NDIS Changes 2025 – 26 – What They Mean for Your OT Funding

Reading time: 10 minutes  |  Updated: April 2026  |  Written by: TEAH Allied Health Team

The 2025–26 NDIS pricing year brought significant changes that are directly affecting how participants access occupational therapy across Australia. A continued price freeze on OT rates, a 50% cut to travel reimbursements, new Improved Daily Living budget rules, and changes flowing from the NDIS legislative reforms have created a landscape that is genuinely harder to navigate, particularly for participants in regional and remote areas, and for those who rely on in-home or mobile OT services.

This article explains what has actually changed, what it means for your OT funding and access, and what you can do to protect your entitlements at your next plan review. It is written in plain language for participants, families, and support coordinators, not for policy analysts.

The OT Rate Freeze – Seven Years Unchanged

The NDIS Pricing Arrangements and Price Limits (PAPL) sets the maximum hourly rate that registered OT providers can charge agency-managed participants. For the 2025–26 pricing year, the weekday rate for occupational therapy remained at $193.99 per hour – unchanged since 2019.

Seven years without a rate increase, against cumulative inflation of more than 25% since 2019, means the real value of every OT hour billed has eroded substantially. Occupational Therapy Australia’s 2025 provider survey, which canvassed more than 600 OT businesses, found that 55% failed to make a profit in the past financial year. Fourteen per cent of NDIS-registered OT businesses were already planning to close, and a further 50% were actively considering exiting the sector within three years.

For participants, this matters because it translates directly into reduced OT supply, longer wait times, fewer available providers, and reduced capacity for rural and remote outreach. The rate freeze is not an abstract policy matter; it is the mechanism by which some participants are now unable to find an OT at all.

Travel Reimbursement Cuts – How They Affect Home Visits

The single most significant operational change for OT service delivery in 2025–26 was the halving of OT travel reimbursement rates. From 1 July 2025, the maximum travel time labour cost that OT providers can claim was reduced to 50% of the direct service hourly rate – meaning an OT can only claim $96.99 per hour for travel time (down from $193.99).

The practical consequences of this change are significant and are already visible across the sector:

• Reduced home visit availability – for providers whose business model is built on mobile, in-home service delivery, the economics of home visits have become significantly less viable, particularly for participants who live 30–60 minutes from the OT’s base
• Geographic contraction – OT providers are pulling back from areas they previously serviced. Participants in outer suburbs, regional centres, and rural areas are disproportionately affected
• Shift to clinic-based delivery – some providers are responding by shifting participants from in-home to clinic-based appointments, which, as discussed elsewhere on this site, is clinically inferior for most NDIS assessment purposes
• Regional and remote communities most affected – OTA’s 2025 survey found that 92% of providers had already cut back on travel and outreach. In regional NT, WA, and QLD, this translates directly into reduced access to OT in communities that already had limited provider presence

What it means for your OT appointments

If you have previously received in-home OT and are finding it harder to book, or if your provider has suggested moving to a clinic or telehealth model, the travel reimbursement cut is almost certainly a factor. Participants who need in-home assessment, for FCAs, home modification assessments, and SIL assessments, should raise this explicitly with their provider and support coordinator. The clinical case for in-home assessment is well-established, and the NDIA’s own guidance recognises that home visits produce more accurate functional evidence than clinic-based alternatives.

Provider Exits – What the Shrinking OT Market Means for You

The combination of the rate freeze and travel cuts is accelerating a trend that has been building for several years: OT providers exiting or reducing their NDIS participation. For participants, this translates into concrete consequences:

Wait times are growing

In metropolitan areas, FCA wait times that were 6 – 10 weeks two years ago are now frequently running at 12 – 20 weeks. In regional areas, where the provider pool was already thin, some participants are waiting 6+ months. For plan review purposes, where the FCA must arrive before the planning meeting, this requires even earlier referral than previously.

Fewer specialist providers

Specialist OTs,  those with deep expertise in SIL assessment, complex AT prescription, or specific condition areas, are disproportionately exiting the NDIS because the economics of specialist work (which requires more preparation, more specific assessment tools, and more complex report writing) are particularly strained at the current rate. Participants with complex needs are facing the most severe access reduction.

