Profit vs Care under the NDIS

By Jason Cartwright, Chief Executive Officer of Healthcare Australia

Over the past 11 years in my various recruitment, business and leadership roles, I have continually come across the debate between not-for-profit and for-profit companies working in the Health and Community Care Industry.

There has always been a general assumption across the industry that for-profit companies are more focused on achieving the highest profit whilst not-for-profit organisations are driven by the quality of care delivered to their customers. However, in my opinion, regardless of the type of organisation, they must focus on both objectives to be successful.

Within the NDIS, approximately 450,000 individual people across Australia require a range of care and support services, some of which are the most vulnerable people in the country. To this end, maintaining the quality of services and care is an integral factor in the success of delivering the NDIS.

As we get closer and closer to the full rollout of the NDIS, a new batch of providers have entered the disability services industry from both not-for-profit and for-profit backgrounds, Healthcare Australia (HCA) included. Inevitably, debate has continued about the impact that for-profit companies will bring to the disability services space.

With each individual exercising choice and control with more than 10,000 registered providers, many of which have no or little experience, the risk of low quality services or harm to individuals has increased. However, history tells us that competition breeds quality control.

While the notion of the NDIS and Consumer Directed Care might be new for Australia, similar programs are in operation across the world. Similarly, other industries and throughout history have faced this problem before:

“How do you ensure quality control in an open and free market?”

Government regulation forms a part of it, as it always has. They ensure that fence posts are placed at the borders of industry that cannot be crossed, usually in the form of minimum standards. However, as we continually see, such regulation only goes so far, and this problem is not confined to the healthcare industry. Corporate governance has been studied and modified throughout history and forms much of the ‘borders’ or minimum standards that companies must meet in Australia.

The benefit of a free and open marketplace, which the NDIS is with some regulation, is that such markets have been shown to self-regulate. Competition in a free and open market means that customers exercise choice and control. Subsequently business models, or operating modals, adapt to this choice and ‘loyalty’ with unique selling points and guarantees to obtain and retain customers.

Ultimately, for both for-profit and not-for-profit to succeed, they need to maintain a strong focus on customer services. The ability for unhappy customers to change or move providers is now a relatively easy task, and therefore, current providers which have retained customers and clients for many years are now more susceptible to customer sentiment and loyalty.

In a health and community environment however, not every customer or client is able to speak for themselves and communicate their satisfaction or dissatisfaction of services. For this reason, the customer loyalty and associated ‘profit’ which drives business decisions related to the duty of care to customers does not offer the same protection for quality control.

Organisations still have significant incentive to provide the highest possible level of quality services.

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