National Disability Insurance Scheme Australia

What is the National Disability Insurance Scheme (NDIS)?

National Disability Insurance Scheme (NDIS) is an Australian Government initiative to provide financial support to citizens and permanent residents of Australia who have a disability that requires long-term care and assistance, and who cannot afford private disability insurance.

This initiative was put forward by the former Prime Minister, Julia Gillard, in the Productivity Commission's report on Disability Care and Support, on August 10th, 2011. In this report, The Australian Government stated that it is committed to improve the quality of life for people with disability and their carers, increase their economic and social participation with improved care and support services. All Governments agreed with this recommendation to establish NDIS and a National Disability Strategy is formed.

The Government released the draft of NDIS Bill into Parliament in November 2012, in which a framework for nationwide scheme had been created, including criteria for eligibility, age requirements and what constitutes reasonable and necessary care and support. The Bills had been created by taking into consideration the feedback provided by people with disability, their families, carers and disability organisations across Australia. The Parliament had voted on the NDIS Bill and had since prepared for its trial launch in July 2013, with a full launch planned for 2018/19.

Source: NDIS, 2013, Australian Government Productivity Commission, 2012 and Australian Parliamentary House, 2013

Who is affected by disabilities in Australia?

Over 4 million Australians are affected

There are about 4.5 million people in Australia that have a disability of some kind, which constitutes around one fifth of the Australian population. 760,000 people are under the age 65 have a significant disability, in which they always or sometimes require assistance in completing a core activity or task. In 2012, there were 7,600 people under the age of 65, who need full-time support, that are living in aged care homes because there were simply no other choice.

Don't forget disability carers

Around 500,000 Australians are primary carers of people with a disability (equivalent to the population of Tasmania), of which depression has a 50% probability of occurring compared to the general population (6% ).probability. Furthermore, there are at least 2.4 million people (10% of the nation) that are non-primary carers in Australia.

Source: The Monthly, 2010, and Bigpond Money, 2012

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A background of disability support in Australia

In Australia, the states administer disability support and due to minimal tax base to pay for it, coverage for care and support of people with a disability is bleak at best, with a nationwide disparity. Nearly one-third of Australian households who are living below the poverty line have a member living with a disability. The means to access a care package is complicated, if not, it is extremely scarce. It is almost like winning the lottery, only that people that are disadvantaged with future improvement of their quality of life looking grim.

Getting a care package approved may depend on something as frivolous as the side of street that you live on. If you have an accident in an area where the border between NSW and Queensland exists, you may want to hop into NSW. Why? In NSW, you can get access to full support of motor vehicle injury, which contributed to your disability, through the state's no-fault Lifetime Care and Support Scheme, and Queensland does not have a system as such in place. On top of that, about 85% of applications with a request for high-level support care are rejected.

It often takes up to two years for a child to be provided with a wheelchair. Children under the age of 5 are not allowed access to a motorised wheelchair, even if their mobility, ability to learn and play depend on it.

A care package means all the difference in survival, especially for someone who has a disability. According to Bill Shorten, the former parliamentary secretary for disability, people with a disability are more likely to be unemployed, require income support, and renting or living in public housing. They are also unlikely to complete secondary education and there has been a worrying number of people with an intellectual disability ending up in jail.

Source: The Monthly, 2010, and Bigpond Money, 2012

How does National Disability Insurance Scheme Bill work in Australia?

Who is it for?

NDIS is considered to have three main functions in which it serves three types of customer populations:

  • Tier 1: EveryoneThe NDIS is provided for every Australian, as it offers a form of insurance in the event in which they have acquired a significant disability and require support in meeting the costs for care and treatment. The purpose of NDIS for Australian population (of 22.5 million) will be to increase social participation, minimise the effect of disability and work as a protective insurance.
  • Tier 2: People with, or affected by, disabilityThe NDIS will be accessible by anyone who has a disability (four million of the population) or affected by it (800,000 of primary carers or families), to either obtain information or referrals for service with other service providers that NDIS is not directly responsible for, such as mainstream services and community support groups.
  • Tier 3: People with disability for whom-NDIS funded and require tailored and individualised supportsNDIS will target tailored and individualised supports towards people of all ages (from infants to pensioners) with ongoing support needs and requirements that would not be met at the level that is required without taxpayer-funded scheme and people with such needs include:
    • 3a: Individuals with intellectual, physical, sensory or psychiatric disabilities and have significantly reduced level of function (roughly around 330,000 Australians).
    • 3b: Group of people which require early intervention (80,000 people).
    • 3c: Other individuals who have been receiving maximum support (number of people unknown; however, it will be modest at best).
    • 3d: Funded support for some carers.

National Disability Insurance
The Three Tiers of National Disability Insurance Scheme

NDIS Assessment Criteria

An assessment criteria has been developed to indicate the level of support needed from the following:

  • An individual can access support from the NDIS if he or she has a disability that is, or likely to be, deemed permanent. The meaning of permanent is to be considered as irreversible, even if it may be of chronic irregular nature (such as those who have significant and enduring psychiatric disabilities, rely on services from mental health system), AND at least one of the following conditions;
    • Such person would require significant ongoing support due to reduced functioning in self-care, self-management, communication, or mobility.
    • Be part of an early intervention group, which include people for whom intervention would be safe and improve outcomes (in cases of autism, acquired brain injury, cerebral palsy or sensory impairments), or for whom interventions would delay a decline in functioning (in cases such as Multiple Sclerosis and Parkinson's Disease).

