This chapter primarily deals with term of reference (a) the eligibility
criteria for the NDIS for people with a psychosocial disability.
The first part of the chapter focuses on the key issues relating to eligibility
criteria, including: the lack of clarity of criteria and guidelines; the criterion
of 'permanent impairment' in the context of psychosocial disability; and the reliance
on a diagnosis approach.
The second part of the chapter discusses participation and eligibility rates
and touches on the repercussions for people deemed not eligible for NDIS
services, which will be discussed in detail in Chapter 4.
Current legislation, rules and
guidelines regarding the disability requirements
Section 24 of the NDIS Act 2013 stipulates the disability
- A person meets the disability requirements if:
- the person has a disability that is
attributable to one or more intellectual, cognitive, neurological, sensory or
physical impairments or to one or more impairments attributable to a
psychiatric condition; and
- the impairment or impairments are,
or are likely to be, permanent; and
- the impairment or impairments
result in substantially reduced functional capacity to undertake, or
psychosocial functioning in undertaking, one or more of the following
- social interaction;
- self‑management; and
- the impairment or impairments
affect the person's capacity for social or economic participation; and
- the person is likely to require
support under the National Disability Insurance Scheme for the person's
- For the purposes of subsection (1), an impairment
or impairments that vary in intensity may be permanent, and the person is
likely to require support under the National Disability Insurance Scheme for
the person's lifetime, despite the variation.
The National Disability Insurance Scheme (Becoming a Participant)
Rules 2016 about the disability requirements state:
5.4 An impairment is, or is likely to be, permanent (see
paragraph 5.1(b)) only if there are no known, available and appropriate
evidence-based clinical, medical or other treatments that would be likely to
remedy the impairment.
5.5 An impairment may be permanent notwithstanding that the
severity of its impact on the functional capacity of the person may fluctuate
or there are prospects that the severity of the impact of the impairment on the
person's functional capacity, including their psychosocial functioning, may
5.6 An impairment may require medical treatment and review
before a determination can be made about whether the impairment is permanent or
likely to be permanent. The impairment is, or is likely to be, permanent only
if the impairment does not require further medical treatment or review in order
for its permanency or likely permanency to be demonstrated (even though the impairment
may continue to be treated and reviewed after this has been demonstrated).
The NDIS website provides the following details:
You may meet the disability requirements if:
you have an impairment or condition that is likely to be
permanent (i.e. it is likely to be lifelong) and
your impairment substantially reduces your ability to
participate effectively in activities, or perform tasks or actions unless you
- assistance from other people or
- you have assistive technology or equipment (other than
common items such as glasses) or
- you can't participate effectively even with assistance
or aides and equipment and
- your impairment affects your capacity for social and
economic participation and
- you are likely to require support under the NDIS for your lifetime.
An impairment that varies in intensity e.g. because the
impairment is of a chronic episodic nature may still be permanent, and you may
require support under the NDIS for your lifetime, despite the variation.
In its submission to this enquiry, the NDIA described the evidence
required to meet the disability requirements:
Most potential participants with a psychosocial disability
will be asked to provide evidence that they have or are likely to have a
permanent disability relating to their mental health condition. This needs to
be documented by a health professional and in the case of psychosocial disability;
this is usually a treating general practitioner or treating psychiatrist. The
NDIA will also need evidence/assessments to describe the extent of the
functional impact of the mental health condition on the person's everyday
Clarity of criteria
The vast majority of inquiry participants expressed concerns about the
lack of clear eligibility criteria for access to NDIS services for people with
a psychosocial disability.
Participants found the disability requirements provided in the NDIS Act
difficult to interpret when they are applied to a psychosocial disability
related to a mental health condition. The Office of the Public Advocate
(Victoria) said in its submission:
Notions that are particularly abstract in this context are
those of 'permanency' and 'functional impact', which the National Disability
Insurance Agency (NDIA) does not further qualify.
Mental Health Australia, the peak, national non-government organisation
representing the interests of the Australian mental health sector states:
Clarification of the eligibility criteria for the NDIS re
psychosocial disability (currently accepted prevalence figure is 64,000 people
at Full Scheme) is the essential starting point. This was made clear in the
National Mental Health Commission's (NMHC) Review, which recommended that
government 'urgently clarify the eligibility criteria for access to the NDIS'
The Australian Government response to NMHC recommendation 3 reads:
The National Disability Insurance Scheme (NDIS) represents a
major advance in terms of funding available for disability support and in terms
of giving people with disability the power to choose what works best for them.
