Learn / How to Pay for Drug and Alcohol Rehab: A Comprehensive Guide
How to Pay for Drug and Alcohol Rehab: A Comprehensive Guide
In This Article
Figuring out how you’ll pay for rehab might seem like a challenge. Finances can be a burden or even a barrier to addiction treatment. But there are many ways to afford the care you need, from health insurance to loans. Learning more about your options can empower you to take the next step on your recovery journey.
Health Insurance Options for Drug and Alcohol Rehab
All health insurance companies must cover addiction treatment1 to some extent. As a result, health insurance is one of the most popular ways to pay for rehab.2 Your exact coverage will depend on several factors, including your insurance company, your specific plan, and your health history.
Common Health Insurance Plans
Health insurance companies typically offer multiple tiers of coverage.3 There are 2 especially common types of insurance plans:
- Health maintenance organization (HMO) plans cover services from providers in your care network.
- Preferred provider organization (PPO) plans have you pay less for providers in your network. Unlike HMOs, PPOs also let you use out-of-network providers for an additional cost.
In-Network vs. Out-Of-Network Providers
A network is a group of providers4 that your insurance company contracts with, who offer their services at a set fee. But you’re not required to choose providers from that network:
- In-network providers will normally accept your insurance to cover addiction treatment. However, your plan may or may not cover the specific therapies you need.
- Out-of-network providers don’t contract with your insurance company. Your plan might not cover any of their services. If you’d like to attend an out-of-network rehab, make sure to ask the admissions team about their pricing options.
Insurance Limitations
Most insurance plans have limitations on how much they’ll pay for treatment.5 This varies based on your exact policy, among other factors. For example, rehab usually costs more when you extend the length of your stay.
Addiction treatment looks different for everyone, and it can require more than one level of care. You might start recovery in a 30-day inpatient rehab before transferring to a 90-day intensive outpatient program (IOP). And your insurance may cover some types of treatment, but not others.
Medicaid and Medicare Coverage for Rehab
You can also pay for rehab using government-funded health insurance, like Medicaid or Medicare:
- Medicaid covers mental health and substance use disorder services for people with low or no income.6 Eligibility depends on factors like income level, household size, and your specific policy.
- Medicare covers substance abuse treatment for people age 65 or older.7
Like private insurance, Medicare and Medicaid coverage varies based on your specific plan. Many of these plans cover a variety of treatment approaches:8
- Inpatient rehab
- Outpatient treatment
- Substance use and mental health screenings
- Mental health care
- Partial hospitalization programs (PHPs)
- Opioid use disorder treatment
- Telehealth
Explore Insurance Accepted Treatment Centers
Employer-Based Benefits and Assistance Programs
If you need financial assistance for rehab, your employer might be able to help. Some companies can help you pay for treatment through benefits, financial assistance programs, and Employee Assistance Programs (EAPs).
Employee Assistance Programs (EAPs)
An EAP9 is a confidential program that provides assessments, counseling, and referrals to help employees work through life challenges, including alcohol and drug addiction. These programs promote health and wellness in the workplace. That means you won’t have to worry about the consequences of seeking treatment or taking time off for rehab. EAPs can offer resources to help you decide on the best path forward, whether or not you need residential care.
Employer-Based Benefits
Many employers offer benefits like private health care. Some companies partner with major health insurance providers like BlueCross BlueShield or Aetna to provide health insurance for their employees. You might find similar options through your employer as you would through private health insurance.
Financing Options and Payment Plans
There are options for paying for rehab without insurance. Maybe you make too much for Medicaid coverage but still can’t afford to pay for private insurance. Some treatment centers can help you navigate these complex situations. Financing and flexible payment options make treatment more accessible.
Income-Based Pricing
In this model, also called sliding scale pricing,10 you can negotiate a fee based on your income. Flexible payment options like these can help you get treatment at a price that works for you.
Payment Plans
Payment plans11 allow you to pay for rehab over time. You’ll pay a fixed monthly amount until you reach the full price of treatment. Some plans might include monthly interest, meaning the total cost will be higher if it takes you longer to pay it off.
