NDIS Reform Fallout: Small Allied Health Clinics and Your Access

NDIS Reforms Raise Concerns for Small Disability Support Businesses and Local Services

Thousands of small allied health businesses are facing significant uncertainty as major changes to the National Disability Insurance Scheme (NDIS) take hold, alongside the introduction of new service models like “Thriving Kids.” Leading industry bodies are urging the government to step in, provide crucial support, and ensure a smoother transition for these vital providers.

The Council of Small Business Organisations Australia (COSBOA) and Allied Health Professions Australia (AHPA) highlight that without a clear plan, many local businesses that have invested years in serving NDIS participants could struggle to adapt.

A Changing Landscape for Disability Support

Businesses Built on the NDIS Model

Many occupational therapists, speech pathologists, physiotherapists, psychologists, and other allied health professionals established private practices as the NDIS grew. They invested their time and resources, building businesses and employing staff specifically to meet the demand created by the scheme. These businesses are often deeply embedded in their local communities.

Now, the NDIS is undergoing substantial changes. The scheme is being refocused on Australians with permanent and significant disabilities, meaning some participants may transition out of the NDIS and into new ‘foundational supports’ designed for broader community access.

What is ‘Thriving Kids’?

One of these new foundational support models is “Thriving Kids,” which aims to provide early intervention services for children outside the full NDIS scheme. While the goal is to offer timely and accessible support, this shift means a change in how services are funded and delivered. For businesses that have primarily relied on NDIS funding for paediatric services, adapting to these new models presents a significant challenge.

Skye Cappuccio, CEO of COSBOA, emphasised the human element behind these businesses. “These aren’t faceless providers,” she stated. “They are small business owners who have spent years building practices, employing people, and investing in their communities. Many built their businesses in response to the system created by governments. Now that system is changing substantially and some are facing another major restructure through no failure of their own.”

Rising Financial Pressure on Providers

AHPA CEO Bronwyn Morris-Donovan shares COSBOA’s concerns about how the sector will manage this transition. She affirmed, “We absolutely support the goal of a sustainable disability support system where Australians who need allied health support can access the right services when they need them.” However, she stressed the need for a clear government plan, including practical measures to help the sector remain resilient.

Evidence of the mounting pressure on the sector is already emerging. Recent data from the Australian Securities and Investments Commission (ASIC) shows a concerning trend even before the reforms fully take effect. The number of companies in the healthcare and social assistance sector entering external administration – a sign of severe financial distress or impending closure – rose dramatically from 160 in 2022-23 to 481 in 2024-25. This represents a 200 per cent increase, the largest of any industry division.

Specifically for allied health providers, first-time insolvency appointments jumped from 17 to 68 over the same period, a staggering 300 per cent rise. Other social assistance services saw an even sharper increase, from 18 to 126, up 600 per cent.

Urgent Calls for Government Support

What Industry Bodies Are Asking For

COSBOA and AHPA are calling on the government to provide targeted support to help businesses navigate these changes. Their key requests include:

1. Clear Information and Guidance: Providers need timely and understandable information about the reforms and how they will impact service delivery and funding.
2. Business Resilience Tools: Support to help businesses adapt their models, including access to advice on restructuring or diversifying services.
3. Assistance for Restructuring: Practical help for businesses that need to significantly change their operations due to the reforms. Ms Cappuccio highlighted that existing government programs for businesses facing disruption should be actively connected to allied health providers rather than leaving them to figure it out alone.

The organisations also want government-led research to identify which businesses and communities are most at risk from the changes. They are advocating for small and private providers to be actively involved in the development of new “Thriving Kids” commissioning models – which refers to how the government plans to fund and arrange services under the new scheme.

Ms Morris-Donovan explained that this research is crucial. “This research would give Government the information it needs to realistically assess where displaced allied health professionals could work. We cannot just assume businesses and clinicians can simply move straight into other sectors such as aged care,” she said.

Regional Communities at Greater Risk

The disruptive impacts of the NDIS reforms are expected to be felt most acutely outside major cities. In regional and remote communities, a single allied health practice often provides essential services across multiple areas, including disability support, paediatric care, and aged care. If these practices face closure or significant reduction in services, replacing that lost capacity can be incredibly difficult, leaving communities without crucial support.

It’s also worth noting that around 90 per cent of occupational therapists are women, as are the majority of speech pathologists and psychologists involved in early childhood intervention. The disruption could disproportionately affect women-led small businesses.

Ms Cappuccio underscored that the ultimate outcome for these businesses depends on decisions the government still needs to make. “Governments still have choices about how this transition is managed,” she said. “Private providers need a genuine place in the development of new service models, with practical support available for businesses that need to restructure. Small businesses shouldn’t become collateral damage from reform because nobody stopped to consider what would happen to them.”

What This Means for You

The NDIS reforms aim to create a more sustainable and equitable disability support system for the future. However, the transition period presents challenges for everyone involved.

For NDIS Participants, Families, and Carers:

• Stay Informed: Keep an eye on announcements from the NDIS and government regarding new foundational supports and “Thriving Kids” programs.
• Communicate with Providers: If you are concerned about your current allied health services, speak directly with your providers, plan manager, or support coordinator to understand how these changes might affect your support plan.
• Advocate: Your experiences and feedback are important. Consider engaging with disability advocacy groups to share your perspective on how the reforms are impacting you.

For Disability Service Providers and Businesses:

• Seek Information: Actively look for official guidance from the NDIS, Department of Social Services, and your industry bodies (like AHPA and COSBOA).
• Plan Ahead: Begin assessing how new service models and funding streams might impact your business operations and consider strategies for adaptation or diversification.
• Engage with Industry: Connect with professional associations and small business organisations for support, resources, and to ensure your voice is heard in policy discussions.

The coming months will be crucial as governments solidify plans for the NDIS and new foundational supports. Clear communication and proactive support will be essential to ensure that the vital services provided by small allied health businesses can continue to thrive and meet the needs of Australians with disability.