This includes people who gain entry to the Scheme due to disability arising from
The National Disability Insurance Agency (NDIA), Commonwealth
and state governments are working together with consumers, carers and peak
organisations on a significant work programme to underpin transition
arrangements, and to ensure implementation of the NDIS reflects the needs of
people with mental illness, their families and carers. The primary mechanism
for this work is the NDIA Mental Health Sector Reference Group.
In 2014, the Independent Advisory Council to the NDIA (IAC) identified
the need for 'a more informed evidence base to assist in addressing the complex
issues involved in implementing the intent of the NDIS Act in regard to the
assessment of eligibility'.
At the time, the IAC noted that there were no accepted criteria for the
determination of serious and persistent functional impairments in regards to
psychosocial disabilities. In the submission to this inquiry, the IAC reiterated
a number of recommendations it had made in 2014, including:
The Agency develops its own working definition and guidelines
of permanency of disabilities related to mental health issues.
Permanent impairment requirement
Best-practice mental health care emphasises the language of empowerment,
recovery and ability over that of disability, impairment
and illness. Inquiry participants were concerned that the language used
in the NDIS Act does not fit with the recovery oriented approach of the mental
In particular, inquiry participants found the requirement for a person
to have an impairment that is permanent or likely to be permanent difficult to
reconcile with contemporary, recovery-focussed mental health management and
The committee heard on numerous occasions
that some people declined to engage with the NDIS because of the permanent disability
requirement and definition of mental illness disability. Tandem, the Victorian
peak body representing families and carers of people living with mental health
challenges or a psychosocial disability explains:
A reliance on the language of permanence as a requirement to
access the Scheme creates barriers for people. Tandem has heard numerous
anecdotes from family and carers of the person that they care for declining to
engage with the NDIS because they do not view their situation as a 'psychosocial
disability 'that is 'permanent'.
Orygen, the National Centre of Excellence in Youth Mental Health, raised
the issue of the difficulty for young people with a psychiatric disability to
enter the NDIS because they are likely not to receive a diagnosis of permanent
Even for young people experiencing severe and functionally
disabling mental ill-health, current NDIS eligibility criteria would exclude
access on the basis that it would not be possible (or clinically advisable) to
diagnose the illness as a 'permanent' condition. It is therefore problematic
that this term is used to define eligibility for the NDIS.
The Commonwealth Ombudsman also reported receiving 'feedback that
suggests a barrier to accessing the Scheme, especially for young people with
psychosocial disability, is that medical professionals may be reluctant to
assess the person's condition as permanent or likely to be permanent'.
Similarly, Anglicare Tasmania Inc. raised concerns about the permanent
impairment requirement for young people:
Professionals are often reluctant to both diagnose and label
symptoms as a specific illness and to confidently state that this is a
permanent condition. Many young people living with mental health conditions are
likely to be reluctant to consider that their condition is permanent, given the
recovery model's emphasis on positive improvements.
At a public hearing, Professor McGorry, Executive Director, Orygen,
A very important thing in psychiatry is early intervention
and recovery—they have been the two big things in the last 20 or 30 years—and
changing the pessimism that used to be associated with these illnesses. To have
a model that assumes and requires permanent and fixed disability does not
really work for us; certainly not in youth mental health. This is what young
people have told us.
Amendments to legislation and rules
The committee heard on a number of occasions
that amendments to the NDIS Act 2013 in relation to the 'permanent'
requirement criterion would enable NDIS to have a recovery-oriented approach
aligned with its objectives of maximising independence, social and economic
participation at the individual level.
Dr Sarah Pollock, Executive Director, Research and Advocacy, Mind
Our view is that there does need to be some change made to
the act. One way of dealing with that would be to reference permanency if appropriate
support is not received, so that permanency or recovery becomes contingent on
the person being able to get support—so that it says that impairment will be
permanent if support is not accessible.
