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When looking for a treatment program that accepts your insurance, two important questions to consider are how much your insurance will cover and what your out-of-pocket costs will be. Health insurance policies commonly cover some addiction treatment services, while others are often excluded. Learn how to find out what your insurance policy will pay for addiction treatment, how to find affordable drug and alcohol insurance for rehab if you don’t have insurance, and how to pay for addiction treatment if you do not have insurance.
What Is Drug and Alcohol Rehab Health Insurance?
Alcohol rehab insurance includes mental health and substance use disorder (SUD) coverage provided by private, employee-paid group health plans, and through the Affordable Health Care Act’s Marketplace. Insurance for rehab will cover treatment for a person’s addiction to:
Not all health plans offer coverage for SUD treatment. If you or a loved one is in need of rehab, the first step is to ask how does insurance cover alcohol rehab and other addiction treatment services under your plan. If your plan does not have any coverage, you may consider switching to an insurance plan that does or finding a supplemental plan that includes insurance for rehab.
How Does Health Insurance Cover Rehab Services?
Most insurance plans that do include substance use disorder treatment cover the cost of treating SUDs, or addiction to drugs and alcohol, and mental health conditions.
Health insurance coverage for addiction treatment typically covers certain types of approved rehab facilities and treatment modalities, such as:1
- Inpatient residential rehab
- Intensive outpatient programs (IOPs)
- Partial hospitalization programs (PHPs)
- Medical detox
- Dual diagnosis treatment
- Maintenance medication for addiction
- Counseling after rehab treatment
Services covered by drug and alcohol rehab insurance vary depending on the company and type of plan. Behavioral healthcare insurers such as APS Healthcare offer comprehensive recovery and mental health services through a network of clinics.
Providers of rehab insurance, such as American Family Insurance (AFI), are required to offer coverage for substance use treatment at the same level that they cover other medical problems. For example, if you have an AFI plan that covers 70% of your medical expenses, it will also cover 70% of your drug and alcohol rehab costs.
Insurance for rehab through a company such as AmeriHealth vary based on the type of plan you have. An HMO plan typically requires the least out-of-pocket cost through a limited network of healthcare providers. A PPO plan offers a wider selection of providers with cost differences between in-network and out-of-network providers. Plans may also differ widely based on the amount of coverage provided for the length of stay at an inpatient rehab center or a number of visits at an outpatient clinic.
With the various types of plans and coverage, it’s important to understand what your insurance provider covers for rehab. Contact your insurance company’s member services for more information about what is specifically covered under your insurance plan before entering a SUD treatment program.
Are There Services That Drug and Alcohol Rehab Insurance Does Not Cover?
Healthcare coverage is usually not provided for anything deemed medically unnecessary, such as holistic care, recreational activities, gourmet meals, or non-medical amenities. Examples of supplemental holistic care that may not be covered include:
- Massage therapy
- Music therapy
- Art therapy
- Mindfulness meditation
Other services that may not be covered include religious counseling, educational services, and vocational rehabilitation.
However, if a holistic method is part of evidence-based therapy, it may fall under your coverage. For example, dialectical behavior therapy (DBT) teaches one specific type of mindfulness. Mindfulness sessions with a DBT provider may be covered when mindfulness with a holistic provider would not be.
A return to drinking or using addictive substances after rehab is called a relapse. Relapse treatment may not be covered by insurance, despite varying levels of coverage.
If your current insurance plan does not provide the level of substance use and behavioral health treatment you will need, some insurers offer supplemental plans that can be added to your current plan to expand the coverage. Note that insurance cannot be applied retroactively so you must enroll in a supplemental plan before entering rehab.
How Much Will Insurance for Rehab Pay?
Under the Mental Health Parity and Addiction Equity Act, health insurance companies and group health plans that offer coverage for SUD treatment must provide the same level of coverage for mental health services, including drug and alcohol addiction treatment, as they provide for medical conditions.3
However, these provisions do not apply to group health plans offered through an employer with less than 50 employees. The Act also does not require that plans of any size provide insurance for rehab. The Act only applies if employer insurance does offer rehab insurance.3
If your plan covers the cost of treating SUDs and mental health conditions, it is up to you to find out exactly what your insurance plan covers and what you will be responsible for paying out-of-pocket.
The amount your insurance pays toward your drug or alcohol addiction treatment can differ depending on several factors such as: 2
- Your policy’s behavioral health benefits
- Your specific treatment needs
- Whether the treatment facility or provider you choose is in– or out-of-network
- The length of your stay in residential rehab or number of outpatient visits
How Do I Find Out About What My Insurance Plan Will Cover for Rehab?
