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TL;DR

Recent changes to children’s autism supports—including the shift toward ‘Thriving Kids’—aim to moderate NDIS growth, but they won’t close the budget gap by themselves. Costs are driven by overall participant numbers and, more importantly, by intensive supports for complex disability groups. Expect tighter provider rules, pricing scrutiny, stricter planning, and targeted psychosocial initiatives alongside foundational supports for children.

Executive Summary

The NDIS cost curve remains steep even after planned autism pathway changes. While moving some early-intervention needs to mainstream ‘foundational supports’ may save money over time, the Scheme’s growth is also shaped by high‑intensity supports (e.g., psychosocial disability) and provider/pricing settings. The Government is signalling a multi‑pronged response: stronger provider registration and compliance, competitive pricing benchmarks, firmer planning budgets, anti‑fraud enforcement, and separate psychosocial funding—all while preserving the NDIS for people with permanent and significant disability.

Key Facts (Verified)

• 2024–25 NDIS outlays: ~$46.3 billion across ~739,000 participants; projected to exceed $100 billion within a decade.
• Current annual growth ~10.8%; Government aims to reduce to ~8% by July 2026 and ~5–6% by the end of the forward estimates.
• Children with mild–moderate autism/developmental delay: ~214,865 participants (~30% share) but just under 7% of total spend (~$3.1b).
• Thriving Kids: a ~$4b, five‑year initiative to deliver foundational supports in mainstream settings; transition from July 2026, with fuller rollout into 2027.
• Provider market: most providers are unregistered (roughly 15 of every 16), prompting planned registration and quality reforms.
• Planned budgeting changes (from Sep 2025) expected to deliver ~$19.3b in savings over four years.
• Psychosocial disability: ~65,000+ participants drive ~${6}b in outlays; a separate ~$6b package is being scoped to support this cohort outside individual NDIS plans.
• Public sentiment tolerates cost controls, provided families don’t ‘fall through the cracks’ and regional equity is protected.

Where the Money Goes (and Why Autism Changes Aren’t Enough)

While children with milder needs are numerous, they consume a relatively small share of total NDIS spending. The heaviest budget pressure comes from higher‑intensity supports for complex disabilities and from pricing and provider market dynamics. Autism pathway changes moderate growth but do not materially shift the cost base on their own.

What ‘Thriving Kids’ Changes—and What It Doesn’t

Thriving Kids moves eligible early supports into schools, childcare, and community health. This should be more cost‑effective than thousands of small individual packages. However, families may face out‑of‑pocket medical expenses and uneven local capacity unless state systems are well‑funded and coordinated.

Additional Levers the Government Is Weighing

• Stronger Provider Registration & Compliance: lift quality, reduce fraud, and bring more of the market under audit obligations.
• Competitive Pricing: address ‘outlier’ price points compared with aged care/veterans’ services to improve value for money.
• Tighter Planning & Budget Caps: new methods to curb overspends and align funding to assessed functional needs.
• Fraud & Integrity: sustained investigations and prosecutions to deter misuse of funds.
• Targeted Psychosocial Funding: develop mainstream/mental‑health pathways so fewer high‑intensity cases rely solely on the NDIS.
• Commonwealth–State Cost Sharing: ensure states co‑fund foundational supports and scale up service capacity, especially in regional areas.

Risks & Equity Watchpoints

• Out‑of‑Pocket Costs: families may shoulder more medical fees without careful design of Medicare/state coverage.
• Regional Capacity: workforce and service gaps could leave rural families waiting longer.
• Provider Exit Risk: sharper pricing and compliance must be staged to avoid supply shocks.
• Implementation Timelines: transitions across 2026–27 demand clear communication and continuity of care.

Practical Takeaways for Families

• Keep documentation current (school reports, therapy notes, GP/paediatric letters) to support referrals during transition windows.
• Ask your school and local health services about foundational support pathways and any fee coverage available.
• If needs are substantial and ongoing, check NDIS eligibility early; don’t pause essential therapies while pathways are clarified.
• Monitor government updates on Thriving Kids and psychosocial reforms; confirm what applies in your state.

Practical Takeaways for Providers

• Design dual‑pathway intake (NDIS vs foundational supports) with clear triage and hand‑offs to schools/community health.
• Strengthen quality systems ahead of tighter registration rules; be audit‑ready.
• Stress‑test pricing and service mix under prospective fee benchmarks; avoid sudden changes for vulnerable clients.
• Engage regionally: join local health/education networks to coordinate referrals and capacity.

Careable’s Commitment

Careable will help families navigate funding changes with clarity and compassion. We’ll maintain continuity of supports, coordinate with schools and local health services, and advocate for equitable access—especially for regional communities.

Frequently Asked Questions (Confirmed)

• Is the NDIS being replaced? — No. The NDIS remains for people with permanent and significant disability.
• Will autism pathway changes fix NDIS costs? — Not alone. Savings require broader pricing, planning, and psychosocial reforms.
• When does Thriving Kids start? — Transition from July 2026, with fuller rollout into 2027 (subject to state capacity).
• What about psychosocial disability? — Government is scoping separate funding so fewer complex cases rely solely on the NDIS.

Source

The Sydney Morning Herald (Aug 25–26, 2025) reporting on NDIS cost pressures, autism pathway changes, provider registration, pricing, planning reforms, and psychosocial initiatives; ministerial comments and projected savings figures.

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