Proposed amendments to the NDIS Act in relation to the 'permanent'
Replacing the word permanent with ongoing, enduring or
Considering incorporating into Section 24.1(b): the impairment
or impairments are ongoing, or likely to be ongoing without the person
receiving supports intended to build their capacity.
The committee also received recommendations to amend the National
Disability Insurance Scheme (Becoming a Participant) Rules 2016 to, a) include
the principle of recovery-oriented practice for psychosocial disability; and b)
clarify that Rule 5.4 does not apply to psychosocial disability to reflect that
people with mental illness will receive ongoing clinical, medical and other
treatments and psychosocial services to aid their recovery.
In contrast, the committee also heard that the NDIS Act has
sufficient flexibility. Mary Burgess, Public Advocate (QLD) cited Section 24
(2) that allows for variability within the concept of permanency. In her view, 'the
critical issue for people with psychosocial disability in relation to
determining eligibility for the NDIS in accordance with the Act, is that of
assessing functionality and capacity to participate in Australian society over
the long term (Section 24 (1) (c) and (d))'.
Reliance on formal diagnosis
In the context of psychosocial disability, assessing and predicting
functionality over the long term is complex and difficult. Some submitters
suggested that this has led to a practice of heavy reliance and focus on a formal
diagnosis rather than functionality and the need for support to determine
Mary Burgess, Public Advocate of Queensland, stated:
We are also aware that eligibility decisions made by the NDIA
staff are often heavily reliant on diagnosis rather than functionality and the
need for support.
The committee heard that another contributing factor leading to the
diagnosis type approach to determine eligibility is the reference to 'psychiatric
condition' in Section 24 of the NDIS Act. Psychiatric condition is the
causal component of later psychosocial disability.
According to Mind Australia, no other forms of disability are related to a
cause in Section 24 of the NDIS Act.
Peak organisations such as Mental Health Australia, Mental Illness Fellowship
of Australia Inc. and CMHA recommend removing references to psychiatric
condition in the NDIS Act.
Aftercare, which currently services more than 6 000 clients across NSW,
QLD and VIC, argues that the focus on diagnosis disqualifies some people with
demonstrable needs under the NDIS:
Our consistent experience over the full period of the
operation of the Scheme to date is that the eligibility criteria do not
adequately consider the episodic nature of psychiatric disability/mental
illness, and the focus on diagnosis rather than physical and psychosocial
impact disqualifies many with a demonstrable need for assistance under the Scheme.
talked about the episodic nature of conditions and symptoms associated with
psychosocial disabilities and how this may exclude people from the Scheme
despite their ongoing need for support.
Anglicare Australia highlighted issues expressed by many participants:
In particular the requirement for a psychosocial disability
to be both severe and permanent significantly narrows eligibility, contradicts
the known episodic nature of many severe forms of mental illness, and directly
challenges a recovery framework for treatment.
Mind Australia Limited explained the limitations of reliance on
Current practice in assessment of eligibility for people with
mental illness relies heavily on diagnosis and evidence from GPs and
psychiatrists. As a means of determining disability, this is a blunt instrument
because it fails to take into account the complex interplay between symptom
severity and individual context over time – including the cumulative impact of
episodes of illness on a person's broader life and ability to participate
socially and economically.
As described by Ms Burgess, the Public Advocate of Queensland, the
reliance on diagnosis can also lead to inconsistencies and disadvantage
individuals with less acknowledged conditions:
So, in Queensland, we are seeing people with a diagnosis for
schizophrenia or depression being more likely to receive NDIS funding than
those with less acknowledged conditions such as post-traumatic stress disorder
or personality disorders, without consideration of the impacts of these
conditions on their functionality.
This is confirmed by consumers' groups such as Mental Health and NDIS
Facebook Support Group, which has reported instances where applicants have been
deemed not eligible to the NDIS solely because their conditions are not on the
list of acceptable disabilities and are a medical condition.
found that the emphasis should be on the assessment of functional impairments
and needs to determine eligibility. Whilst many areas of disability do have
accepted criteria for the determination of serious and persistent functional
impairments, such criteria have not yet been developed in regard to
psychosocial disabilities related to a mental health condition.
The IAC and others recommended that the NDIA develop a validated
instrument to determine functional impairments and support needs for people
with psychosocial disability related to a mental health condition.
