Does Insurance Cover Rehab for Drugs and Alcohol?
Yes, health insurance often covers rehab for drug and alcohol use.
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But the coverage you get depends on where you live and the plan you choose. That's because each state has a different set of standards for the type of coverage offered by health plans.
That includes the amount of time you can spend in a rehab center, what rehab centers you can go to and the costs you're responsible for paying. Plus, health plans might limit your coverage by only paying for certain types of treatment.
Does insurance cover drug and alcohol rehab?
Health insurance typically covers drug and alcohol rehab. The Affordable Care Act (ACA), also called Obamacare, requires regular health plans to cover treatment for mental health and substance use disorders, including inpatient stays in rehabilitation centers and outpatient rehab care.
It's important to remember, the ACA doesn't list specific coverage requirements plans have to follow. That means the length of time you can spend in a rehab facility, the type of facilities you can visit and the amount of your bill you're responsible for paying depends on your plan details.
You may also need to get permission from your insurance company, called preauthorization, before you can go to rehab. The preauthorization process can cause delays in getting coverage. In some cases, you may have to appeal if your preauthorization is denied, which can make it even more difficult to get coverage.
Each state chooses what's called a "benchmark health plan" that helps set the standard for the type of coverage companies should offer. In states with generous benchmark plans, you may have an easier time getting your insurance to pay for alcohol or drug rehab.
But all states have to follow federal coverage rules. That means you'll have access to some rehab services with an ACA plan, regardless of where you live.
The Mental Health Parity and Addiction Equity Act requires health insurance companies to offer levels of coverage for mental health and addiction services similar to other medical services. This means health insurance companies can't discriminate against people suffering from addiction.
For example, a health insurance plan can't charge you higher copays for addiction counseling than you'd pay for physical therapy.
Does Medicare cover alcohol rehab?
Medicare offers limited rehab coverage for alcohol and drugs.
Medicare is made of several parts. The coverage you get, and the amount you'll need to pay toward your medical bill depends on the part of Medicare you use.
- Medicare Part A covers inpatient hospital stays, including psychiatric hospitals. But Medicare Part A excludes most rehab centers. You'll have to pay a $1,676 deductible for the first 60 days of your visit, $419 per day for days 61 to 90 and $838 per day for days 91 through 150. You're responsible for paying all costs starting on day 151.
- Medicare Part B covers doctor visits and other outpatient services, such as addiction counseling. You have to pay a $257 deductible before most treatment starts.
- Medicare Part D may pay for drugs you need to take, such as Antabuse or Naltrexone. These plans cost an average of $65 per month, and typically come with a separate deductible.
It's a smart idea to get a Medicare Supplement (Medigap) plan if you have Original Medicare (Parts A and B). A Medigap plan will cover most of the costs you're responsible for paying with Original Medicare.
This can save you thousands of dollars per year or more if you need alcohol or drug rehabilitation services.
Medicare Advantage (Part C) plans offer bundled coverage and are sold and managed by private companies. All Medicare Advantage policies have to cover the same services you'd get through Original Medicare (Parts A and B). Plus, most plans offer Part D coverage and extra benefits, such as dental, vision and fitness memberships.
All Medicare Advantage plans have to cover the same addiction services you'd get with regular Medicare. However, you may have to get permission, called a pre-authorization, before you can check into a rehab center. The amount of money you'll have to pay before coverage starts and the portion of your medical bill you're responsible for paying will also depend on your plan details.
Does Medicaid cover inpatient rehab?
Yes, Medicaid covers rehabilitation stays if you're diagnosed with substance use disorders. To get Medicaid in most states, you have to earn roughly less than $22,000 per year (about $44,000 per month for a family of four). Plus, you need to meet several new requirements, such as spending at least 80 hours per month working, volunteering or in a work training program.
The exact coverage you get will depend on your specific needs and the state you live in. But most people can expect at least 30 days of paid inpatient care.
