The NDIS FCA Problem Nobody Wants to Talk About

How a lack of standards created a market failure, shaped a profession, and why the overcorrection isn't the answer either

The NDIS FCA market has no standardised template, no minimum standard and no consequence for poor work. And nearly everyone debating it has a financial interest they haven't acknowledged. Here's mine:

I co-founded a national Allied Health business and scaled it to 300+ clinicians, with Occupational Therapy being by far the largest discipline. I commissioned, read and delivered hundreds of FCAs. I received reports from external providers of every calibre and now consult to providers across the sector. I've seen what happens to plans when an FCA is good and what happens when one isn't (and I've seen plenty of both). The ethical providers are usually the ones picking up the pieces: underbilling, taking on work they might not get paid for, writing thorough assessments while the system pays the same rate for a low-quality report that costs the participant just as much (if not more).

I've never written an FCA myself. My lens is operational and commercial, not clinical. I'm a Physio by background. FCAs can be written by a range of clinicians including Physios, Social Workers and Nurses — but OTs write the vast majority, and the FCA market has shaped that profession more than any other. Hence, that discipline will be the focus of this article

The business I built generated millions of dollars of revenue from FCA-related work. That bias applies broadly across the sector, including to many of the people most active in the current debate. The difference is whether you acknowledge it or pretend it doesn't exist. And pretending it doesn't exist weakens your advocacy, because anyone outside the Allied Health bubble can see straight through it.

Acknowledging the Good Work

There are phenomenal OTs across the country writing thorough, objective reports and often going above and beyond to remediate someone else's substandard work. Many of the people advocating right now are these practitioners. They care about quality. They bill appropriately. They take professional pride in their work.

This article is not about them.

But they already know the problem exists because they've lived it. They've seen shockingly low-standard reports billed at 15 hours and accepted by a system that never questioned them. They've seen participants turn up with lengthy reports that were a waste of funding, and need to be rewritten. They've watched the quality floor drop while the billing stayed the same, and the system never distinguished their work from the rest.

How We Got Here

The NDIS planning process has always needed functional evidence. The NDIA requires information about how a participant's disability affects their daily life to inform funding decisions. But the NDIA never issued a standardised process for how that evidence should be produced. No standardised template. No minimum standard. No quality gate at submission. No consequence for poor work. The NDIA's own provider guidance positions clinicians as evidence providers but sets no minimum standard for what that evidence should contain or how it should be structured.

FCAs organically filled that gap. The planning and review process was fundamentally under-designed, and the market created a product to fill the vacuum. The concept draws from the Functional Capacity Evaluation model used in workers compensation and CTP schemes. In workers compensation, functional assessments typically follow published practice standards. In NSW, SIRA publishes specific methodology requirements for functional assessments, and providers must be approved under a regulatory framework that can revoke approval for non-performance. WorkCover WA published updated provider principles and standards of practice as recently as July 2024. The specifics vary across jurisdictions and schemes, but the principle is consistent: there are defined standards and consequences for getting it wrong.

The NDIS never built any of those mechanisms. That gap has been there since the beginning.

The Market Failure

The scheme created an incentive where the same provider both delivers therapy and generates the evidence justifying further funding. A market with no incentive to self-regulate, and it didn't. The quality floor dropped and the volume ceiling rose. More recently, AI-generated content has entered the pipeline.

The absence of time benchmarks created a backwards incentive. An experienced OT who can produce a thorough, high-quality FCA in 10 hours costs a participant less than a new graduate who takes 15 hours to produce a lower-quality report. Yet the system never distinguished between the two. That's not a criticism of new graduates who are learning the craft. It's a system with no mechanism to differentiate quality or efficiency at any level. Many providers charge a flat fee of up to 15 hours regardless of how long the work actually takes, and the rise of AI-assisted report writing has widened that gap further. Under a system that requires billing in arrears for time spent, that's difficult to defend.

Former NDIA CEO Rebecca Falkingham famously said at a Senate Estimates in February 2025 that her staff "can't read the 280-page reports that they get." The system is broken from both ends: providers billing excessively and the NDIA unable to even process what it is paying for.

The NDIA's own Therapy Supports guideline defines funded therapy as either capacity building supports (building new skills with specific goals and timeframes) or maintenance supports (preventing or delaying functional decline). Report writing appears in the guideline only as an evidentiary input to planning decisions. Yet in practice, a significant share of therapy budgets has been consumed by FCA report writing: a product the scheme never explicitly defined, standardised or separately funded. Participants have been spending plan funding on evidence gathering rather than on the supports that funding was intended to provide. For many, the practical effect was being told they needed to spend thousands of dollars of plan funding on a report before the planning conversation could even happen.

