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Transformation in the Land of Oz

The main reason I decided to give up August in Beautiful British Columbia and fly halfway around the world to Australia, where it was winter, was to discover how services to people with developmental disabilities were faring under the very rapid implementation of the change from block State funding to a National individualized-funding-based ‘insurance’ model of paying for disability services.  This would be similar to having all Canadian provincial governments cease their funding of services after Ottawa takes over and creates a disability fund by adding a 1.5% levy on all taxpayers.

The takeaway was that I am really happy to not be working in Australia.

The new National Disability Insurance Scheme (NDIS) can be traced to the realization by various levels of governments in Australia that spending for disability services was increasing at a rate of 8% per year.  In the meantime, services were generally poor quality.  Hence the scheme had been in a pilot phase for the previous two years and had been unrolled throughout the country starting on July 1, 2016.  The timing of our AAIDD (American Association for Intellectual and Developmental Disabilities) delegation was perfect.  The NDIS provides three tiers of supports:

Tier 1:  Targets all Australians through community awareness campaigns and by promoting inclusion.

Tier 2:  Provides information linkages and capacity building to about 800,000 people with disabilities and their families/carers.  All people with disabilities can consult with Local Area Coordinators to help them access no-cost community services.

Tier 3:  Provides individualized, funded packages targeting about 460,000 people who need “reasonable and necessary” intellectual/developmental disability supports.

The NDIS is based on the following assumptions although some are proving to be ‘wobbly’ as they would say Down Under:

  • Effective services are available for purchase
  • Information about services and their effectiveness is available
  • Consumers are capable of making choices, are informed about the benefits, drawbacks and costs of various choices
  • The NDIA knows about and bears the cost of sufficient, effective services
  • Generic service providers are prepared and capable of supporting people with disabilities
  • Families and individuals are capable of coordinating and managing their own services and their financial administration required by the NDIA
  • Everyone in Australia has access to and mastery of the internet.

So far, the challenges include:

  • Constant tension between providing care and reducing costs
  • Eligibility precludes funding for the over-65 group, people with borderline and mild intellectual disabilities
  • Building social capital for people who “are known well by no one”
  • Major computer glitches and payment problems
  • No one yet knows what “reasonable and necessary” means as applied to support services
  • There are far too few service providers to support so many people at lower levels of funding
  • No one knows if the model will be sustainable
  • The NDIS pre-supposes housing availability, but the situation in major Australian cities is bleak for those in need of affordable housing
  • Principles of funding promote cheap services offered by low-skilled attendants with no overhead included
  • Skilled supports are not an available choice option.

Rarely does one have the opportunity to hear what researchers and practitioners are saying about disability policy initiatives while reading about them in the newspaper.  On August 4, an article in The Australian headlined:  “Cash-strapped Providers Turn Away Patients”.  The story was about how a technology ‘bungle’ with the MySpace (NDIS) web portal led to a launch with so many bugs that providers, participants and families could not submit their billings for reimbursement.  Providers were thousands of dollars in debt.  In the meantime, nationally about 430,000 individualized plans needed to be developed and approved over the next three years, amounting to 392 plans per day.  Two weeks later, another article appeared in The Australian under the title:  “NDIS kids’ parents face debt-collectors because of a massive backlog of NDIS claims due to the inaccessibility of the web portal over 2 months.  One family talked about spending their savings for services but they were running out of money.  A mother with two children who have autism talked about her children regressing because their psychologist forced to withdraw services since he hadn’t been paid for 4 weeks.  Another psychologist said: “I know of professionals who have become so stressed over this they are reassessing their entire private practice therapy business and their health and emotional state has suffered.”   One Member of Parliament called the problems with the NDIS “an ongoing fiasco” and a “national disgrace”.

Although much of the NDIS is computer/internet-based, children and adults with disabilities must meet with an NDIS planner to determine their eligibility for a funding package and develop a plan with a goal.  Participants will have one goal but there is no policy regarding how many goals an individual may have funded.  Supports toward the goal must be “reasonable and necessary” although these important words have not been defined with respect to funding.  If individualized packages are funded, then there is an annual review where goals are achieved or abandoned.  Goals must be achieved within 12 months.  The role of the planner stops when the package is approved, so families have to find service providers online or by word-of-mouth, on their own.  Implementing plans is totally the family’s responsibility, including financial management.

Packages are higher for people who can move on, progress, develop and decrease their costs over time.  Once it’s determined the person can no longer progress, funding may decrease over time.  The goal of the NDIS is to decrease costs.  Once the NDIA approves a funding package, the participant must find a service-provider, either employing caregivers directly or through an agency.  So far, only 7% of participants have chosen self-direction.  If a provider is available, the participant will sign a service agreement stating the type of service to be provided and at what cost.

Families and service providers are skeptical and feel the NDIS may work for children and youth but can’t see it working for adults.  The NDIS was designed by economists and it was their way or the highway, so providers feel locked out of the process so far.  They are finding it hard to get information they need.

