Thousands of small allied health businesses risk becoming an overlooked casualty of major changes to the NDIS and the rollout of Thriving Kids, the Council of Small Business Organisations Australia (COSBOA) and Allied Health Professions Australia (AHPA) have warned.
The organisations say the consequences for established small allied health businesses must be addressed as the reforms are implemented and are calling for government support to strengthen business resilience in the sector and help providers navigate the transition.
Many occupational therapists, speech pathologists, physiotherapists, psychologists and other allied health professionals established private practices as the NDIS expanded, investing in premises, employing clinicians and building businesses around the new system.
As participants move out of the NDIS and new Thriving Kids service models are established, COSBOA CEO Skye Cappuccio said the challenges facing these small businesses and the communities they serve must be dealt with.
“These aren’t faceless providers. They are small business owners who have spent years building practices, employing people and investing in their communities,” Ms Cappuccio said.
“Many built their businesses in response to the system created by governments. Now that system is changing substantially and some are facing another major restructure through no failure of their own.”
AHPA CEO Bronwyn Morris-Donovan said the organisation has long shared COSBOA’s concerns about how allied health businesses would navigate the reforms.
“We absolutely support the goal of a sustainable disability support system where Australians who need allied health support can access the right services when they need them,” Ms Morris-Donovan said.
“We have been calling on governments to provide a clear plan for the allied health workforce and small businesses affected by these changes, including practical measures that support the sector to remain resilient throughout the transition.
“Allied health providers are critical to delivering essential health and disability services across Australia, and many small practices operate across multiple government programs and funding streams, including the NDIS.”
COSBOA and AHPA are asking the Government to provide targeted transition support for affected businesses, including clear information and guidance, business resilience tools and assistance for businesses required to restructure as a result of the reforms.
“There are existing government programs designed to help businesses respond to disruption and major structural change. Allied health businesses affected by these reforms should be actively connected with appropriate advice, tools and support rather than being left to navigate the transition alone,” Ms Cappuccio said.
The organisations are also calling for governments to undertake research to understand which businesses and communities are most at risk and to ensure small and private providers are considered in the development of Thriving Kids commissioning models.
“This research would give Government the information it needs to realistically assess where displaced allied health professionals could work, we cannot just assume businesses and clinicians can simply move straight into other sectors such as aged care,” AHPA Chief Executive Officer Bronwyn Morris-Donovan said.
Recent ASIC insolvency data highlight the growing pressure across the health care and social assistance sector. Companies entering external administration for the first time rose from 160 in 2022-23 to 481 in 2024-25, an increase of around 200 per cent and the largest rise of any industry division.
The increase was even more pronounced in some service areas. First-time insolvency appointments among allied health providers rose from 17 to 68 over the same period, an increase of 300 per cent, while other social assistance services rose from 18 to 126, an increase of 600 per cent[i].
Around 90 per cent of occupational therapists are women, as are the majority of speech pathologists and psychologists working in disciplines central to paediatric early intervention.
Ms Morris-Donovan said maintaining viable allied health businesses was particularly important outside of major cities.
“We are particularly concerned about the disruptive impacts of the reform in regional and remote communities, where one practice may provide services across disability, paediatric care, aged care and other areas and where replacing lost allied health capacity is already difficult,” Ms Morris-Donovan said.
Ms Cappuccio said small business considerations needed to be built into implementation decisions as governments moved ahead with the reforms.
“Governments still have choices about how this transition is managed,” Ms Cappuccio said.
“Private providers need a genuine place in the development of new service models, with practical support available for businesses that need to restructure.
“Small businesses shouldn’t become collateral damage from reform because nobody stopped to consider what would happen to them.”
