Unfair pricing in the NDIS

Are you a National Disability Insurance Scheme (NDIS) participant? Have you ever been given a quote for a disability product or service and wondered if the pricing is higher, simply because you’re funded for the support you’re after? If you have, you’re not alone.

In the NDIS, inflated pricing is sometimes called ‘price differentiation’ or a ‘twin pricing regime’. It occurs when a provider charges a participant more than they’d charge a person who’s not in the Scheme.

An example of this is when a basic model aluminium shower chair has two price tags: $600 for NDIS participants and $150 for everyone else. The exact same shower chair – the only difference is, one is sold as an NDIS product.

Australia’s Competition and Consumer Act makes it illegal to engage in unfair pricing, but pursuing a case of this nature can be expensive and requires substantial evidence.

That’s why the NDIS Quality and Safeguards Commission has homed in on price differentiation, and announced it's making providers accountable under new rules, which apply to goods – things you can touch, feel and see.

The new pricing rules are:

1. Providers must not charge a higher price for goods to an NDIS participant than to a person who is not an NDIS participant.

For example, a provider must not sell a shower chair to an NDIS participant for $600 and sell the same chair to a member of the broader community for $150.

2. Providers cannot say (e.g., advertise or tell people) they charge a higher price to NDIS participants.

For example, a provider cannot advertise on its website a sale price for a shower chair if it will not offer the same price to an NDIS participant.

There are countless examples of products being advertised or sold at inflated prices to NDIS participants, purely because they have an NDIS plan and funding, and the new pricing rules crack down on that.

But a twin pricing regime isn’t exclusive to products and a question that’s repeatedly asked is ‘Will these rules apply to other supports, including services?’.

At this stage, while the Commission has not extended its rules beyond products, it has said further determinations may be made in the future, including about services such as allied health or in-home supports.

What’s important to understand about services is that some people with disability have more complex requirements than other service users, and therefore providers may attach a higher price to servicing people with higher needs.

That’s why it’s more difficult to enforce a framework around price differentiation for services funded by the NDIS, but although it may take some time, the Commission had certainly indicated it’s looking at it.

Be sure to shop around

If you’re considering a product or service funded through your NDIS plan, be sure to shop around.

If it’s a product you’re after, compare prices from at least two providers, if not more – and make sure your decision factors price in, along with responsiveness, customer service, reputation and other factors.

This can be harder to do with services, because unlike comparing two identical products, there are a large number of variables in relation to services – such as the experience of the provider, their location, service offering, flexibility and reputation, all of which may impact a purchasing decision and warrant paying a higher price.

For more information about the NDIS price differentiation rules, click here.

The Australian Government has also released information about the pricing crackdown, which you can read here.