ensures proper allocation and accountability of NDIS funding.
• Providers must now include total budget amounts, funding component details, and funding periods in their invoices. This breakdown offers transparency to both participants and the NDIA regarding fund allocation across support categories.
• Plan Managers can only process compliant invoices and must refuse to claim and pay invoices that are non-compliant.
• Time periods are also catching providers and participants.  While the legislation allows two years to make a claim, the NDIS are imposing strict 90 day claiming periods in certain circumstances.  Also, upon making the claim, in some cases it can take up to ten days to process the claim and be paid.  
• Providers need to manage invoicing and claim processing promptly, and carefully manage debtors to minimise the administration load of chasing long term outstanding claims. 

For more information on the specific requirements for NDIS invoicing read our in-depth article here 

The Impact of Advertising Regulations on NDIS Service Providers

• The ACCC is focusing on problematic advertising practices which target NDIS participants.
• The focus of this effort is advertising by providers (both registered and unregistered) which falsely represents the goods or services of a NDIS provider as either being affiliated, approved or completely covered by the NDIS when they are not.  This includes the use of the term “NDIS” in business names and service naming.
• The use of sharp pricing is also included, as discounts or incentives to purchase NDIS supports have always been prohibited in the NDIS Code of Conduct.
• Providers must adhere to clear, truthful marketing materials and comply with updated guidelines.
• Transparency, honesty, and respect should guide all advertising efforts, with close attention required for reviews, comparisons, and claims of superiority to meet the new standards.
• Providers need to review their marketing and published materials to ensure that they are not breaching the rules.  Regular communication with key stakeholders and legal counsel is advised to navigate these evolving regulations effectively.

Quality Initiatives and Provider Registration Updates

• Maintaining high service standards is crucial for NDIS providers, and there are a number of initiatives from the Australian Government, the NDIA and the NDIS Quality and Safeguards Commission underway.
• There has been a marked increase in regulatory action and penalties, underscored by the legislated increase in maximum penalties to amounts in excess of $15 million.
• NDIS provider registration is essential for participating in this scheme. Providers must demonstrate compliance with quality and safety standards during registration and renewals.  Providers have indicated that the registration audits are not simple exercises.  Recent activity has focused on “boilerplate” policies and procedures – providers are required to demonstrate that policies and procedures are tailored to the provider’s specific circumstances and participants and provide evidence of being implemented and practiced.
• Providers will need to stay informed, undergo relevant training, and foster a culture of improvements. Demonstrating a commitment to quality ensures compliance, fosters trust, and instils confidence in NDIS participants.
• In 2025 we would expect to see further information and advice issued on:
  • The Australian Government announced that all support coordination services, supported independent living (SIL) services and platform providers would need to become registered providers.  Timelines are yet to be shared with the sector.
  • Provider registration measures to ensure improved risk management, such as requirements to ensure provider boards will have access to expert advice on quality assurance.
  • Any conflict of interest measures that may be imposed.  This may affect support coordination and SIL/ SDA housing providers.

 FOR MORE INFORMATION

To learn more about RSM's specialist services for NDIS providers, contact Andrew Sykes or Kirsty McGovern-Hooley.