Valuing an NDIS-funded therapy or allied health provider

Start with what the clinicians actually bill

A therapy provider sells clinician hours. The first analysis is productivity: for each clinician, the hours paid, delivered and claimed, split between direct service, travel, indirect work and unbilled time. Utilisation, the share of paid hours that produce a claim, moves the result most, because the price of each hour is set outside the practice.

Maintainable earnings are the profit the practice can reasonably repeat under a new owner. That means normalising the accounts: the owner's clinical hours are costed at what a replacement clinician would be paid, and their management time at a market salary. Supervision of early-career clinicians stays in as a real cost, and the payroll tax treatment of contractor arrangements differs between states and should be confirmed with your accountant. See what is maintainable earnings.

Reprice the hours at the valuation date

Maximum prices for 2026-27 are set by the Minister's first pricing determination and published by the NDIA in the NDIS pricing schedules effective 24 September 2026. The NDIA runs an annual pricing review that informs its advice to the Minister, so a margin earned under one year's settings is not evidence of the next year's.

HPNA restates historical revenue to the price limits, item codes and the travel and claiming rules for the discipline in force at the valuation date. A mobile practice carries a travel share a clinic-based practice does not, and the valuation shows it separately. See government funding exposure.

Management type, registration and who can buy

Funding in a participant's plan is NDIA-managed, plan-managed or self-managed. The NDIS Quality and Safeguards Commission states that a provider must be registered to support a participant whose funding the NDIA manages, while participants who self-manage or plan-manage may use an unregistered provider, and that specialist behaviour support requires registration.

That split shapes working capital. The NDIA states that claims for NDIA-managed participants are lodged within 90 days from the end of a service booking, whereas plan-managed and self-managed invoices are paid by a plan manager or the participant, with the credit risk that implies.

It also decides who can buy. The Commission states that a registration is linked to a single ABN and is not transferable, so an unregistered buyer of the assets cannot serve the NDIA-managed participants until it holds its own registration, and those participants may choose another provider meanwhile. In a share sale the registration continues with the company, but the Commission requires notification and, where a certification group is held and governance changes significantly, a condition audit started within three months. See the NDIS provider page.

Referrers and the therapeutic relationship

Therapy revenue arrives through referrers: support coordinators, paediatricians, schools and plan managers. HPNA measures revenue by referrer as well as by participant, because a practice with several hundred participants can still depend on three people for its intake. See participant and referral concentration.

Families follow a clinician more readily than a brand, and a contractor can leave with a caseload at short notice. The valuation removes the largest clinician's hours and asks what remains, reads the notice and restraint terms in each agreement, and weighs how hard the discipline is to recruit locally. See how practitioner dependence affects business value.

Goodwill has sources, not parts

Goodwill is the value of the practice above its identifiable net assets. The Australian Taxation Office's ruling TR 1999/16, reflecting the High Court's decision in Murry, describes goodwill as one whole, an indivisible item of property legally distinct from the sources it emanates from, which may be site, personality, service, price or habit. Where a sole practitioner sells, the ruling states that the goodwill emanating from their personality, reputation, skills or attributes is not transferable, nor is the goodwill emanating from key employees the purchaser does not engage, while other sources continue to draw custom.

In a therapy provider the sources that can survive a change of owner are systems, clinicians' agreements and referrer relationships held at practice level, and, where the entity itself is sold, its registration; the sources that leave are the individual clinicians and the owner's own referrer network. See transferable goodwill.

Paediatric caseloads and the 2028 change

The Department of Health, Disability and Ageing states that budget allocations for improved daily living skills supports, previously called capacity building daily activities, are reduced by 10 per cent for new plans and reassessments from 1 October 2026, extending to other participants at renewal from 1 February 2027, when unspent funds also stop rolling into a renewed plan. It notes that this reduces allocations rather than necessarily spending, and that some subgroups, including intensive and complex behaviour supports, are not affected.

The Department also states that from 1 January 2028 access will rest on a standardised assessment of functional capacity, that existing participants will be reassessed progressively over three years, and that children aged 8 and under with developmental delay or autism and low to moderate support needs will be supported through Thriving Kids rather than the NDIS. Children aged 8 and under already in the Scheme before that date continue to be reassessed under the earlier criteria until they turn 9, the Department states.

A practice weighted to early childhood referrals may therefore face a change in demand that its historical accounts do not show, so HPNA analyses the caseload by age band and states its assumption explicitly.

Choosing the method

An established practice is valued by capitalising maintainable earnings, stated as EBITDA or EBIT, at a multiple reflecting utilisation, clinician dependence, referral concentration, registration and Scheme exposure. That gives enterprise value; equity value deducts debt and adds surplus assets after assessing working capital. Where earnings are about to move for a dated reason, a discounted cash flow shows the step; net assets set the floor where earnings do not support goodwill. How to value an NDIS business in Australia compares the methods, and the fee bands are published.