Cash flow and individualised funding
3 minute read
Support at Home isn’t a small adjustment. It removes the buffer of block funding and forces every service hour to stand on its own. Every hour must be priced, justified and tracked and when it isn’t, the gaps show up big time in your cash flow.
At the recent Invox conference, Siobhain Simpson laid it out with zero spin: 'When you move from block funding to individualised funding your cash flow is absolutely stuffed... work out your monthly operating spend, divide your reserves by that number, and see how long you’d last if payments stopped. NDIS providers went half a year with no cash coming in.” Could you? If not, the time to build your buffer is right now, not when you’re already in survival mode.
The video captures Siobhain at her sharpest. In four minutes she distills the hard lessons from NDIS providers who’ve already lived this storm and maps them directly onto Support at Home. She delivers unfiltered clarity on cash flow and workforce productivity and details the stress tests every provider should be running right now.
We’ve summarised the advice into a 5-point survival plan
1. Cash flow buffer
Do the runway test now: reserves / monthly opex = survival months. For SaH providers, this isn’t optional, it’s the baseline for staying solvent under the new agreements. For CHSP providers, the next two years are a grace period. Use it to test different cash flow scenarios and work out where the cliff edge is.
2. Pricing and service review
Break services down to the absolute bones. Calculate the true hourly cost and compare this against StewartBrown and Departmental benchmarks. If the numbers bleed red, decide whether to redesign or drop that service. And there’s no room for “loss leaders” when cash flow is volatile. If you personally wouldn’t buy the service at that price, why would you keep delivering it?
3. Workforce productivity
Siobhain was blunt: “When hours billed to clients start to drop, you either get more clients or cut staff.” Track billable vs paid hours not just at program level but role by role. For SaH test this against your new agreements. For CHSP don’t wait, run models now with SaH ratios so you know the hit before it comes. If productivity dips, act fast. Delay just makes the cuts deeper.
4. Systems and invoicing
“You’re moving to daily, hourly invoicing… that is really hard to do.” Most of the sectors’ existing finance systems weren’t designed for this volume or frequency. SaH providers should run a one-week trial of daily claims and see what breaks. CHSP providers should simulate it with a mock week. The test isn’t just about software, it’s about whether your staff can keep up without drowning in admin.
5. Board preparedness
Boards may not like hypotheticals, but survival planning isn’t optional. Put worst-case scenarios on the table now: late payments, capped prices, doubled admin, forced service cuts. If your board hasn’t had the uncomfortable conversation yet, you’re already behind. Better to be the provider who was “too cautious” than the one blindsided.
The GYST
The bottom line? Use the time you have - whether that’s a few weeks or two years to get your fundamentals in order. The providers who do the hard work now will still feel the pain but they’ll have a path through it. The ones who wait will be watching from the sidelines.