What this means for your referral timing

The practical implication is straightforward: if you need an OT assessment, refer earlier than you ever have. For plan review FCAs, the safe lead time is now 4 – 5 months rather than the 3 months previously recommended. For SIL assessments, which are the most complex and time-consuming, allow 6 months from referral to completed report. These are not bureaucratic buffers; they are the realistic timelines required given current market conditions.

Improved Daily Living Budget – What Changed in 2025 – 26

The Capacity Building – Improved Daily Living (IDL) budget is the source of NDIS funding for OT services. Several changes and clarifications in 2025–26 affect how this budget can be used:

IDL remains the correct funding source for OT

All OT services – assessments, therapy sessions, report writing, non-face-to-face time, and telehealth – continue to be funded from IDL at the $193.99 per hour weekday PAPL rate. This has not changed. Capital Supports remains the appropriate budget for AT items and home modifications following OT assessment.

Non-face-to-face billing – clarification for participants

OT providers can legitimately bill IDL for non-face-to-face time – report writing, case conferences, research related to a specific participant’s AT needs, and communication with treating teams. If you have been surprised by IDL charges for time when the OT was not physically with you, this is a legitimate NDIS billing category (not an error), provided the non-face-to-face work is clinically necessary and reasonable. Ask your OT to itemise what non-face-to-face time relates to if you have questions.

Telehealth billing remains available at full rate

Telehealth OT sessions – delivered via video call – are billable at the same rate as in-person sessions ($193.99/hr). This was confirmed in the 2025–26 PAPL and is particularly relevant for regional and remote participants. Telehealth supplements but does not fully replace in-home delivery for assessment purposes.

The “reasonable and necessary” scrutiny is increasing

Linked to the broader NDIS reforms (below), there is an increased focus on whether each IDL expenditure meets the “reasonable and necessary” criteria. OT reports produced as part of plan review submissions should explicitly connect each recommended support to the participant’s plan goals. OTs who produce reports that the NDIA considers to be recommending more than the evidence base supports are facing increased scrutiny – which is ultimately good for participants who want credible reports, but may affect some providers’ reporting practices.

NDIS Legislative Reforms – What Participants Need to Know

The National Disability Insurance Scheme Amendment (Getting the NDIS Back on Track No. 1) Act 2024 introduced the most significant legislative changes to the NDIS since its inception. These changes have been progressively implemented through 2025 – 26 and affect how plans are made and how funding decisions are applied.

New definition of NDIS support

The 2024 amendments introduced a new definition of what constitutes an NDIS support – distinguishing NDIS-funded disability supports from mainstream service responsibilities (health, education, housing). The intent is to clarify that the NDIS funds disability-related supports, not general health treatment or education system responsibilities.

For OT specifically, this clarification reinforces existing practice: OT services funded through IDL must be disability-related capacity building, not clinical healthcare. OT assessments and therapy that build functional capacity for daily living continue to be clearly within scope. Clinical health-type OT interventions – such as wound management or post-acute hospital rehabilitation – are considered health system responsibilities and should not be funded from IDL.

Strengthened “reasonable and necessary” criteria

The reforms have strengthened the legislative framework for “reasonable and necessary” decision-making. NDIA planners now have more explicit guidance requiring them to consider whether each support is both effective (evidence-based) and proportionate to the assessed need. Well-evidenced OT reports, with standardised assessment scores, task-level quantification, and goal alignment, are more important than ever as the basis for plan funding decisions.

More structured planning process

The amended Act introduces a more structured planning process, including the concept of a participant statement of goals and needs. OT assessments that directly reference and address a participant’s stated goals, rather than producing generic functional descriptions, are better positioned to influence plan outcomes under the reformed planning framework.

Protecting Your OT Funding at Plan Review

Given the changes in 2025–26, plan reviews are more consequential than ever. The combination of a more structured planning process, strengthened reasonable and necessary criteria, and a market with fewer available OT providers means that the quality of the OT evidence you submit at plan review directly determines your outcome.

Start the process earlier

Given current market wait times, refer for an OT assessment at least 4 – 5 months before your plan review date. If you are expecting a plan review in the second half of 2026, the time to act is now. Contact TEAH directly to discuss your timeline and we will advise what is achievable.