A lot of providers make very good money from the FCA market. Report writing is a high-margin service line. It can be done from home with significantly lower overheads than in-clinic or in-home appointments. The volume is reliable, the demand is built into the planning cycle, and there has been no quality threshold that might interrupt the revenue. That commercial reality shapes how providers engage with reform. Many of those arguing to preserve the current assessment model have significant financial exposure if it changes. That doesn't make their arguments wrong. But not naming that financial interest, or pretending it doesn't influence your position, undermines the credibility of the advocacy. To policymakers, it’s obvious.

The Line Between Assessment and Advocacy

There's a deeper issue beneath the quality problem. Ask the sector what a good FCA looks like and the answer almost always centres on the funding outcome. A good report gets the participant more support. A great report gets everything approved. But a high-quality assessment should be measured by its accuracy, not whether it secured a particular funding result. The sector has redefined quality to mean advocacy, and it happened so gradually most people don't realise the goalposts moved.

Look at the language that surrounds OTs and FCAs. "Persuasive" reports. Reports that "support funding applications." CPD marketing, provider websites and social media commentary often frame an OT's NDIS role around report writing that secures plan funding. The framing is so normalised it goes unchallenged.

An objective assessment describes function, identifies barriers and presents evidence. A funding-oriented report argues for a specific outcome. The language around FCAs increasingly sounds like the latter. It's worth asking: when did impartial, objective assessment stop being the standard?

What the scheme actually requires

The structural framework of the NDIS is clear on this point. Under the NDIS Act, only NDIA delegates can determine whether supports are reasonable and necessary. The NDIA's own provider guidance positions clinicians as evidence providers: "the evidence you provide helps us determine whether the supports you are recommending meet our reasonable and necessary criteria." The clinician's role is to assess function and present evidence. The funding decision sits with the NDIA.

The NDIS Quality and Safeguards Commission has gone further, stating directly that providers delivering NDIS supports "cannot objectively offer" advocacy, and that "even with good intentions, assuming an advocacy role may unintentionally compromise a participant's autonomy." The Commission has explicitly clarified that NDIS providers "must not offer, market, or present their services as independent advocacy" if they also provide supports to that person.

What the incentives actually reward

Yet the structural incentives push in the opposite direction. None of this requires any individual clinician to act in bad faith. The incentive structure does the work on its own. The clinician is typically engaged by the participant or their Support Coordinator. The participant wants funding approved. The clinician depends on the participant or referral network for ongoing revenue. The NDIA relies on the clinician's report as its evidence base but lacks the clinical expertise to independently verify the assessment.

This plays out in everyday practice. A participant or Support Coordinator asks the OT to recommend funding for a specific item or support in the FCA. The experienced clinician stays objective and reports what the evidence supports, even if that means a difficult conversation. But a less experienced OT under pressure to hit billable hours targets may not feel able to push back. A sole trader or business owner who depends on that referral relationship for revenue faces the same tension. And as the market gets more competitive and Support Coordination funding shrinks, the pressure to keep referrers happy intensifies. Say no and you risk losing the client or the referral source. Say yes and you've crossed the line from assessment into advocacy. It's a common and genuinely difficult position that OTs are placed in, and the system created it.

The scheme never clearly defined where clinical recommendation ends and funding advocacy begins, and it never created mechanisms to enforce the boundary. So the boundary eroded. Individual clinicians didn't create this dynamic. The scheme did, by building a system where the same provider delivers therapy, writes the evidence and benefits from the funding outcome, with no structural separation of roles. Most clinicians are acting rationally within the incentives they've been given. The problem is the incentive structure itself.

When the evidence base feeding into planning decisions is structurally incentivised toward advocacy rather than objectivity, the funder will eventually seek a mechanism it controls. Hence, I-CAN.

How FCAs Shaped the OT Profession

Occupational Therapy is a phenomenal and versatile profession. Functional assessment, environmental analysis, capacity building, therapeutic intervention, clinical reasoning across complex presentations. The scope of practice extends well beyond report writing.

But over the past decade, the NDIS FCA market has significantly influenced how Occupational Therapy is perceived externally and in some cases how OTs define their own professional identity. The NDIS created demand for FCA reports that was effectively unlimited, well-funded and quality-blind. That pulled workforce capacity toward report writing and away from direct therapeutic work. It shaped graduate career paths, business models and service structures around a product the scheme was willing to fund at volume with no quality oversight.

