A national crackdown on dodgy National Disability Insurance Scheme providers aims to protect participants and control costs, but it might also expose how deeply scams, false advertising and poor quality services have spread through the $50 billion program.
The National Disability Insurance Scheme now supports about 751,000 Australians and costs taxpayers more than $50 billion a year, making it more expensive than Medicare and on track to rival defence spending, yet regulators say a growing share of that money is being siphoned off by aggressive marketing, misleading claims and outright fraud. Over time a patchwork of registered and unregistered providers has sprung up around the scheme, and many participants rely on them to navigate complex rules and funding categories. That mix of rapid growth, vulnerable customers and limited oversight has created conditions where exploitation can flourish, from everyday overcharging to elaborate scams.
Regulators report that providers are routinely advertising services and products as “covered” by NDIS funding when they are not, such as all inclusive holidays, cruises, flights, dining out and even food ingredients, only for participants to later discover those costs are ineligible and not reimbursed. Investigators describe cases where people pay thousands of dollars for essential equipment like wheelchairs, hospital beds or high cost chairs that arrive damaged, missing crucial modifications or not matching their description, with some providers refusing repairs, refunds or replacements. A joint taskforce between the competition regulator and NDIS oversight agencies also finds that some providers bill for support hours that were never delivered, charge for essential products that never arrive or load contracts with steep exit fees, long notice periods and other unfair terms, while scam activity, from fake government messages to romance cons, appears to target NDIS participants more often than the wider community.
The bigger picture looks like a system where the vast majority of funding still goes to genuine support, but a noticeable slice is leaking into rorting and low value services, undermining trust and putting pressure on the federal budget. With around 16,000 registered providers and well over 150,000 unregistered operators in the market, tightening rules and stepping up enforcement seems to be one way the government hopes to slow annual scheme growth from more than 10% to about 6%, yet reforms may also unsettle investors in disability housing and small service businesses that built models on looser settings. Increased fines, court actions and closer scrutiny of misleading marketing suggest a tougher phase for providers is under way, but it is still unclear whether that will be enough to curb exploitation without restricting legitimate care.