With less average funding per person than before, the NDIS is viewed as driving “efficiencies” or methods to reduce costs.  With so many more plans with one-to-one funding and people registering who had never before received services, there is an immediate need to triple the direct support workforce.  Corporations are a major force for change, as is market privatization, so non-profits will likely be unable to compete since they don’t have the cash flow of publicly traded companies.

There is an inherent tension between what families want – more hours of support, more service options and continuity of current personnel – and what NDIS Planners want is:  value for money, services that provide independence, a “flexible”, trained, coordinated workforce, and key partnerships with everyone.  Agencies are squeezed because there is no funding for staff training, there are few generic supports available in reality, funding for staff is low, and many participants will never become independent.

One of the primary assumptions of the NDIS is that people with intellectual disabilities all have loving families who are involved in their lives, who can help them make choices and build social capital.  The problem with this theory was illustrated by an Australian survey that indicated 80% of people with intellectual disabilities had not had a visit from friends or family in the past three months.  Fewer than 50% had a phone call from anyone in three months.

The biggest challenge for existing providers is wages.  Inclusion Melbourne pays $44-$48 per hour for one-to-one and other direct supports but the NDIS only pays $38-$42 per hour with no funding for training, human resources, or recruitment costs.  This may sound like a very high wage rate, but the minimum wage with benefits in Australia is $22 per hour.  A report from the Department of Social Services noted the risks to the NDIS rollout, including:  “provider readiness, provider collapse, critical market failure and mechanisms to monitor and respond to quality concerns.”

Since the introduction of the NDIS, there has been a radical increase in the number of guardianship applications but the families that need the most support commonly live in poverty and lack social supports, don’t understand the NDIS system and often face other life challenges.  These are also the least likely people to sign up for the NDIS because they lack information and computer access.

The Australian articles continued with concerns about a dramatic undercount of those eligible for the NDIS in the Northern Territories.  In 2006, KPMG collected data about almost 10,000 people with severe and profound disabilities, the criteria for NDIS coverage, but officials did not include anyone who was in jail, those with fetal alcohol syndrome, or those of indigenous backgrounds in their count of the NDIS.  The First People’s disability Network research director said there were “almost 60,000” aboriginal and Torres Strait Islanders with profound disabilities nationally.  The reason they were not picked up by KPMG was because most did not access services in the past.  Homeless people were also left uncounted, meaning the people who were most in need had not been included.  The NDIA had engaged KPMG to independently review its operations in 2014.  They reported the NDIA was “like a plane that took off before it was fully built.”

By September 2, 2016, The Australian reported that a PriceWaterhouseCoopers audit claims there is a “real risk” that the NDIS operating model will not be able to cope with over 400,000 new participants and the many more service providers who will be required to support them by 2019, even after their I.T. issues are fixed.  The NDIA lacked the “required commercial acumen in technology and complex transformation management”.  There was not one single system failure but problems resulted from a series of compounding events linked to deficiencies in the NDIA’s “governance, operations, change management and communication.”

From July 1 to August 31, 15,000 people had been deemed eligible for the NDIS, 4,000 were in the planning process, and 1,600 had approved plans – far from the target of 392 per day.  Only 970 care plans with packages had been approved in 2 months – far from the target of 20,226.

On September 16, 2016, ,a story ran in The Australian saying:  “The flagship $22 billion National Disability Insurance Scheme has ambushed the people it was designed to help by requiring participants to pay thousands of dollars a week up front for their own support without any financial backing”.  Workers from the NDIA had been calling participants about their support plans but were calling “about the wrong clients after names, numbers and support details were scrambled in the system, sparking privacy concerns amongst users.”  The NDIA also had a “catastrophic loss of e-mails, calendar appointments and all video-conferencing capability.”  They could not even print documents from their computers.

By the next day, the media reported that half of the people signing up for the NDIS were getting disability supports for the first time ever.  Many children did not previously qualify for support.  So far, autism accounted for 30% of all claims nationally.  A total of $2.4 billion had been committed to fund 35,600 claims, equalling an average cost per plan so far of $67,416, but the average participant cost for the overall plan is $27,500, so current packages are significantly over budget.  At the rate they are going, they will need $33 billion for people with intellectual/developmental disabilities alone, $55 billion for all people with disabilities.  Problems also continue with the very low supply of skilled support workers at any wage.

The goal of the NDIS is to move a poorly funded disability service system to one that is individually funded and based on “free market” principles by turning previous ‘clients’ into ‘participants’ who will be on their own to purchase the services they need.  With charities and non-profits largely out of the picture once the full scheme is implemented, millions of donated dollars that used to flow into the disability system will disappear.  Families will need to fundraise for themselves.

With enough money, people who have disabilities have no need to apply to the NDIS or for a Home and Community Based Waiver in the U.S. or to CLBC here at home.  They can live whatever life they or their family want to live.  For people with disabilities and their families who have little or no money, however, the amount of funding they receive to meet their needs is often the difference between inclusion and homelessness, food or rent, the community or prison.  In the end, the biggest barrier to inclusion, quality of life, independence and length of life for people with disabilities is poverty, although they are not poor by their own choosing.

By Alanna Hendren