Using Health Insurance to Pay for Drug & Alcohol Rehab

The cost of addiction treatment often keeps people from getting the help they need.1 Insurance coverage can make treatment much more affordable. However, understanding how health benefits are applied to addiction treatment can be confusing.

This page should answer some of your general questions about using health insurance for rehab.

Health Insurance for Addiction Treatment

Does Health Insurance Cover Rehab?

Since the Affordable Care Act (ACA) was enacted, private and government-funded healthcare plans are required to provide coverage for substance abuse and other mental health problems.2 However, the level of coverage provided may vary greatly between these plans.

Many health insurance plans will only provide coverage for facilities that are within their network or will cover in-network treatment at a fraction of the out-of-pocket costs.

Fill out the form below to see how your insurance coverage would be applied to care at Oxford Treatment Center.

What Types of Addiction Treatment does Insurance Cover?

Insurance coverage for different levels of addiction treatment may vary. However, healthcare plans will generally cover:

  • Inpatient treatment, where patients temporarily live at the facility and receive daily treatment.
  • Outpatient treatment, where patients visit the facility several times a week to receive treatment and return home afterward.
  • Prescription drugs. Not everyone undergoing addiction treatment requires medication; however, it may be needed to mitigate withdrawal symptoms and cravings, or to treat co-occurring disorders in some patients.

In most cases, your health insurer will also provide coverage for medical detoxification. Addiction treatment primarily involves various forms of evidence-based therapy methods, including cognitive-behavioral therapy (CBT), family therapy, group therapy, and more.3

Often, in the summary of benefits and coverage of health insurance policies, substance misuse and mental health treatment options will be grouped together.

Insurance does not typically cover extended stays at a sober-living facility or experimental (non-evidence-based) treatment programs. Luxury rehab centers also may have different levels of coverage.

Some insurance companies that may cover some of your treatment include:

Using Insurance to Cover the Cost of Rehab

How Much Does Addiction Treatment Cost with Insurance?

The cost of treatment can vary greatly. Each insurance plan is different in the way it provides coverage, the deductibles and co-payments owed by the patient, and the maximum amount that the patient can pay. There may also be different costs and levels of insurance coverage for inpatient and outpatient care.

For example, one insurance company may charge you a co-payment amount for each visit to an outpatient facility (e.g., $40 a visit), while another may just charge a co-insurance percentage of the total cost of treatment (e.g., 30% of the treatment cost).

Some insurance may have a high annual deductible you must reach before insurance starts providing coverage, while others may have not deductible at all.

In most cases, choosing a treatment facility that is in-network with your health insurance plan will be the most cost-effective option.

Understanding Insurance Coverage

Insurance coverage contains a lot of nuances and specifics, and it is essential to understand some of the language used when it comes to insurance. Common insurance terms and their definitions are outlined below.

How Can I Pay for Rehab Without Insurance?

Despite recent improvements that have made healthcare more available, many Americans are still without health insurance. If you don’t have coverage, there are still a few ways you can pay for treatment without insurance.

Many treatment centers offer financing options or use a sliding scale to provide services at a lower cost for people undergoing financial hardships.

There are also government-funded and charity programs that may provide free rehab or treatment at a very discounted cost. However, demand for these programs is often very high, meaning they have strict criteria for acceptance and there will likely be a long wait before you are admitted.16

Qualifying Life Events

If you experience a qualifying life event (QLE), you may be able to apply for health insurance outside of the yearly open enrollment period. The four basic types of qualifying life events include:

  • Loss of health coverage.
  • Changes in household (e.g., getting married/divorced, having a baby/adopting, a death in the family).
  • Changes in residence (e.g., a seasonal worker moving to or from a place of work, moving into a shelter/transitional housing, a student moving to or from where they attend school, or moving to a different zip code or country).
  • Other qualifying life events:
    • Changes in your income that impact the coverage you qualify for
    • Gaining membership in a federally recognized tribe or status as an Alaska Native Claims Settlement Act Corporation shareholder
    • Becoming a U.S. citizen
    • Leaving incarceration
    • AmeriCorps members beginning/ending their service

To determine if you are experiencing a qualifying life event, call 800-318-2596 or visit Qualifying Life Events to learn how to apply.

Health Insurance Tips

Types of Health Insurance

The following are examples of different types of insurance plans that may be used to pay for rehab:

5 Tips for Using Insurance to Cover Rehab

Navigating insurance coverage to defray the cost of rehab may initially seem daunting, but there are several ways to make the process easier.

  1. Learn everything possible about the insurance policy. Go over the policy with a fine-tooth comb to determine what is covered and what the requirements are for coverage to be granted.
  2. Keep up with monthly premiums. Staying current with insurance payments ensures that there will be no lapse in coverage.
  3. Understand all out-of-pocket expenses and budget accordingly. Talk to a professional at the chosen rehab facility about payment plans and options.
  4. Know what type of plan you have, whether or not services are in-network or out-of-network, and whether or not a referral is required.
  5. Make sure that the services required are covered and that the facility is an approved provider. Even if the level of care a person needs is not covered, be sure to discuss options with staff members.
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