Does Insurance Cover Rehab?
- Public and private insurance policies cover substance abuse treatment to varying degrees.
- If you don’t have insurance, look at payment plans, sliding scale programs, SAMHSA grants or financing options.
- Other options include 12-Step programs, SMART Recovery or stabilization programs.
- Free rehab programs can be hard to find and get into but are possible.
- There is an increasing recognition that addiction is a disease and should receive the same treatment coverage as a medical condition.
Paying for Drug Rehab With Insurance
Who Answers? if you have questions about using insurance to cover the cost of substance abuse treatment.
The American Medical Association recognizes alcoholism (alcohol use disorder) and substance addiction (substance use disorder) as diseases, forcing health insurance companies to recognize the need for treatment coverage.
In addition, the 2008 Affordable Care Act and Mental Health Parity and Addiction Equity Act require that, for insurance providers that offer coverage for behavioral health conditions, mental health and substance abuse treatment benefits be comparable to medical care benefits. This means insurance policies – both public and private – must cover substance abuse treatment to the same extent that they cover other medical conditions.
The Affordable Care Act further ensures that insurance agencies can no longer deny coverage to anyone based on a pre-existing condition, including substance addiction. If you do not have insurance, you can apply for coverage at any time. This may help to drastically reduce your out-of-pocket costs for treatment.
What Insurance Generally Covers
Insurance policies vary in the amount of treatment services that they cover. But most policies will cover one or more of the following:
- Assessment – generally fully covered.
- Detoxification – generally mostly covered, but rapid detox and ultra-rapid detox tend to not be covered.
- Outpatient treatment – generally mostly covered.
- Inpatient (residential) treatment – generally partially covered.
Insurance policies will cover addiction treatment to the same extent that they cover other medical conditions. But they will only cover what a professional determines to be “medically necessary.”
Healthcare.gov defines medically necessary as “health care services or supplies needed to diagnose and treat an illness, injury, condition, disease or its symptoms and that meet accepted standards of care.” These services would likely include things such as a treatment program and a bed, but not a private room with a daily linen-change service.
Professional assessment is generally fully covered by insurance policies, and an official diagnosis of addiction or substance dependence (substance use disorder) will make a big difference in how much treatment your insurance will cover.
Once the official diagnosis is made, insurance will cover almost any type of addiction, with varying degrees of the level of treatment covered.
How to Determine Your Coverage
- Call Member Services at your insurance company – have your membership identification number ready.
- Write down the name of the representative(s) you speak with, as well as any notes about the conversation.
- Ask what “levels of care” are covered for addiction treatment (assessment, detox, inpatient, outpatient, residential, hospital-based, partial hospitalization, etc.).
- Ask about in-network and out-of-network providers and the percentage covered by insurance for each.
- Ask about co-pays and deductibles.
- Ask what your out-of-pocket maximum expense is.
- Ask what criteria your insurance company uses to determine medical necessity.
Another option is to reach out to the admissions department of the program you’re considering regardless of what insurance you have or what you’ve heard about your policy. Programs have many ways of flexing benefits to make policies work.
Medicare and Medicaid Coverage
Medicare and Medicaid are government-sponsored insurance plans that cover screening for substance abuse. But this coverage does not always include treatment.
Medicare is for anyone 65 or older or with a severe disability no matter what their income level is. Its coverage changes based on the type of care you’re seeking.
- Inpatient – Medicare covers up to 190 days of inpatient services during your lifetime, with a $1,260 deductible and variable co-payments.
- Outpatient – Medicare covers counseling and therapy, one screening per year, medication management and one yearly “wellness” visit (you pay 20% of treatment costs).
- Partial hospitalization – You pay a percentage of each service, as well as daily co-payments and a deductible.
Medicaid is a plan for low-income households. The plan is run on a state-by-state basis, with each state covering varying degrees of treatment. However, Medicaid does require a number of mandatory services to be covered. These services include both inpatient and outpatient care, as long as the facility you choose accepts Medicaid.
Health Insurance Marketplace
Health Insurance Marketplace plans cover substance abuse treatment to varying degrees, depending on the state.
The open enrollment period for the marketplace plans takes place once a year, from November 1 to January 31 for coverage in the new year. You may also qualify for special enrollment periods in the case of certain life events:
- Moving to a new state.
- Certain changes in income.
- Changes in family size.