A clear understanding of what is covered by your plan and what’s expected for you to pay for out-of-pocket can give you peace of mind while receiving inpatient or outpatient rehab care. You can check the coverage of your insurance plan by contacting your insurance provider.
Here are some questions to ask when investigating what your coverage and out-of-pocket costs will be:
- Does your insurance provider have a list of in-network treatment providers they can send you or refer you to online?
- Does your insurance plan cover specific stages of treatment and levels of clinical care for rehab? Ask for these details so you’ll know exactly the services your plan will cover.
- Is there a maximum length of stay your plan will cover for inpatient rehab or a maximum number of outpatient visits?
- How does your insurance provider define “medical necessity” for addiction treatment coverage? Is a referral, pre-approval, or prior authorization required?
- What are your plan’s copays and out-of-pocket deductibles for the treatment you want to receive? Do you have a coinsurance responsibility after meeting your deductible? What is your out-of-pocket maximum?
If you are having difficulty finding an in-network provider of addiction treatment services you are seeking, ask your insurance company if they may have a behavioral health advocate who can help you find qualified treatment.
What Do Plans Under the ACA Offer for Drug and Alcohol Rehab Insurance?
The Affordable Care Act (ACA)—also known as Obamacare—introduced reforms to increase the availability of health insurance for more people. The ACA requires plans offered through the ACA Marketplace or Medicaid to provide coverage for 10 essential health benefits, including treatment of substance use disorders.4
If you’re eligible for an ACA insurance plan, you may find a plan that pays for treatment services for a drug or alcohol use disorder at a lower monthly premium than other commercial plans.
Your family’s income and household information determine whether or not you qualify for ACA coverage. Some of the services covered by ACA plans include:5
- Addiction assessment
- Brief intervention
- Medical detoxification (detox)
- Inpatient services
- Medications used to treat addiction
- Alcohol and drug testing
- Home health care visits
- Counseling for the family
- Medications that prevent cravings
The Affordable Care Act established an online marketplace where you can apply for ACA-sponsored insurance plans—HealthCare.gov. In addition to the federal site, several states operate their own Health Insurance Marketplace platforms.5 The ACA healthcare coverage application process varies by state, so you should check with your state to learn more.
How To Sign Up for an ACA-Sponsored Insurance Plan
To enroll in an insurance plan through the federal Health Insurance Marketplace plan, go to HealthCare.gov to start the application process by completing the following steps:6
- Create an online account on the Health Insurance Marketplace website.
- Complete your application.
- View available health plans.
- Consult a Health Insurance Marketplace agent once approved for a plan sponsored by the ACA above the specifics of your coverage for SUD treatment.
What If I Cannot Get Drug and Alcohol Rehab Insurance?
Depending on your income and other financial obligations, you may not be able to afford the monthly premiums or deductibles of a commercial insurance plan, even one obtained through the ACA Marketplace. Some individuals also have other barriers to obtaining insurance, such as not having a current state or federal ID.
You still have resources that can help you to receive treatment for a drug or alcohol use disorder if you do not currently have the option to enroll in insurance, including: 7,8
- Some states offer treatment funded by block grants from the Substance Abuse and Mental Health Services Administration (SAMHSA). Call SAMHSA at 1-800-662-4357 for help locating a center that offers grant-funded treatment.
- At FindTreatment.gov, you can search for treatment centers that offer free care or a sliding-fee scale. You can also search for facilities that accept Medicaid or Medicare.
- Certain treatment centers offer scholarships from affiliations with foundations or private sponsorships.
- Some treatment centers offer payment plans or discounted rates for cash-pay clients.
For more information about addiction treatment, call 800-405-1685 (Who Answers?) to speak with a rehab specialist today.
- Recovery Research Institute. Addiction Treatment Insurance Guide. Special Topics and Resources.
- Blue Cross Blue Shield. (MA). IT’S HARD TO ASK FOR HELP. BUT WE MAKE IT EASY TO GET IT. Blue Shield of Massachusetts.
- Centers for Medicare & Medicaid Services. The Mental Health Parity and Addiction Equity Act (MHPAEA).
- Office of National Drug Control Policy. Substance Abuse and the Affordable Care Act.
- Heathcare.gov. Mental health and substance abuse coverage. Health benefits & coverage.
- Healthcare.gov. Get Coverage.
- Substance Abuse and Mental Health Services Administration. (2021). FY 2021 Substance Abuse Prevention and Treatment Block Grant Program American Rescue Plan Supplemental Awards.
- FindTreatment.gov. Find a treatment facility near you.