NDIS reforms: I-CAN, Thriving Kids, and the future of Allied Health

Big changes are coming for Allied Health in the NDIS. Here’s what you need to know.

Let me preface this by saying that I want every participant in Australia to have more access to Allied Health. And I want every clinician to be paid more for the work they do. But we also need to be realistic. The system has limits, and the way we practice as a sector has consequences.

If you are reading this, you are probably one of the many ethical providers or clinicians doing the right thing. This is not an attack on clinicians, OTs, or on report writing more broadly. A well-written, value-for-money report is incredibly valuable. But we cannot ignore that overbilling and overservicing do exist in our sector, and often it is not entirely the clinician’s fault. Much of it comes back to a system that is broken and in need of fixing.

With reforms now rolling out, from support needs assessments and the I-CAN tool to the Thriving Kids program, it is worth asking the question: where to now for Allied Health in the NDIS?

NDIS report writing – are we overservicing?

Report writing has become an overserviced area in the NDIS. Families sometimes pay thousands for assessments, yet NDIA staff have openly admitted they cannot process reports that stretch to hundreds of pages. In February this year, former NDIA CEO Rebecca Falkingham famously said that her staff do not always read reports . She copped a lot of criticism for that comment, but honestly, I have seen plenty of excessive, over the top reports that I could barely get through myself. And I am a clinician, not a lay person.

The Grattan Institute has also raised concerns about conflicts of interest in report writing. Clinicians can be incentivised, or feel pressured, to write reports that secure more funding for participants. Sometimes that pressure comes from families who want additional equipment or hours, and sometimes from providers (for example, SIL or support worker organisations) pushing for more billable hours. We have all heard the stories or experienced it ourselves.

A strong, ethical clinician will remain objective and focus on what the participant truly needs. But there are also unethical providers, and inexperienced clinicians, who bend to this pressure. This one reason why report writing has become such a contested and scrutinised part of the scheme.

From a physio’s perspective, and maybe this is a “hot take,” but in general I would say that a participant usually gets more benefit from 15 hours of direct clinical therapy than 15 hours of report writing. The NDIA seems to think so as well.

Functional Capacity Assessments (FCAs)

FCAs in the NDIS have honestly gotten out of control. There are ethical providers and clinicians producing excellent reports, but too often they are not read, or participants end up in an exhausting process such as the AAT to have recommendations approved anyway.

Pricing is another issue. Many providers charge a flat fee of up to 15 hours for an FCA, regardless of how long it actually takes. A new graduate might need the full 15 hours, but an experienced clinician may complete a thorough FCA in eight. Billing the same in both cases is, in my view, unethical with the way the NDIS is currently set up (billing in arrears for time spent). It would be a different story if there were a flat fee model for reports — which I think the NDIS may eventually move towards.

The rise of AI-assisted report writing adds to the problem. Reports that once took days can now be completed far more quickly with AI tools, yet in some cases providers are still billing the full 15-hour block.

And then there is consistency — or rather, the lack of it. Quality, length, and templates vary wildly between providers, states, and even individual clinicians. It is messy, confusing for participants, frustrating for planners,and ultimately unsustainable.

The Grattan Institute has pointed out that this kind of overservicing and inconsistency undermines public trust in the scheme. If FCAs are to remain a core part of the system, they need to be consistent, proportionate and genuinely focused on participant outcomes — otherwise they risk eroding confidence in both the process and the profession.

NDIS pricing and advocacy – where next?

When the July 1 pricing changes came through, there was a strong push from the sector to both roll back travel cuts and also secure higher hourly rates. Realistically, both were never likely to happen together. The Government is under pressure to contain scheme costs.

That raises a difficult question: if we want rates to increase in future, what are we willing to trade off? My view is that direct clinical time with participants should be prioritised over report writing or travel. I also believe we should be pushing for higher recognition of complex services and more experienced clinicians.

The fact that a sole trader with limited experience can bill the same as a senior clinician in a structured service is difficult to defend. And the reality that a new graduate can bill 15 hours for an FCA while a senior might do it in eight, with the participant still paying 15, does not sit well ethically. This is one of the unintended outcomes of a price-capped market.

A brief history of Support Needs Assessments

The shift towards structured assessments has been coming for years. The NDIS Review concluded that functional assessments had “no one-to-one relationship with support needs” and too often focused on deficits rather than strengths. They required costly Allied Health reports and led to inconsistent planning decisions.

It is worth remembering that this is not the first time the NDIA has tried to replace external reports with standardised assessments. In 2021, the government proposed Independent Assessments, where contracted health professionals would conduct short, standardised evaluations. The model was met with widespread backlash from participants, providers, and state governments, and was ultimately abandoned (ABC News).

The current approach is being pitched as different. From September 2025, the NDIA licensed the I-CAN v6 tool, which maps support needs across 12 domains such as mobility, self-care, communication, and domestic life. It scores both the frequency and level of support a person requires. Accredited assessors, including Allied Health professionals and nurses, will conduct these structured assessments, with budgets set according to identified needs (NDIS announcement).

From mid-2026, participants aged 16 and older will begin going through interviews of up to three hours, replacing the requirement to provide external evidence from family doctors or Allied Health professionals (SMH).

The Grattan Institute has argued for a fairer, needs-based system, noting that diagnosis-based access lists create inequities and drive demand in ways that were never intended. They also caution that unless data is closely monitored, structured tools risk underfunding some participants while overfunding others.

