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You have a lot of payment options for treating substance abuse, depending on your circumstances. Though there’s some overlap between plans, and not all types of plans are available to all applicants, most people can put together adequate coverage through some combination of private health insurance, marketplace insurance, low-income coverage, senior health plans from Medicare, private payments at the point of service, and TRICARE for veterans and their families. Each coverage type has different requirements and limits, and it helps to know which options work together to provide maximum coverage for your addiction treatment plan.
Private health insurance covers a long list of health conditions in exchange for a monthly premium, which may be high or low, depending on your location and health habits. Full-coverage plans charge the highest monthly fee and cover all or nearly all of your healthcare expenses. Less expensive plans charge lower premiums, but they often leave you with the responsibility for costs at the point of service, which may be very high. Prior to 2008, insurance companies were not required to offer substance abuse treatment coverage, but the Affordable Care Act of 2010 imposed a requirement on all insurers to treat addiction as a preexisting condition for the purposes of granting coverage. This means that applicants with a history of substance abuse cannot be denied coverage because of that condition. Insurance companies are also required to provide addiction coverage as one of the 10 essential services all insurers must offer.
Because of the diversity of insurance companies across the country, there’s no single source to learn everything about every plan you could apply for. Instead, the best way to get the details about plan coverage and limitations is directly from the insurance carrier itself. You can also ask the staff at the rehab center you’re looking into to check with the insurance companies they accept on your behalf. Many insurance companies enter into cost-saving payment arrangements with rehab centers in their networks, and signing up for coverage from a company with this relationship to your rehab facility may save thousands of dollars.
Marketplace insurance plans are an outgrowth of the Affordable Care Act. These are state- or federal-sponsored insurance plans that get some or all of their funding from ACA subsidies. As a result, they’re typically much less expensive to the customer than private health insurance plans and are more regular in what they cover and how care is provided. There are limits to who can use these plans, however, which vary a lot between states. Marketplace insurance plans are typically only open to people who earn less than a given income threshold, for example, which varies by state. Under that threshold, the exact amounts you pay for the monthly premium and at the point of service also vary with your income and assets.
As it is with other types of insurance, marketplace plans cannot reject you for coverage because you have a preexisting condition, and all approved insurers are required to pay for substance abuse and mental health services. Some plans are structured as HMOs, which require you to seek treatment within their networks, while others are PPOs, which allow somewhat more flexibility in seeking care. You can browse through marketplace plans on your state’s healthcare insurance exchange website, where details and application requirements are spelled out for new members.
Medicaid is bound by federal law to provide coverage for substance abuse treatment, and you cannot be denied for your preexisting condition. The program is separately administered by each state, however, which means that costs and coverage amounts vary from place to place. Enrollment in Medicaid is limited to individuals and families with low income, pregnant women, and adults with disabilities. If you meet your state’s guidelines for receiving Medicaid, you can ask an intake worker about covering substance abuse treatment and how much the program can offset your out-of-pocket costs.
If you have Medicaid insurance, you can be treated at any provider that accepts payments from the program. Not every rehab facility takes Medicaid, however, and so it’s a good idea to check with the payment specialist at the center before you commit to a facility. Medicaid programs also sometimes impose an annual share of cost that you must pay before the program can pick up any of your medical bills. This can dramatically affect the amount you have to pay for rehab. If your share of cost is $5,000 a year, for instance, and your 30-day treatment costs $10,000, you should expect Medicaid to only pay half of your total bill.
Medicare is a federal health insurance program that is open to seniors aged 65 and over and to adults with a qualifying disability. The program is divided into sections based on the services it pays for, with Part A paying for most inpatient care and Part B covering many outpatient services. Medicare Part A coverage pays the cost of inpatient rehab that your regular doctor has deemed medically necessary. Part B provides for much of the mental health and counseling services you need to remain in recovery after your time in rehab. Part D is a prescription drug benefit that pays for much of the cost of medications your doctor prescribes, such as methadone, as part of your recovery.
Medicare Part A is provided at no cost to all eligible seniors. Parts B and D may charge a monthly premium for care, as well as imposing some out-of-pocket costs on beneficiaries. Many Medicare recipients choose to combine their coverage into a Part C, or Medicare Advantage plan. These group insurance options are legally required to provide 100% of Part A benefits plus some combination of Parts B and D. Some Medicare Advantage plans also cover extra services, such as art therapy or group counseling.
If you plan to use Medicare to pay for some of the costs associated with substance abuse rehab, you need to have a few questions answered. Ask your Medicare caseworker about plan options, limitations, and coverage, as well as your likely share of cost or copayments for various addiction-related services. You may also consider signing up for a Medigap policy to supplement your basic Original Medicare coverage since this can close much of the gap between your Part A coverage and the point where your regular Medicare supplement kicks in, resulting in lower out-of-pocket costs. You can also ask the intake worker at your rehab facility whether it takes Medicare payments, and if so, what the potential limits are to coverage.
TRICARE is government-funded health insurance for active-duty members of the military, honorably discharged veterans, family members, reservists, and members of the National Guard. TRICARE benefits include substance abuse rehab, and coverage cannot be denied for any eligible applicant. Addiction services provided by TRICARE include:
As costly as substance abuse rehab can be for many people, you’re not alone when it’s time to pay the bill. Federal law requires all providers of health insurance in the United States to cover substance abuse and mental health services as part of their essential coverage, and you cannot be denied insurance because you have struggled with addiction or are currently seeking rehabilitation help. Government health insurance plans can be an excellent way to keep your out-of-pocket costs down, though limits apply to who can get them. Private plans tend to be more expensive, but coverage options on the marketplace are highly diverse and affordable.
No matter how you intend to pay for substance abuse rehab, or even if you need to pay some or all of the cost on your own, the benefits of recovery more than outweigh the temporary price of inpatient care services. If you’re struggling to overcome drug or alcohol addiction, talk to insurance providers, social workers, staff at rehabilitation centers, and your loved ones to put together a plan to pay for substance abuse rehab with insurance and by other means. The result can be a lifetime of healthy, sober living.
Note: The purpose of this guide is to inform readers about how individuals who require substance abuse rehabilitation services can utilize various forms of health insurance coverage to cover in full or part the cost of these services. Always consult with a physician or addiction treatment specialist before beginning a substance addiction treatment program.