Brace for Impact - Why the 2025-26 NDIS Unit Price Will Hit ~ $70.24/hr and Why It Still Won't Save Your Margins

Providers across the NDIS sector have become reluctantly accustomed to an annual cycle of pricing uncertainty and incremental adjustments. However, the upcoming 2025-26 financial year presents an especially unsettling milestone: the forecasted unit price for entry-level Disability Support Work (DSW 1 or DSW A), aligned with SCHADS Level 2.3 (SAC stream), is expected to rise to approximately $70.24 per hour.

Our comprehensive analysis strongly suggests that the NDIA will apply a consistent set of Disability Cost Model (DCM) multipliers to the underlying award wage structure. When these component-based multipliers are applied to the projected base rate of $36.75/hr, they collectively yield an effective unit price of $70.24/hr - representing an implied aggregate multiplier of approximately 91.11%. On the surface, this modest rise from last year's $67.56/hr may seem reassuring, yet beneath this incremental increase lies a deeper, more problematic reality.

A Brief Timeline of Price Adjustments: Key Market Corrections

To understand the context, let's briefly revisit key events that have shaped today's financial landscape:

• 2020: COVID-19 impacts and subsequent NDIA price adjustments abruptly disrupted provider finances.
• July 2020: SCHADS wage increase of 7.06% significantly compressed provider margins.
• May 2022: Election of the Labor government and appointment of Bill Shorten as NDIS Minister directed policy reforms and further wage hikes.
• Dec 2023: NDIS Review Final Report introduced foundational supports and intense pricing scrutiny.
• July 2024: Wage rise of 3.75% and superannuation increase of 0.5%, absorbed directly by providers.
• July 2025: Confirmed wage increase of 3.5% plus another superannuation increment of 0.5%, ensuring additional financial strain for providers.

Each event incrementally compounded financial pressures, culminating in the precarious pricing environment we face today.

Dissecting the Multiplier – Year-on-Year Uplift Trends

The annual multiplier trends clearly illustrate how incremental base rate adjustments translate into unit price changes, underpinning our forecast:

Our forecasted $70.24/hr reflects 7 years of NDIA uplifts trailing real cost pressures.

These year-over-year variations highlight the NDIA's approach in adjusting pricing and reveal the underlying strategic direction towards minimal incremental growth, which compounds financial pressures for providers.

Our Prediction: The Unit Price for FY 2025-26 Will Be $70.24

Our rigorous forecasting, informed by historical patterns, economic conditions, and governmental policy direction, confidently predicts the FY 2025-26 unit price will land at approximately $70.24/hr. This assumes the NDIA maintains its historically consistent cost component multipliers within the DCM, which when applied to SACs 2.3 results in an aggregate effective multiplier of approximately 91.11%.

Here's our detailed cost breakdown:

Detailed cost breakdown behind our $70.24/hr NDIS unit price prediction for FY2025–26.

This projection is grounded in thorough modelling and careful evaluation of prevailing market dynamics and policy trends.

Cost-Based Analysis for FY 2025-26 and Critical Observations and Conclusions:

If the NDIA continues using its established pricing methodology:

Providers must confront the imminent reality that $70.24/hr, despite appearing stable, conceals profound vulnerabilities. The clear strategic imperative for FY 2025-26 is aggressive overhead management - particularly transitioning core corporate functions to more flexible, outsourced models.

In short, the upcoming price point isn't just a modest adjustment; it's a clarion call for decisive operational restructuring and cost control to preserve viability and margins in a challenging fiscal landscape.

The Growing Disparity – The Margin Mirage

$14.71/hr price rise, just $0.29/hr margin gain - The NDIS's margin mirage

Here we confront a deeply uncomfortable truth: From FY2019-20 to FY2024-25, the unit price increased by $14.71/hr - a seemingly robust 27.83% rise. Yet, provider margins only increased by a nominal $0.29/hr. Although this also calculates to a 27.83% margin increase on paper, it is critically misleading.

The stark reality is this increase represents a "mirage margin," reflecting minimum-cost scenarios rarely achievable in operational reality. Each additional dollar predominantly funds rising regulatory, compliance, operational overhead, and wage pressures, rather than enhancing profitability or long-term viability.

Implications for Support Coordination & Therapy Pricing

Providers have experienced five consecutive years without any price increases for Therapy and Support Coordination services. Given NDIA's ongoing commitment to a stringent 8% overall growth cap and its shift toward foundational supports, significant price uplifts for these services remain highly unlikely. From July 2025, the temporary measure allowing therapeutic supports to be funded through core supports will expire, further reducing participants' purchasing power specifically for therapy services.

At the same time, providers continue to face significant staffing challenges - with vacancy rates approaching one-third in some regions - driving wage pressures even higher. Providers must therefore strategically reassess their operational models: focusing on just two viable levers: outsourcing administrative and corporate overheads, and transitioning to subcontractor models. These remain the only proven strategies to preserve the sustainability and viability of therapy businesses in the current and forecasted funding environment.

In short, providers must proactively adapt, as the NDIA is unlikely to deliver the pricing relief required to offset escalating costs. Those who restructure effectively now will maintain viability, while those waiting on policy-driven relief risk severe margin erosion or may face existential threat.