The estimated number of Australians with severe mental illness requiring
community support varies but is, in any case well over 200 000. The Australian Government
has estimated that 230 000 Australians with severe mental illness have a need
for some form of social support, ranging from low intensity or group-based
activities delivered through mainstream social services to extensive and
individualised disability support.
Using NMHSPF modelling, it is estimated that approximately 290 000
Australians with severe mental illness require community support.
As discussed in Chapter 1, in 2019–2020, it is estimated that around 64
000 people with a primary psychosocial disability will be participants in the
At the end of March 2017, 4849 people with a psychosocial disability had
approved plans, accounting for six per cent of Scheme participants.
To date, eligibility rates for NDIS applicants with a psychosocial
disability have been one of the lowest compared to other broad disability
categories. Over the life of the Scheme, 81.4 per cent of people with
psychosocial disability who lodged an access request have been found eligible
for the Scheme. This compares to 97.5 per cent for people with intellectual
disability; 98.8 per cent for people with autism and 98.9 per cent for people
with cerebral palsy.
In 2016–2017, the approval rate for people with psychosocial disability
has fallen during the first and second quarter (data not available for third
quarter) with only 69.4 per cent approved during Quarter 1,
and 71.3 per cent during Quarter 2.
A number of submitters suggested the need for a review into the
eligibility rates for NDIS applicants with a psychosocial disability to
investigate the high rejection rate of applications for this client group in
comparison with applications from people with other primary disabilities.
The IAC recommended:
That the Agency monitor patterns of eligibility and ineligibility
in relation to functional impairment and a psychiatric condition to build a
picture of who is being included and excluded, track compliance with the
requirements of the legislation and the consistency of the assessments being
Impact on people deemed not eligible for NDIS services
One of the key issues for people deemed not eligible for NDIS services is
what services will be available once some of the existing Commonwealth, state
and territory funded services have fully transitioned into the NDIS.
Currently, to access continuity of support, clients of Commonwealth
programs transitioning to the NDIS need to apply for the NDIS, regardless
whether or not they are obviously ineligible for the NDIS.
This is especially important given that service providers have reported that,
to date; only some of their existing clients are applying for the NDIS.
This may result in some existing clients losing supports and left without
The ILC, formerly known as Tier 2, is the component of the NDIS that
provides information, linkages and referral to efficiently connect people with
disability, their families and carers, with appropriate disability, community
and mainstream supports.
As described by the Sunshine Coast and Gympie – Partners in Recovery, 'the
ILC component has been branded as the answer to ensuring continuity of support
for those who be ineligible for an IFP'.
However, there are concerns that the ILC does not have the capacity to
provide for what existing services deliver or respond to the needs of people
who won't be eligible for the NDIS.
For example, the National Mental Health Commission is 'concerned that
the ILC as currently envisaged will not be adequately funded to address the
level of need, especially among those with psychosocial disability who do not
qualify for a package under the NDIS'.
Mental Health Coordinating Council noted that there is no quarantined
ILC mental health specific allocation and added 'if there were, it would not
come close to replacing the Commonwealth mental health programs that are
scheduled to be lost to the NDIS.'
The scope and level of funding for mental health services under the ILC
framework are discussed in Chapter 4.
The RACP expressed concerns that any reduction in services available to
people deemed ineligible for the NDIS will likely result in increased pressure
and demand upon the mental healthcare system.
The issues relating to the transition of services to the NDIS, the
interface between the NDIS and services outside the Scheme as well as emerging
service gaps for people not eligible for NDIS services are explored and
discussed in Chapter 4.
The committee acknowledges the widespread concerns expressed by
stakeholders in relation to the lack of clarity of the eligibility criteria
when applied to psychosocial disabilities related to a mental health condition.
The committee agrees that the language of disability used in the NDIS
Act and NDIS (Becoming a Participant) Rules does not readily translate into the
mental health sphere. An example is the language of permanence which, while a
core eligibility criteria for access to the NDIS, can on the surface at least,
appear to conflict with a recovery approach, which is the guiding vision and
value base for contemporary practice in mental health. Additionally, the
committee notes that the language of permanence and disability may detract some
people in needs of ongoing support, including young people, to actually engage
with the NDIS.
