Caught in the crossfire: Why even the best-run NDIS providers are under pressure
- Rachel Riley
- 15 hours ago
- 3 min read
As scrutiny across the sector intensifies, a new wave of suspended claims, delayed payments, and unplanned investigations is sweeping through the disability services landscape - disrupting operations, straining cash flow, and testing the resilience of trusted organisations. Even the most compliant NDIS providers are feeling the heat.
For many providers, it feels like being penalised for doing the right thing.
The cost of compliance is climbing
Over the last 12 months, the regulatory burden on NDIS providers has surged. New audit requirements, policy overhauls, and a spike in whistleblower complaints have translated into real financial consequences - even for those with clean records. Anecdotal reports of providers having claims frozen without warning are becoming more frequent. Entire revenue cycles are stalled for weeks while investigations play out.
This isn’t about bad actors being caught. It’s about good providers being caught in the crossfire.
With tighter regulations, frequent audits, and escalating penalties, providers are spending more time on paperwork than participant care. 60% of respondents to our NDIS Provider Outlook Survey cited ‘Regulatory changes’ as likely to have the biggest impact on the sector in 2025.
In late 2023, over $1.6 million in fines were issued as part of the NDIS Commission’s compliance crackdown. Yet, 53% of providers say the NDIS Quality and Safeguarding Framework fails to support service quality, and 21% report their risk and compliance frameworks need urgent improvement (StewartBrown).
While strong governance is essential, compliance should enable quality service delivery—not hinder it.
The reality is, much of the recent pressure stems not from new rules, but from the way existing ones are being enforced. Increased funding for the NDIS Quality and Safeguards Commission has enabled a more aggressive audit posture in line with the government’s ‘dodgy providers’ narrative. Tip-offs are taken more seriously. Automated triggers for high-risk billing behaviours are sweeping up providers for basic administrative errors.
And while the intent is to eliminate fraud and uphold participant safety, the execution has left many providers - especially those operating at scale - vulnerable to unplanned exposure.
What’s driving the shift?
Three key forces are behind the current pressure:
Public and political scrutiny. Following high-profile media coverage of abuse and mismanagement, the Commission is under pressure to demonstrate stronger oversight. This includes faster investigations, tougher enforcement, and visible action.
Data-driven audits. Algorithmic flagging of billing anomalies - often without context - is fuelling investigations into providers with no prior breaches. Legitimate services that look ‘non-standard’ on paper can still trigger review.
Rising whistleblower activity. Staff, former employees, and participants are increasingly using internal channels to report concerns - sometimes valid, sometimes not. Each report can trigger a full-scope review, regardless of merit.
So, what can NDIS providers do?
The providers weathering this storm aren’t the ones doing more paperwork. They’re the ones building operational resilience - anticipating risk, streamlining evidence collection, and getting ahead of compliance before it becomes a crisis.
Here’s what forward-thinking providers are doing now:
Automating audit readiness: Tools like attestations, role-based access, and scenario testing are being used not just for internal compliance, but to pre-empt regulator requests.
Tracking contract exposure: Linking vendor, staff, and SLA data ensures obligations are always in view - and defensible when challenged.
Building a culture of readiness: Instead of scrambling post-investigation, smart teams are scenario-planning the top audit risks now.
Looking ahead
The pressure isn’t likely to ease. If anything, enforcement will increase as the NDIS undergoes structural reform and funding debates escalate.
But for providers who see compliance not just as a cost - but as a critical layer of business resilience - there’s a path forward.
In our NDIS Provider Outlook Report 2025, we ask sector leaders what’s changing, what providers can expect next, and how to prepare for a compliance environment that’s evolving fast.
