How does NDIS funding work?

May 29, 2020

How does NDIS funding work?

The National Disability Insurance Scheme (NDIS) is Australia’s first nationwide scheme that provides funding to eligible Australians aged under 65 who have a permanent and significant disability.

The National Disability Insurance Agency (NDIA) is the Commonwealth government agency responsible for implementing and administering the NDIS.

More than 270,000 Australians have already accessed the NDIS with numbers expected to rise as the rollout of the Scheme continues in Western Australia and more people with disability become eligible for NDIS.

With such a large number of people accessing funding for disability supports, it makes you wonder, is the NDIS government funded and how does NDIS funding work?

In this blog, we cover how NDIS funding works and where the funding comes from.

How the NDIS is funded

The NDIS is jointly funded by the Commonwealth and participating states and territories using a pooled approach. The Commonwealth provides more than half of the funding.

Funding for the NDIS is also taken from the Medicare levy, which increased from 1.5 per cent to 2 per cent in July 2014. This revenue raised is directed to the DisabilityCare Australia Fund which then reimburses governments for NDIS expenditure.

In 2019, it was predicted that $11.2 billion was spent on the NDIS with $6.8 billion of that coming from existing disability funding and the Medicare levy.

How NDIS funding works

The Scheme works by providing individuals with NDIS funding to access approved disability support services that have been identified as reasonable and necessary within their plan.

There are three categories of funding within the NDIS that participants can receive money for:

• The core supports budget, which includes consumables (everyday items such as continence aids), low-cost equipment to improve your mobility (such as a walking stick), help with daily activities (such as household cleaning and yard maintenance), social and community participation (such as hearing aids) and transport;
• The capacity building budget, which includes helping participants achieve their goals in areas such as employment (help to find and keep a job), health (exercise and diet advice), education (assessment and training to move from school to further education) relationships (advice to develop positive behaviours and interact with others) and living arrangements (help with finding a place to live); and
• The capital support budget, which is used to fund assistive technologies such as wheelchairs or vehicle modifications, and modifications to your home, such as the installation of a handrail in the bathroom or ramp into the home.

Depending on how you choose to manage your NDIS funding, accessing these funds to pay providers will vary. If you choose to self-manage your plan funds, you have two NDIS funding options to pay for your supports:

1. Make a Payment Request and then pay your provider:

Once you receive an account, invoice or timesheet from your provider you then make a Payment Request using the online myplace portal.

Money from your NDIS plan budget will be paid into your nominated bank account within 24 to 48 hours. You can then pay your provider from your bank account.

2. Pay your provider and then make a Payment Request:

After you receive your support you can pay your provider using your own money, obtain a receipt and submit a Payment Request to have those funds paid back into your nominated bank account from your NDIS plan budget. You will be reimbursed within 24 to 48 hours.

The simple plan management option

Another option for managing your funds is to request for plan management to be included in your plan. Here is a breakdown of how plan management can benefit you:

• No out-of-pocket costs – plan management comes at no additional cost to you. To receive additional funding your plan management in your NDIS plan, simply request for it to be included at your planning meeting or next plan review.
• No more record-keeping – your Plan Manager will take care of paying all provider bills on your behalf and keep the mandatory records required. This is a time-consuming process so haven’t it taken care of for you is a great benefit.
• Budget management – when working with a Plan Manager, they will keep track of your plan funds and keep you informed about your spending including when any budgets may be running low.
• Tailored recommendations – if your plan is coming up to its next review, your Plan Manager can help to appropriate your remaining funds so that you are making the most out of your budget every time. They can also answer any questions you have about your plan funds and provide recommendations.
• Negotiate with service providers – another major benefit of plan management is that they are experienced in working with service providers and know how to find the best providers to suit you and your budget. They can help maximise your plan by negotiating a better rate with your preferred providers.

Working with Disability Plan Services as your NDIS Plan Management provider will allow you to maintain control of your support services without the difficult administration and record keeping.

If you are new to the NDIS or are unfamiliar with what services and supports are available to you in your community, Disability Plan Services helps to facilitate the best supports for you and provide you with advice that suits your individual needs and goals.

Our team are experienced NDIS Plan Managers and know how to make the most of your funding.