Scholarships and Grants for Addiction Treatment
Some non-profit and government organizations offer scholarships and grants for various types of rehab. For example, the Substance Abuse and Mental Health Services Administration (SAMHSA) provides block grants to fund addiction treatment.12 Block grants can supplement other types of payment. If you don’t have insurance or need services your insurance doesn’t cover, you might be a good candidate for a block grant.
Unlike loans, you don’t have to repay any scholarship money you receive. Depending on the amount you’re eligible for, you may be able to partially or fully fund treatment with grants.
Resources For Finding Financial Assistance
With so many different ways to cover the cost of rehab, you can decide which strategy is best for you. What matters most is knowing that you have options. You don’t have to put off getting treatment because of your finances.
If you’d like to pay for rehab with insurance, you can find an in-network program that accepts your current plan.
Frequently Asked Questions About Paying for Rehab
What are the different health insurance plans for drug and alcohol rehab?
Health insurance plans for rehab typically include health maintenance organization (HMO) and preferred provider organization (PPO) options. HMO plans cover services within your care network, while PPO plans offer the flexibility to use out-of-network providers for an additional cost.
Does insurance cover out-of-network rehab providers?
In-network rehab providers generally accept insurance for addiction treatment, but coverage for specific therapies may vary. Out-of-network providers, however, are not contracted with your insurance company, and their services may not be covered by your plan. If you’re considering an out-of-network rehab, inquire about pricing options with your rehab’s admissions team.
What government assistance programs can be used to pay for rehab?
You can use government-funded health insurance programs like Medicaid and Medicare to pay for rehab services. Medicaid covers mental health and substance use disorder services for people with low or no income, while Medicare provides coverage for substance abuse treatment for people aged 65 or older.
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“Substance Abuse and the Affordable Care Act.” The White House, https://obamawhitehouse.archives.gov/node/67255. Accessed 27 June 2023.
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Substance Abuse and Mental Health Services Administration, National Survey of Substance Abuse Treatment Services (N-SSATS): 2020. Data on Substance Abuse Treatment Facilities. Rockville, MD: Substance Abuse and Mental Health Services Administration, 2021.
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“Health Insurance Plan & Network Types: HMOs, PPOs, and More.” HealthCare.Gov, https://www.healthcare.gov/choose-a-plan/plan-types/. Accessed 27 June 2023.
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“What You Should Know About Provider Networks.” Health Insurance Marketplace. https://marketplace.cms.gov/outreach-and-education/what-you-should-know-provider-networks.pdf
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“Annual Limit - Glossary.” HealthCare.Gov, https://www.healthcare.gov/glossary/annual-limit. Accessed 27 June 2023.
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Substance Use Disorders | Medicaid. https://www.medicaid.gov/medicaid/benefits/behavioral-health-services/substance-use-disorders/index.html. Accessed 27 June 2023.
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Mental Health & Substance Use Disorder Services | Medicare. Accessed 27 June 2023.
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Source: National Institute on Drug Abuse; National Institutes of Health; U.S. Department of Health and Human Services.
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“Federal Employee Assistance Programs.” U.S. Office of Personnel Management, https://www.opm.gov/policy-data-oversight/worklife/employee-assistance-programs/. Accessed 27 June 2023.
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Center for Substance Abuse Treatment. A Guide to Substance Abuse Services for Primary Care Clinicians. Rockville (MD): Substance Abuse and Mental Health Services Administration (US); 1997. (Treatment Improvement Protocol (TIP) Series, No. 24.) Chapter 5—Specialized Substance Abuse Treatment Programs. Available from: https://www.ncbi.nlm.nih.gov/books/NBK64815/
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Beetham T, Saloner B, Gaye M, Wakeman SE, Frank RG, Barnett ML. Admission Practices And Cost Of Care For Opioid Use Disorder At Residential Addiction Treatment Programs In The US. Health Aff (Millwood). 2021 Feb;40(2):317-325. doi: 10.1377/hlthaff.2020.00378. PMID: 33523744; PMCID: PMC8638362.
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Substance Abuse and Mental Health Block Grants. 21 Feb. 2014, https://www.samhsa.gov/grants/block-grants.
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