Understanding your client’s needs and setting their expectations at the outset is key to creating a positive customer experience – and that’s a win for them and for you!
As an added bonus, a service agreement that confirms the type, quantity and cost of the services you’ll deliver can help to lock in repeat business – and it means we can set aside funding from our mutual client’s plan to make sure it’s available every time you invoice. That reduces the risk of a payment delay due to insufficient funding and helps you to manage your cashflow with confidence.
While they aren’t compulsory, service agreements are recommended. But what do you put in them, what happens when a client can’t (or won’t) pay you, and how enforceable are they? We turned to AFA Support Coordination’s Elizabeth Hickey for answers.
For a participant in the NDIS, they help with understanding what services will be provided, what expectations they can have of their provider, and what the cost of their services will be.
For the provider, a service agreement is a written formal contract that covers the conditions of service delivery, the costs their client can expect, and what the rights and responsibilities are for each of them.
Service agreements should be easy to understand, clearly outline supports and how to cease services, detail the rights and responsibilities of the provider and the participant, and clarify who to communicate with in relation to supports.
Here’s a checklist of what to include in a service agreement – and a couple of tips:
Tip #1: One of the biggest jobs for a service agreement is the clear identification of what the services in it cost, what the participant will be charged for (like travel and reports), and how much they can expect to pay for the services they’ve agreed to. This may include a daily, weekly or monthly breakdown of the expected supports to be delivered, along with an estimated budget for the term of the agreement.
Tip #2: Service agreements should be accessible and easily understood. It’s a provider’s responsibility to ensure their client understands what they’re agreeing to. It’s also a responsibility of the provider that the service agreement is in a format that’s accessible for their client. This may mean it needs to be in an appropriate language or meet the needs of the person – like producing it in Braille if required. The participant may also need formal interpreting for the meeting in which they’ll be signing the agreement – to ensure the provider is satisfied they understand what’s in it.
Ongoing service agreements are one of my biggest concerns. Typically, where an ongoing agreement is in place, the service provider and their client are less likely to regularly review service delivery and if there are any changes needed.
The actual costs that will be incurred are also less likely to be clear for the client.
Note: An exception to this is plan managers. At My Plan Manager, our service agreement is ongoing because, unlike a therapy provider whose services may need to adapt to the client as they grow capacity and hit their goals, plan managers offer the same suite of services to every client – services that don’t vary in line item or in price.
For more information about what we do, click here.
Also, another mistake is not clearly outlining the expected cost of service as agreed upon with a client.
While this can be more difficult for a less frequent service (where it can be hard to predict the needs of the client and factor in the cost of inflation), by clearly articulating the total expected cost as accurately as possible, clients (or nominees) are better able to manage their budget. This means a provider is less likely to have issues with their client going over budget.
Over the years, many service providers have questioned what the benefits of a service agreement are and why they should have one. Many have said a service agreement ‘doesn’t really matter’, but I’ve always said that it absolutely does, for a number of reasons:
While it’s best if a client signs a service agreement, this doesn’t need to happen as long as their provider has evidence that the service agreement was discussed, a copy was provided, and service delivery was agreed to by their client. This can be done though file notes, emails, and by the booking of sessions.
The good news is, there are fewer problems with payments when a well written service agreement is in place. However, there may be times when a client runs out of funds mid-plan or decides they no longer want to pay for a service or part of a service.
In the event a client refuses to pay an invoice, the provider can approach the NDIS directly for support.
With a well written service agreement, a client is less likely to run out of funds. However, the service agreement also assists the provider to outline when services will be withdrawn or that it’s the client’s responsibility to ensure funds are available. One of the biggest parts of being a provider is clear and ongoing communication with a client to ensure ongoing funding is available and to support them to regularly review and adjust services.
Note: While plan managers like My Plan Manager can ‘lock in’ funding from a client’s budget if a service agreement is in place, the client can request to reverse that allocation at any time. That’s why it’s important for providers to regularly review and adjust their services so they continue to receive client buy-in.
If you have any questions about service agreements, be sure to contact our friendly team. You can email us at [email protected] or call us on 1800 861 272 from 8am-5.30pm (SA time), Monday to Friday.
14 February 2025