The committee agrees that Rule 5.4 in the National Disability
Insurance Scheme (Becoming a Participant) Rules 2016 should not apply to
psychosocial disability to reflect that people with a mental health condition
receive ongoing clinical, medical and other treatments and psychosocial
services to aid their recovery.
The focus on recovery is particularly important for young people
experiencing mental ill-health. Organisations supporting young people have long
advocated the need for early-intervention for young people with conditions that
will be diagnosed as being permanent. While changes to the permanency criteria
in the NDIS Rules may assist participants of NDIS, there is still a significant
need for adequate tailored support as early as possible for those young people
who will not access the Scheme.
Reliance on formal diagnosis
The reference to psychiatric condition in Section 24(1) (a) may blur the
assessment process for eligibility and lead to a heavy reliance on diagnosis
instead of functional needs. Overall, the committee is concerned that, in the
context of psychosocial disability, the ambiguity of the language combined with
a lack of appropriate tools to assess eligibility could lead to inconsistent
interpretations of the NDIS Act and result in inconsistent eligibility outcomes
At operational levels, the adoption of a fit-for-purpose assessment tool
to assess the eligibility of people with psychosocial disability would ensure
fair and consistent eligibility outcomes.
Review of the Act
In July 2015, the Australian Government commissioned Ernst & Young
to conduct an independent review of the NDIS Act.
COAG considered the review's recommendations and developed a response, which
was agreed in December 2016. COAG agreed with recommendation 31 to conduct a
further review of the NDIS Act in two-to-three years.
The committee recommends a review of the NDIS Act as early as possible to
provide greater clarity to eligibility criteria and better alignment with the
core principles of the NDIS.
The committee is concerned with the relatively high rejection rate of
applications for people with a psychosocial disability in comparison with
applications from people with other primary disabilities. The committee
believes there is value in investigating why ineligibility rates are
significantly higher for people with psychosocial disability as the reasons
Requirement to apply for the NDIS
to access continuity of support for existing program clients
Evidence received by the committee strongly suggests that not all
existing clients of Commonwealth programs such as Partners in Recovery (PIR), Personal
Helpers and Mentors (PHaMs) and Day to Day Living (D2DL), which are
transitioning into the NDIS, will apply for the NDIS. Those currently receiving
support under the Mental Health Respite: Carer Support (MHR:CS) could also be
impacted. The committee is concerned that the current requirement for existing
clients of these programs to apply for the NDIS to be able to access continuity
of support may have some detrimental consequences. It is likely to result in
some existing clients losing psychosocial supports, which would further
marginalise a cohort of people who are hard-to-reach and had very little or no
interaction with existing services prior becoming clients to these specific
The committee recommends that the NDIS Act is reviewed to assess
the permanency provisions in Section 24 (1) (b) and the appropriateness of the
reference to 'psychiatric condition' in 24 (1) (a).
The committee recommends that a review of the NDIS (Becoming a
Participant) Rules 2016 should be considered to assess the appropriateness and
- Including the principle of recovery-oriented practice
for psychosocial disability, and
- Clarifying that Rule 5.4 which dictates that a
condition is, or is likely to be permanent,
does not apply to psychosocial disability, to reflect that people with mental
conditions will receive ongoing treatments to aid recovery.
The committee recommends that the Australian Government ensures young
people with mental ill-health who are not participants of the Scheme, have
access to adequate early intervention services.
The committee recommends the NDIA, in conjunction with the mental health
sector, develops and adopts a validated fit-for-purpose assessment tool to
assess the eligibility of people with psychosocial disability that focuses on
their functional capacity for social and economic participation.
The committee recommends the NDIA monitors eligibility rates for people
with psychosocial disability to, a) understand the reasons for a higher
rejection rate compared to other disabilities; and b) to build a clearer
picture of the size and needs of the people who have been found ineligible for
The committee recommends clients currently receiving mental
health services, including services under Commonwealth programs transitioning
to the NDIS, namely Partners in Recovery (PIR), Personal Helpers and Mentors
(PHaMs), Day to Day Living (D2DL, and Mental Health Respite: Carer Support
(MHR:CS), should not have to apply for the NDIS to have guarantee of continuity
of supports and access services.
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