Ensure the FCA addresses the 2025 – 26 evidence standards

Under the reformed framework, a strong FCA must:

• Use named standardised assessment tools and report actual scores (not just narrative summaries)
• Quantify support needs by task, level, and frequency – not just describe them generally
• Explicitly connect every recommendation to a participant NDIS goal
• Address informal support arrangements and their sustainability
• Document variability – how functioning differs between good days and difficult days

Request a service agreement that covers draft report review

In a tightening market, some providers are producing faster but shallower reports to manage throughput. Ensure your service agreement specifies that a draft report will be provided for review before finalisation. Read it carefully – checking factual accuracy, ensuring your worst-day functioning is reflected, and confirming that the recommendations are specific enough to justify the support levels being requested.

Do not rely solely on an old OT report

Under the strengthened reasonable and necessary criteria, an FCA more than 18–24 months old carries significantly less evidential weight at plan review. If your most recent OT report predates July 2024, commission an updated assessment ahead of your next review – regardless of whether your condition appears stable.

Regional and Remote Participants – A Harder Road

The 2025 – 26 changes have hit regional and remote participants harder than anyone else, for a simple reason: travel reimbursement cuts disproportionately affect providers who were already travelling significant distances to reach communities with no local OT presence.

Across regional NT, the Kimberley, regional WA, and remote QLD, OTA’s 2025 survey found 92% of providers had reduced travel and outreach. In practical terms, this means communities that had irregular but functional OT access are now going longer between visits – or losing access altogether.

FIFO OT remains available and fundable

Fly-in fly-out OT assessments – where an OT travels to a remote community to conduct an in-home FCA, home modification assessment, or SIL assessment – remain fully fundable from IDL. Travel costs (flights, accommodation, vehicle) are billed separately from the assessment at reasonable commercial rates. If you are in a remote or regional area and your previous OT provider has reduced or ceased visits, contact TEAH to discuss what FIFO assessment arrangements can be made.

Telehealth supplements but cannot replace

For remote participants, telehealth OT can handle assessment components that do not require physical presence – intake interviews, standardised questionnaires administered with carer support, and ongoing coaching sessions. But for FCAs, home modification assessments, and SIL assessments, a physical visit remains clinically necessary. A hybrid model – telehealth for interview components, FIFO for the environmental assessment — is often the most practical approach in remote areas.

What TEAH Is Doing to Maintain Access

TEAH has made a deliberate decision to maintain in-home delivery as our standard approach — absorbing the operational impact of the travel reimbursement cut rather than shifting participants to a clinic model that would compromise the quality of our assessments.

We continue to offer:

• In-home FCA, home modification, AT, and SIL assessments across Darwin and the greater Darwin region, Perth metropolitan, Brisbane and South East Queensland, and Victoria
• Below-average wait times — maintained through active capacity management and intake team efficiency
• FIFO assessment capacity for regional NT, regional WA, and regional QLD participants where local OT access is limited or absent
• Draft report review as standard — every assessment includes a participant and coordinator review stage before finalisation
• Transparent fee structure — travel costs are disclosed at intake, not as surprise additions to the invoice

We are an NDIS-registered provider, accessible to agency-managed, plan-managed, and self-managed participants. Our OT rate is the 2025–26 PAPL of $193.99/hr (weekday) — we do not charge above-PAPL rates for registered-provider services.

Frequently Asked Questions

Summary

The 2025–26 NDIS changes have created a more challenging OT access environment — particularly for participants in regional and remote areas, those relying on in-home service delivery, and those with complex support needs requiring specialist OT expertise. The combination of a seven-year rate freeze, halved travel reimbursements, and legislative reforms demanding stronger evidence has raised the bar for both providers and participants.

The practical response for participants and support coordinators is clear: refer for OT earlier than ever before, ensure any FCA commissioned meets the 2025–26 evidence standards, and work with providers who have maintained in-home delivery and are producing the objective, standardised reports that the reformed NDIS framework requires. TEAH is doing exactly that — across Darwin, Perth, Brisbane, and Victoria.