Understanding Your NDIS Cost Model: What the Price Actually Covers
The NDIS cost model for providers, decoded: what the PAPL price limit covers versus the SCHADS wage you pay, and where your margin really goes.
What an NDIS cost model is
The price limit is not your revenue per hour
Where the money between price and wage goes
A worked example: one hour of weekday support
Billable versus non-billable time is the hidden lever
Different supports have different cost models
Registered versus unregistered changes the model
Frozen and capped prices squeeze the model from both ends
Prove-and-pay and the 90-day window add cash-flow cost
How to build your own cost model in five steps
Decision aid: is a support line worth delivering?
Frequently asked questions
Is the NDIS price limit the same as my profit per hour?
No. The PAPL price limit is the maximum a provider can charge; it is not revenue you keep. From that price you pay the support worker's SCHADS wage (roughly $31-$44 an hour), plus super, insurance, non-billable time, supervision and back-office costs. On standard supports the actual margin is often under 10%, and it can turn negative when utilisation drops.
What is the difference between the PAPL and the SCHADS award?
They are two different numbers from two different bodies. The PAPL (set by the NDIA) is the price limit you can charge a participant's plan. The SCHADS award (MA000100, set by Fair Work) is the minimum you must pay your worker. Your cost model lives in the gap between them, and that gap has to cover every other cost of running the business.
Why does utilisation matter so much in an NDIS cost model?
Because your fixed overheads and non-billable wage costs are recovered only from the hours you actually bill. If a worker is paid for 38 hours but bills 30, the cost of the other 8 is loaded onto those 30. A support line that is profitable at 85% utilisation can lose money at 70%, even though the price never changed.
How often should I rebuild my cost model?
At minimum, every time a new PAPL is published (around late June, effective 1 July) and every time the SCHADS award is adjusted through the Fair Work annual review. Super rising to 12% from 1 July 2026 is one such trigger. A model built on last year's figures can show a margin that no longer exists.
Do the 2026-27 reforms change my costs?
Yes. Super rises to 12% from 1 July 2026; SIL and digital-platform providers face mandatory registration (group 0138) from 1 July 2026; broader mandatory registration for high-risk supports begins 1 July 2027; and 'prove and pay' plus a proposed 90-day claim window (Bill-dependent, from 1 December 2026) add cash-flow and record-keeping cost. Build registration, audit and bad-debt allowances into your model now.