- Gaining membership in a federally recognized tribe.
Losing your job can bring anxiety and stress regarding healthcare, but there are options for maintaining your health insurance coverage. If you lose your job-based coverage, your former employer may offer you COBRA (Consolidated Omnibus Budget Reconciliation Act) continuation. COBRA provides people who lose their jobs, and their families, with the choice to temporarily retain the group health coverage they had under their employer’s group health plan.
To be eligible for COBRA, you must have insurance that is covered by COBRA, a qualifying event (including job loss), and be a qualified beneficiary. Your former employer will inform you of your eligibility to maintain your insurance through COBRA, and you will have at least 60 days to decide if you want to continue your coverage. Once you have decided to continue your coverage, you will sign up for COBRA, and you will be responsible for paying the entirety of your premium (what was previously covered by you and your employer).
Once you are enrolled in COBRA, you will have the same coverage you previously had when you were employed. That includes any mental health and substance misuse treatment that was covered through your insurance plan. If you are pursuing treatment while covered by COBRA, you will be responsible for paying your premium. Although it might be slightly more complicated than it was when you were employed, losing your job does not have to mean that you cannot receive the substance abuse treatment that you need.
Paying for Drug Rehab Without Insurance
Contact the Substance Abuse and Mental Health Services Administration (SAMHSA) to speak to a specialist about treatment program options based on your insurance or ability to pay.
If you do not have insurance, you have a couple options to ease the burden of paying for treatment.
One option that many facilities offer is spreading the cost out across a payment plan. The plan involves monthly payments over a predetermined amount of time that equal the cost of treatment. Payment plans are a great way to spread the cost out to make treatment much more affordable.
Another option to pay for treatment is to find a facility that uses a sliding scale payment method. Sliding scale is a fee structure based on your ability to pay. You will only be required to pay what you can reasonably afford. People with lower incomes will be expected to pay less than those with higher incomes.
The Substance Abuse and Mental Health Services Administration (SAMHSA) has a free facility locator to search for treatment centers near you with payment assistance programs.
Rehab Financing Options
Other financing options for paying for substance abuse treatment include:
- Credit cards.
- Health care credit cards.
- Personal loans.
- Home equity loans.
- Specialized loan companies.
Many treatment facilities also offer rehab scholarships, where the facility will cover part or all of the cost of recovery.
To find facilities that offer these scholarships:
- Call the programs that you’re considering.
- Tell them your situation.
- Ask if they offer rehab scholarships and what you need to do to be considered for one.
Most treatment facilities have a specific amount of money they can use for rehab scholarships per year. So if they cannot fund you, make sure to ask about other facilities nearby that may offer financial help.
Another way to get help paying for rehab is to apply for a SAMHSA grant, which can cover part or all of your recovery costs. In some cases, your state substance abuse agency will even reimburse treatment costs.
Regardless of whether or not you have insurance, substance abuse treatment is an important and vital step toward saving yourself from the downward spiral of addiction.
Other Treatment Options
12-Step self-help programs
12-Step programs (for example, Alcoholics Anonymous and Narcotics Anonymous) are free recovery options that work best when practiced along with other treatment options. These programs follow a spiritual route to recovery. They begin with the admission of being powerless over addiction, inspiring a new way of living and lifelong recovery development.
If a spiritual journey is not for you, try the science-based Self-Management and Recovery Training (SMART). This program is also a free support group that uses proven techniques from cognitive behavioral therapy. SMART recovery’s goal is to support and encourage participants to evaluate their own thoughts and behavior patterns in order to make positive changes in their lives.
Stabilization programs are another viable low-cost treatment option. These programs generally involve 2 to 6 weeks of stay following detoxification, and they focus on progress in recovery rather than slip-ups. Once you complete the program, you have the option to move on to a sober house or therapeutic community.
Holistic (or alternative) treatment programs, yet another potentially lower-cost recovery option, focus on the health of the mind, body and spirit. They incorporate traditional treatments (detox, therapy, medical care, etc.) with holistic services such as yoga, acupuncture and meditation to heal and help a person on the road to recovery.
While rare, there are free drug rehab options. Many religious organizations offer treatment as part of their ministry services at no cost. Non-profit rehab organizations also offer low-to-no cost treatment. These free programs take an extra bit of effort to get into, but it is possible if you put in the time.
Get Help Finding a Program
You are never too old to improve your health and quality of life!