How much does rehab cost with insurance?
The cost of rehab with insurance will depend on your plan's deductible, cost-sharing requirements and annual spending cap.
You'll usually pay up to your plan's deductible, which can differ significantly depending on the type of plan you have. For example, the average deductible for Platinum health insurance is $119, but the average for a Catastrophic plan is $9,199. Keep in mind, higher plan tiers such as Platinum plans often have much higher monthly rates than lower plan tiers.
After meeting your deductible, you'll pay a percentage of your rehab bill, called coinsurance, or a flat rate, called a copay, until you reach your plan's annual spending limit, called an out-of-pocket maximum (OOPM). After you reach your out-of-pocket maximum, your plan will take over and cover all of your remaining medical costs until your plan resets at the start of the next year.
Rehab costs before insurance
Type of treatment | Cost |
|---|---|
| Average cost of drug rehabilitation | $13,745 |
| Outpatient rehab | $5,000 |
| Inpatient rehab | $6,000 |
| Methadone Treatment | $12,183 |
| Non-methadone Outpatient | $2,228 |
| Intensive Outpatient | $4,939 |
| Adolescent Outpatient | $3,278 |
| Adult Residential | $9,766 |
Image you have a Silver health plan with a:
- $4,367 deductible
- 20% cost-sharing you pay after meeting your deductible, called coinsurance
- $8,404 limit on how much you'll spend in a single year, called an out-of-pocket maximum (OOPM)
Here's what you would pay after insurance if you checked into a drug rehab center that charged $13,745 for your entire stay.
What you'll pay for drug rehab with a Silver plan
You pay | Insurance pays | |
|---|---|---|
| Up to your deductible | $4,367 | $0 |
| 20% cost-sharing | $1,876 | $7,502 |
| Total | $6,243 | $7,502 |
What other services does insurance cover?
Most health insurance plans cover other treatments and services related to substance use disorders. These commonly include:
- Detox services help you safely manage the withdrawal process during the early stages of addiction treatment.
- Outpatient addiction treatment lets you get help for your substance use disorder while living at home.
- Counseling and therapy includes individual, group and/or family therapy to help with your mental health.
- Medication-assisted treatment (MAT) combines medications with counseling and behavioral therapies to help you manage your substance use disorder.
- Dual-diagnosis treatment if you're suffering from both a substance use disorder and a mental health problem.
- Aftercare or relapse prevention programs help you stay sober through counseling, community support and other resources.
- Telehealth services give you access to remote therapy and addiction counseling through video or phone calls or text messaging.
- Emergency services help you manage urgent needs, such as an overdose or a sudden medical problem.
- Family or couples therapy can help you repair and manage close relationships.
- Transportation services can take you from your home to a hospital or treatment center.
If you're curious about a specific type of coverage, it's a good idea to call your insurance company or check your plan details. For example, some plans cover alternative forms of medicine, such as acupuncture or art therapy.
Frequently asked questions
Is rehab covered by insurance?
Regular insurance plans have to cover rehab for drugs and alcohol because of changes made by the Affordable Care Act (ACA), also called Obamacare. But the amount of coverage you get will depend on where you live and your plan details.
Why do insurance companies deny rehab?
An insurance company may deny rehab if it believes it isn't necessary. Typically, you'll need to have a diagnosis from a doctor before getting approval from your insurance company, a process called pre-authorization.
How many times will insurance pay for rehab?
The number of days you can spend at a rehab center depends on your health insurance plan details. Plans often limit you to a set number of days per year or for the entire time you have that policy, called a lifetime maximum.
Methodology
Drug rehabilitation cost averages came from the National Center for Drug Abuse Statistics. Information related to Medicaid eligibility requirements came from the Kaiser Family Foundation (KFF), and average deductible and maximum out-of-pocket figures came from the Centers for Medicare and Medicaid (CMS).
Editorial note: The content of this article is based on the author's opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.