Source: Australian Government Productivity Commission, 2012

NDIS: How is it funded?

It is estimated that by the time it's launched in 2018/19, the NDIS will have an annual cost of up to $15 billion. Every state government will contribute to a national fund which will form the basis of NDIS, which as of 2012, had a combined total of $8 billion - with a deficit of $7 billion in funding.

The Government has committed to putting aside $1 billion over four years to fund the planned trial program, to be launched in July 2013, to cover 20,000 people with a significant disability in select areas of South Australia, the ACT, Tasmania, the Hunter Region of NSW, and the Barwon region of Victoria.

The $1 billion in funding provided by the Australian Government will be utilised to the total administration and running costs, particularly for the first stage of building NDIS, and they include:

  1. Over three years from July 2013;
    • Individually funded packages for people with significant and permanent disability - $342.5 million.
    • Employment of Local Area Coordinators to provide a tailored approach to provide care and support to people with a disability - $154.8 million.
    • Assessment of needs of people with a disability in the proposed trial launch locations - $58.6 million.
  1. Over four years;
    • Preparation of the disability sector for the new way of delivering disability support and services - $122.6 million.
    • Building and operation of NDIS information technology system - $240.3 million.
    • Establishment of a new National Disability Transition Agency for coordination of implementation and management of the delivery of care and support to people with a disability, their families and carers in the proposed trial launch location until 2014.

Source: Parliament of Australia (Luke Buckmaster), 2012

Why is NDIS necessary?

According to National Disability Services (NDS), there are ten reasons why NDIS is crucial to provide quality care and support for the many Australians that are living with a disability, their families and carers, and it is needed in Australia because:

  1. The support for people with disability, their families and carers in Australia is inadequate, especially in times of crisis and more often than not, many slip through the cracks of Australia's safety nets.
  2. Australians with a disability, including their families and carers yearn for full participation in the social, economic and cultural aspect of the nation. However, these are not possible at times due to a number of barriers that are still present today, which prohibits their full inclusion.
  3. To reduce the level of physical, emotional and financial burden that families of people with a disability primarily have to be responsible for, due to the lack of support in place.
  4. There is currently an unfair disparity on the levels of support received by Australians with a disability, depending on how, when and where their disability was attained.
  5. The number of people with a disability is increasing and yet, the number of people who are able to provide unpaid care is falling, which can result in a significant increase of costs to government in the future.
  6. Having NDIS in Australia will mean that there will be consistent and regular provisions of care and support that are required, as a Medicare-type scheme, alongside with the secure and consistent funding that are necessary for these services.
  7. With a focus on early intervention and to provide support with an outlook to the future and long-term outcomes. NDIS will be fair, efficient and effective and it can maximise opportunities for independence, participation and productivity.
  8. Support will be tailored towards the person's disability and needs, with freedom of choice, focusing on individual needs and circumstances.
  9. The scheme would be considered as a long-term investment on a person's individual capacity rather than welfare, with early interventions, proper aids and equipment, training and development, which can result to more positive outcomes.
  10. All Australians can get a benefit from this scheme, as disability can affect anyone at anytime.

Note: NDS is the founding member of the National Disability and Carers Alliance, who run and support the NDIS campaign.

In addition, Ageing, Disability and Home Care (ADHC) of NSW, part of the NSW Department of Family and Community Services, stated that NDIS is needed to meet a growing demand for disability services, which is increasing by nearly 10% annually in NSW alone.

Source: NDS, 2013 and ADHC, 2013

What's next for the NDIS Bill?

The Government is set to launch the first stage of the National Disability Insurance Scheme (NDIS) in select areas, to ensure that it is implemented in a way that has been advised. This will be achieved through feedback by people with disability, their families and carers, service providers, and community organisations. A trial is set by the Government to also make sure that the system built is sustainable in the long run for people with disabilities, their families and carers.

If you are not living in the areas of the initial launch, the key is to be patient. The Government will provide more information based on the launch and how NDIS can progress into a full scheme.

Source: NDIS, 2013

New name for NDIS: DisabilityCare Australia

The National Disability Insurance Scheme (NDIS) is now known as 'DisabilityCare Australia.' The change in name was followed by the passing of the NDIS Bill by the Parliament in March 18th, 2013. Jenny Macklin, the Minister for Disability Reform, stated that the change reflects the core principles of NDIS and the name was chosen based on discussions with people with disability, their families and carers, various organisations and the general public.

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Richard Laycock

Richard is the Insurance Editor at finder, and has been wrangling insurance Product Disclosure Statements for the last 4 years. When he’s not helping Aussies make sense of the fine print, he can be found testing the quality of Aperol Spritzes in his new found home of New York. Richard studied Journalism at Macquarie University and The Missouri School of Journalism, and has a Tier 1 certification in General Advice for Life Insurance. He has also been published in CSO Australia and Dynamic Business.

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