When disability providers face trouble: what it means for participants and the sector

Recent events involving Cocoon SDA Care, one of Australia’s fastest-growing NDIS providers, have spotlighted the challenges facing the disability support sector.

While the specifics of the Cocoon case are still unfolding, it raises important questions about what NDIS participants and their families can do to safeguard their support.

Why are some disability providers struggling?

The NDIS has expanded rapidly since its launch, with thousands of providers entering the sector. While this growth has improved choice for participants, it has also introduced challenges.

• Funding complexity
  Payments to providers are often delayed due to audits or administrative issues, which can affect cash flow and service continuity.
• Low margins and rising costs
  Providers are facing higher labour costs, growing compliance requirements and difficulties recruiting qualified staff, particularly in regional areas.
  
• Rapid scaling without strong governance
  Some newer or fast-growing providers lack the internal systems to manage complex operations and regulatory obligations effectively.
• Increased scrutiny
  Government crackdowns on fraud and misuse of funds, while necessary, have resulted in greater pressure on providers to prove every dollar is well spent.

For a deeper understanding of common NDIS funding and provider challenges, see the NDIS Commission provider resources and official NDIS guidelines.

 What can participants do if they’re concerned?

If you or a loved one receives services from a provider that is struggling or you simply want to be prepared, there are a few key steps you can take.

1. Stay informed and communicate
   Ask your provider for updates if you hear about disruptions or changes to service. Clear communication helps everyone respond quickly to emerging issues.
   
2. Know your rights
   Participants have the right to switch providers at any time if their needs are not being met. You can read more about participant rights on the NDIS website.
   
3. Use your plan flexibly
   Many NDIS plans allow for flexibility in how your supports are delivered. If your current provider cannot deliver services — due to closure, disruption or dissatisfaction — you may be able to temporarily or permanently access similar services through another registered provider.

To explore your options, you can use tools like the Disability Support Guide. In this easy-to-use online directory, you can search for local NDIS-registered providers by service type, location or support need. The platform allows you to compare offerings and read about each provider’s services, helping you make confident and informed choices while maintaining continuity of care.

Always check with your support coordinator or plan manager if you’re unsure how to switch or adjust your funding accordingly.

Contact the NDIS Commission
If you’re worried about a provider’s safety, service quality or conduct, you can lodge a complaint directly with the NDIS Quality and Safeguards Commission.

What do you think about the sustainability of the NDIS? Let the team at Talking Disability know and subscribe to the newsletter for more information, news and industry updates.

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