What’s really going on with business’ closing?

Underlying pressures and business evolution struggles under the NDIS.

Observing over the past 12 months as the NDIS is fully rolled out across the country, we witness some of the great’s coming unstuck..

Care providers, service providers, housing providers, not for profit and private enterprise all vowing for their place in a market that has drastically changed over the past 5 years.

But why are businesses closing?

What is it that’s going so wrong that end’s no longer meet?

Is it the change in funding model that’s caught business’ off guard and missing the mark?

Or is it the funding changes that have made it sustainable only on a shoestring budget to provide the care that end participants actually require? No buffer for actually running the business to support it all?

With 850 million recently injected into the NDIS budget, care providers say that the new funding will allow therapists to receive a minimum increase of almost $11 per hour, while the base limit for attendant care and community participation will be increased by up to 15.4 per cent.

Minister for Families and Social Services Paul Fletcher said the changes “form part of the National Disability Insurance Agency’s annual price review to update prices that reflect market trends, costs in wages and other influences”.

Acting CEO of National Disability Services, David Moody, said the price increase would make a real difference.

“Until now disability service providers have borne the brunt of inadequate NDIS prices, with 28 per cent operating at a loss and 1 in 10 discussing closure altogether,” he said.

These are alarming figures, and one’s that really affect the end user. But our concern is that businesses aren’t evolving to address the major shift in business model that the NDIS allows.

Innovative, evolutionary companies that are challenging how they did business and getting creative on ways to deliver their care within the new parameters (and not with the old Block Funding model), are growing and paving the way for more agile and efficient service providers in the industry.

Yes sure, the hourly rates needed a hike, and of course there’s plenty that could be argued for who’s at fault. But perhaps the big ol’ businesses just need to change with the times? Inject a little creativity and innovation into their management style and aim to succeed in the new jungle. Not get eaten up by it.

The Specialist Disability Housing market is a great example of this.

You have a mix of investors, service providers, finance companies & participants all trying to work together to achieve a goal: Increase independence, decrease required supports via growth of capabilities in homes that support the person’s independence.

Now bringing in creative minds from other industries has proven to be a great place for creatively solving a problem. We have all sorts of models coming through in new housing models, that address all the needs of the person, plus address the best way to achieve that via the available funding (SDA funding).

1. Villa complexes with concierge care to each villa, allowing independence but cost efficiencies
2. Units with shared care across each floor
3. Duplex’s with combination of design/housing type & one care provider over both homes
4. Owner Occupier models for tenants to own their own home & earn an income from their funding

All of these models have evolved and address the needs & wants of the participants first and foremost – plus bring in financial models that make them viable for businesses to operate within their means.

Although it’s a major upset to see some companies close their doors after years of positive impact and thousands of hours helping others, we hope to see the flip side where new, more flexible business models will thrive, whilst really listening to what participants want..

Isn’t that what it’s all about? And we hope that those successes outweigh the losses in the industry.

SOURCES: SBS NEWS & DISABILITY SUPPORT GUIDE