Greenacres will be forced to cut its services for people with a disability unless the government acts to fix ongoing issues with the National Disability Insurance Scheme.
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CEO Chris Christodoulou said the disability service provider was running one-on-one support at a loss of 5 to 18 per cent under the NDIS.
"Greenacres, and other providers in the Illawarra, are finding it really difficult to do one-on-one support because we are losing money as a consequence of the government not providing enough funding," he said.
"It's already meant some providers in the region have stopped doing that one-on-one support that is so vital, particularly for those with complex needs.
"And while Greenacres will continue to honour the agreements we have with individuals, if the pricing doesn't increase then we won't be able to take any new participants that require one-on-one."
Mr Christodoulou said providers have long called for a new independent pricing body for the scheme.
"The government and NDIS after four years have still not determined proper funding for disability enterprises," he said.
"Either they're completely incompetent or they want to see us fail, because no-one can understand how they can't come up with a new funding structure."
Mr Christodoulou has backed a new National Disability Services (NDS) campaign launched on Tuesday, which calls for urgent improvements to the way the NDIS is administered.
"We do support the NDIS and many people with disabilities are really benefiting from it - but there's also many who are not," he said.
"That's because the way the scheme is implemented - it's overly bureaucratic and there's a lot of red tape which is driving up our costs as service providers.
"If things don't change it will mean a number of services we currently provide are not viable anymore and that will impact on people with disabilities - the people the NDIS is supposed to support."
Greenacres supported employee Jade Stewart features in the NDS media campaign material.
"At the moment, I have assistance to get ready for work in the morning, to get to places like doctors' appointments and to get out socially," he told the Mercury.
"Because of this my independence has greatly increased. To lose this one-on-one support would feel like I was going backwards - it would be so disappointing.
"The NDIS has allowed me to choose great providers. I would be very upset if any of my providers had to reduce services or close down."
According to research by the NDS, one in 10 disability service providers have discussed closing - and more than a quarter of service providers reported a loss or deficit. More than half said they would have to reduce the quality of services under the current pricing model.
NDS president Joan McKenna-Kerr said providers were launching the campaign in the lead-up to next week's Federal Budget, where she said the government had an opportunity to address the scheme's systematic issues.
"In particular we are finding providers reluctantly withdrawing one-on-one care services because the delivery models are just not viable," she said.
"This is leaving those participants in the scheme with the most profound challenges, finding it harder to find the care they need."
As well as a pricing body, the NDS also wants a national workforce strategy to support the sector in delivering the scheme.
NDS acting CEO, David Moody, said if the sector experienced market failure the NDIS could collapse, leaving almost half a million Australians with disability without services.
"We continue to support (the NDIS) 100 per cent as a vital reform for Australians with disability," he said.
"However as a direct result of the way it is being administered, more than half of our members have foreshadowed they will reduce the quality of services unless NDIS pricing better reflects the cost of actually delivering services."
A spokesperson for the National Disability Insurance Agency (NDIA) - which oversees the scheme - said the agency had started implementing the recommendations of a June 2017 Independent Pricing Review.
"The NDIA takes its responsibility for price setting seriously and has established a Pricing Reference Group, which includes two independent members," the spokesperson said.
"The Pricing Reference Group demonstrates the NDIA's commitment to a rigorous and transparent approach to continuous improvement of the NDIS price control arrangements."
The agency was also rolling out training to improve support to planning staff, as well as a series of improvements for providers including IT enhancements.
"The NDIA is progressively rolling out a number of changes across the country to improve people's individual journeys with the NDIS," the spokesperson said.
Meantime the NDIS Quality and Safeguards Commission had been operating in NSW, and SA, since July 1, 2018.
"The NDIS Commission is a new independent agency established to improve the quality and safety of NDIS supports and services," the spokesperson said.
"The NDIS Commission will be progressively rolled out to other states and territories, and work with NDIS participants, service providers, workers and the community to introduce a new nationally consistent approach."