The Thriving Kids program and foundational supports

Another major reform is the Thriving Kids program, rolling out from July 2026. Nearly 43% of NDIS participants are children under 14, almost double original forecasts. Minister Butler has pointed out that some children with moderate needs are receiving more than 70 therapy sessions per year without clear evidence of benefit (Press Club speech).

The Grattan Institute has also highlighted this trend, noting that children with developmental delay or autism now make up around 44% of all participants. They argue that this level of demand was never anticipated and is a key driver of costs and public concern about sustainability.

Thriving Kids is designed to respond by shifting some services outside the NDIS. It will provide early intervention and family coaching for children aged 0–8 with mild to moderate developmental delay, delivered through universal health checks, early learning pathways, and home-based coaching. The program sits within the broader foundational supports framework.

Grattan has argued that targeted foundational supports can often deliver equal or better outcomes than NDIS-funded therapy, at lower cost, and in more natural settings such as schools, homes, and community centres. For Allied Health providers, this will mean fewer children with NDIS plans, but greater opportunities to work in mainstream and community contexts. OTs, speech pathologists, and physios will be central to lead-practitioner and coaching models.

🎧 Want to dive deeper? You can hear me unpack the Thriving Kids program in more detail on the Profitable NDIS Provider Podcast (Apple), Podbean, or YouTube.

Turning the mirror on ourselves

It is easy to point the finger at all the other areas of overspend and overservicing in the NDIS. That is not the point of this article — I am focusing solely on Allied Health.

The reality is that as a sector, Allied Health can be very defensive and resistant to any criticism. We are quick to highlight inefficiencies elsewhere, but slower to turn the mirror on ourselves. And when I say ourselves, I do not just mean the many ethical clinicians and providers who are doing the right thing. We also need to acknowledge that there are plenty of dodgy practices in our own backyard. Pretending otherwise does not help us.

If you follow my content, you may have noticed that I try to subtly call out dodgy Allied Health practice. I am not doing this to criticise for the sake of it, but to try to level the playing field. Ultimately, I want ethical providers and clinicians to win.

What does this mean for Allied Health?

So what does all of this actually mean for Allied Health providers?

We will almost certainly see a decrease in report writing time for non-complex participants. That does not mean reports will disappear altogether — I believe there will still be a need for high-quality assessments and reports for participants with complex needs. But for more straightforward cases, the demand for lengthy reports is going to fall.

We are also likely to see a reduction in work for the demographic described in the Thriving Kids program: children with mild to moderate developmental delay or autism. At the same time, new opportunities may emerge in other streams such as Medicare, private clients, and in supporting the rollout of mainstream and foundational supports. Exactly how this plays out is uncertain. What is certain is that things will change.

There is risk in this shift, no question. But there is also opportunity. Ethical providers will be fine. There will always be plenty of work for Allied Health clinicians in the NDIS. The focus is simply moving away from areas that are seen as overserviced or not providing value for taxpayers money.

In many ways, this could be positive. Less time on paperwork and more time in direct clinical work. The possibility of more sustainable pricing if inefficiencies are cut out. A system that better recognises and rewards complex, skilled, and ethical practice.

Having said all this, providers need to manage their risk. Prepare for the worst, hope for the best. If you employ staff, you need a Plan B, Plan C — maybe even a Plan Z. The organisations that plan ahead, adapt quickly, and stay grounded in ethics and outcomes will be the ones that thrive in whatever the next version of the NDIS looks like.

Practical steps for providers

Value direct therapy time

Position face-to-face therapy as the core of what we do. Make it clear in advocacy and business models that clinical time is where impact is greatest.

Differentiate by experience

Push for recognition of senior clinicians and complex services. Tiered pricing or structured recognition of expertise could help address inequities where new graduates and seasoned specialists bill the same.

Streamline report writing

Not all reports are bad. Far from it. But we should move towards shorter, outcome-focused formats that add genuine value. AI tools can help, but billing should reflect actual time and expertise, not inflated blocks.

Additionally, if you’re thinking of diversifying from NDIS into Aged Care - you are going to need to write shorter, more efficient reports.

Engage with reform, not just resist it

The system is broken in parts, and reforms like iCAN and Thriving Kids are an attempt to fix it. They may not be perfect, but ignoring or opposing all change will not help our sector.

Diversify services

Look beyond report-heavy work. Explore foundational supports, early intervention outside the NDIS, and aged care reforms like Support at Home. Consider mainstream partnerships with GPs, schools, and early learning centres.

You can view all my Support at Home resources here

Focus on outcomes and quality

Shift your messaging, supervision, and advocacy towards outcomes, not outputs. Show how Allied Health prevents hospitalisations, supports independence, and saves costs long term (view my article on Quality here).

Strengthen governance and ethics

Sole traders and under-supervised clinicians billing high volumes is a reputational risk. Build governance systems, supervision structures,and clear ethical frameworks.

Plan for sustainability

Use pricing reforms as a chance to re-cluster caseloads, reduce reliance on travel, and test hybrid models that combine mobile, clinic-based, and telehealth delivery.

Conclusion

The NDIS is evolving, and so must we. This is not about taking sides with the NDIA or with providers. It is about recognising the pressures on both, and the reality that overservicing in some areas makes it harder to argue for fairer recognition elsewhere.

Participants deserve access to quality therapy. Clinicians deserve fair pay for their expertise. Taxpayers deserve a system that uses money wisely.

For Allied Health, the way forward is not volume. It is clarity, quality, and balance.

If you are an ethical provider, these changes are not the end. They are a chance to adapt and thrive.

If you want help navigating these reforms or exploring how to diversify your services, book in a free 20-minute strategy call with me.