The practitioners who do the best clinical work have watched their profession become increasingly defined by a market artefact. The FCA problem is a scheme cost issue. It's also a professional identity issue that the sector needs to reckon with.

The Missing Standard

The NDIA already provides standardised templates for Assistive Technology reports. That model exists. It sets baseline expectations that assessors must meet. The NDIA also sets clear content expectations for therapy progress reports in its Therapy Supports guideline: measurable functional gains, evidence of progress toward goals, how independence has increased or been maintained, barriers encountered and best-practice recommendations. Yet the NDIA never set equivalent standards for the assessment reports that feed into planning decisions in the first place.

Allied Health peak bodies could have led the development of a profession-endorsed template and quality framework. I'm not aware of a published position from any peak body on standardised FCA templates or minimum quality standards. If one exists, I'd welcome the correction.

Either the NDIA or the sector's peak bodies had the opportunity to create guardrails. Neither did. That's a meaningful part of why we now have I-CAN, and why the government previously tried the independent assessment model. The people in government looking at the numbers know the system is broken.

That's why resisting change while defending the status quo is a losing strategy. The reform is coming regardless. The question is whether the sector shapes it or has it imposed.

The Overcorrection

The NDIA saw the quality problem, the cost problem and the consistency problem, and responded with a completely different model.

I-CAN and the planning shift

I-CAN addresses consistency. A standardised tool applied by trained assessors will produce more uniform outputs than an unregulated report-writing market. That's a legitimate goal. But the implementation introduces real risks. I-CAN was validated as a needs assessment tool, but the methodology linking assessment scores to budget amounts has not been publicly disclosed or independently validated. The appeal pathway is unclear. At an October 2025 Joint Standing Committee hearing, NDIA Deputy CEO Aaron Verlin confirmed that Needs Assessors will not necessarily be Allied Health professionals; the NDIA plans to recruit based on “soft skills” such as empathy and communication rather than clinical qualifications. For complex presentations, replacing clinician-generated evidence with assessments conducted by people without clinical training is a meaningful risk.

Under the new planning framework, the I-CAN assessment determines the therapy categories a participant can access. The clinician's role shifts from being the primary evidence generator to working within categories pre-determined by the NDIA's assessment.

The independent assessments precedent

There is historical context the sector should be honest about. In 2020-21, the then-Coalition government proposed mandatory independent assessments: standardised functional assessments conducted by NDIA-contracted Allied Health professionals with no prior relationship to the participant. Assessors were required to hold relevant Allied Health qualifications and a minimum of 12 months clinical experience. Peak bodies, clinicians. the disability community, the Labor opposition and state disability ministers rejected the proposal. It was formally abandoned in July 2021. The concerns were legitimate: lack of co-design, insufficient evidence, no right of appeal, and a risk that standardised tools would fail to capture individual complexity.

But the underlying problem that motivated the proposal... was never resolved. The sector successfully killed the mechanism without addressing the cause. Peak bodies claimed it as an advocacy win. Five years later, I-CAN is here. The structural logic is almost identical: a standardised tool, applied by NDIA-controlled assessors, replacing clinician-generated evidence. The difference is that the 2021 model required qualified Allied Health professionals. The current model does not.

When the sector blocks reform without offering an alternative that addresses the underlying problem, it doesn't go away. It just gets solved without you.

Where This Leaves Us

You can argue that I-CAN is flawed. You'd be right. But you can't argue that in good faith while pretending the current system works. The NDIS Review, the NDIA and stakeholders within the sector have all identified it as failing. The sector tried outright resistance with the NDIS APR and PAPL price changes in July 2025. It didn't work. Government will not engage with advocacy that amounts to "stop changing things" when the system being defended is one they've already decided is no longer fit for purpose.

I previously wrote about why Allied Health advocacy keeps hitting a ceiling when it leads with hardship rather than value. The FCA debate is the same dynamic.

The OT profession is broader, deeper and more valuable than the FCA market the NDIS created. Criticism of I-CAN is legitimate. Defence of the status quo is not. The FCA market is out of control. I-CAN skews too far in the other direction. The right answer is probably somewhere in the middle: a system with real standards and real consequences for poor work, but one that preserves clinical input for the people whose lives depend on it.

The sector's most credible path forward is advocacy that acknowledges the failures of the current system, identifies specific risks in what replaces it and proposes that middle ground. The sector needs leadership that demonstrates that difference publicly and builds reform around it.