The NSW government says it will aggressively get behind a proposed National Disability Insurance Scheme (NDIS) and wants the initiative to be trialled in the Hunter Valley region.
Disability services minister Andrew Constance on Thursday said the coalition supported a national overhaul of disability insurance, which would cover the cost of care and medical treatment for people with a disability.
The Productivity Commission in February released a report proposing the overhaul of disability insurance in Australia.
"We give in principal support for the implementation of a national scheme," Mr Constance told reporters on Thursday.
"We have to be honest about this. The state system is broken. It isn't meeting the needs of families, carers and people with disability across this state."
Mr Constance said the Hunter region would be the most appropriate place to trial an NDIS given its population size and mix of rural and metropolitan settings.
The Productivity Commission's report proposed two options for the NDIS, which it estimated would cover 360,000 people nationally.
One option is a large scheme similar to Medicare, which would cover people born with significant disability, including the cost of care and accommodation.
The second proposal is a much smaller scheme, which would cover those who sustain catastrophic injuries in accidents and build on existing state and territory systems.
The commission's report said the scheme would require at least a doubling of the $6.2 billion already spent by governments on disability care each year.
However, in April the Law Council of Australia (LCA) questioned the commission's costings and said the required funding would be more than triple the Productivity Commission's figures.
The LCA said NSW spent $38 million in 2010 supporting 390 people who had acquired severe disabilities through road accidents.
Mr Constance was joined at the press conference by former NSW disability services minister John Della Bosca, now campaign director for the NDIS.
"Andrew and I have probably had a few disagreements over the years about a range of things," Mr Della Bosca said.
"But one thing we agree on... is that we have to do something important and something major about the situation of Australians living with disability."
"This problem, while not unique to Australia, is something we don't do well as a country."
Sue O'Reilly, spokeswoman for the disability care reform group Mad as Hell, said while the current system was dysfunctional and wasteful, it was ignored by most people who think disability won't affect them.
"You can dive into the surf at Bondi and you can become a very severe quadriplegic for life," she said.
"People need to understand that we're all, every single one of us, every day, at some sort of risk of disability affecting our lives."
Earlier this week, the Victorian government offered to host the first stage of implementing a national disability insurance scheme.