By Joe Paradza  —  Allied Health leader & NDIS Industry Analyst

Published: 25 March 2026

Rising living costs across Australia are directly impacting access to essential healthcare services, with providers and patients reporting growing financial pressure in 2026. From delayed therapy appointments to reduced service hours, the cost-of-living crisis is reshaping who can access care with NDIS participants, low-income households, and regional communities bearing the greatest burden.

Australia’s healthcare system is contending with a convergence of economic pressures. Out-of-pocket healthcare costs now exceed $8 billion annually, according to a report by Mandala Partners and Private Healthcare Australia, with costs surging 12 per cent in the past year alone. Three in four Australians, 76 per cent are now changing their healthcare decisions due to financial pressures, according to the 2025 Australian Healthcare Index. Nearly half have delayed seeking mental health support, while one in five is delaying or avoiding medical treatment altogether.

For NDIS participants, the picture is equally concerning. While the 2025–26 NDIS Pricing Arrangements introduced a 3.95 per cent increase in standard support prices, providers report this has not kept pace with the real cost of delivering services. Fuel, insurance, and staff wages continue to rise, squeezing margins and limiting the number of clients who can be seen.

Allied health and disability service providers are facing a structural affordability challenge. The costs of delivering care particularly in mobile and community-based settings have increased significantly, while revenue growth has remained constrained by regulated price limits.

Key cost pressures include rising travel expenses for mobile practitioners, higher wages following Fair Work Commission decisions, and growing compliance costs. For NDIS providers, the 2025–26 pricing framework removed differential pricing for therapy supports across states and territories, resulting in pricing reductions in some remote areas precisely the regions where delivery costs are highest.

The disability support workforce continues to experience high turnover, with 17 to 25 per cent of support workers leaving their roles each year, according to the NDIS Review. Smaller providers, particularly sole practitioners and regional practices, are absorbing costs that cannot be passed on some are reducing service areas or withdrawing from remote delivery entirely.

For the people who rely on these services, the consequences are immediate. Reduced provider availability translates into longer wait times, fewer sessions, and in some cases, complete loss of access to therapy or support.

Regional and remote communities are bearing the greatest burden. Research in the Australian Journal of Rural Health found that small rural towns have only 36 per cent of the allied health workforce per capita compared to metropolitan areas. These existing shortages are being compounded by economic pressures driving providers away from areas where delivery costs outstrip what can be claimed.

NDIS participants in regional areas are reporting longer gaps between therapy sessions, difficulty finding providers willing to travel, and underutilisation of plan funding—not through lack of need, but through lack of available services. For children requiring early intervention, these delays carry long-term developmental implications. Women are also disproportionately affected, with 62 per cent delaying dental treatment and 32 per cent delaying mental health support, according to the 2025 Australian Healthcare Index.

The weight of evidence is consistent. According to Mandala Partners, without reform, Australians could face an additional $1.6 billion in out-of-pocket healthcare costs each year by 2030, pushing total consumer contributions to nearly $10 billion annually.

In the disability sector, the NDIS now supports approximately 751,000 participants as of early 2026, a figure that continues to grow. Yet providers report that workforce supply is not keeping pace with demand. National Disability Services data indicates that the permanent employment rate for allied health workers in the disability sector fell from 83 to 78 per cent, reflecting growing instability in the workforce pipeline.

Australia’s broader health workforce remains fragmented. Despite 121 federal health workforce policies in place, there is no overarching national strategy and the allied health workforce strategy covering physiotherapists, occupational therapists, and speech therapists is still under development.

From a provider perspective, the challenge is no longer about willingness to deliver care it is about viability. Allied health professionals and NDIS providers entered the sector to improve outcomes for vulnerable Australians. That commitment has not changed. What has changed is the economic environment in which care must be delivered.

Providers are now making trade-offs that would have been unthinkable five years ago: reducing travel to outlying areas, capping client numbers, and in some cases exiting the NDIS market entirely. The 2025–26 pricing framework’s removal of remote area loadings justified as supporting a shift to virtual service delivery has left many providers in remote areas questioning how they can remain sustainable.

If experienced providers leave the market, the capacity to deliver complex supports diminishes. Rebuilding that capacity takes years of workforce development and investment time that participants waiting for services do not have.

Without meaningful intervention, rising costs will continue to erode the affordability and accessibility of healthcare for vulnerable Australians. Provider margins will tighten further, particularly in regional and remote areas, leading to service gaps that disproportionately affect those with the greatest need.

The federal government’s expansion of bulk billing incentives and Medicare Urgent Care Clinics is a step toward addressing primary care affordability. However, these measures do not directly address the structural challenges facing allied health, disability services, and therapy providers sectors where the gap between cost and funding is widening.

Policy action is needed on several fronts: ensuring NDIS pricing reflects the true cost of service delivery in high-cost areas, accelerating a national allied health workforce strategy, and creating sustainable funding pathways that do not force providers to choose between viability and participant outcomes. The NDIA’s Annual Pricing Review consultation closed in February 2026, with recommendations expected soon. Its outcome will signal whether the system is moving toward sustainability or further away from it.

Australia’s healthcare system is at an inflection point. The cost-of-living crisis is not a temporary disruption it is reshaping the economics of care delivery in ways that will have lasting consequences for providers, participants, and the broader community.

The evidence confirms that vulnerable Australians are losing access to care. The question now is whether policymakers and the sector can act with sufficient urgency to prevent a structural decline that will take far longer to reverse than it took to create.

Recommended article: https://www.therapyinsights.com.au/p/ndis-provider-collapse-united-employment-owes-6-million-in-unpaid-wages-and-super