For many, paying for a drug and alcohol rehab program is the first concern when entering addiction treatment. Having an insurance plan can greatly reduce or completely cover the cost of treatment, whether it’s a group, private or public plan.
While there are other ways to pay for addiction treatment, insurance is the most viable way to cover costs and alleviate financial burdens so individuals and their loved ones can instead focus on the most important factor: finding and entering an excellent addiction treatment program.
Types Of Insurance Plans For Addiction Treatment
If you or a loved one is considering entering an addiction treatment program, you may have already learned that beginning recovery in a reputable rehab center can become pricey. Insurance plans often pay the majority or all of these costs. The amount paid by an insurance carrier depends largely on the individual and their type of plan.
The following are the three most common types of insurance plans which may cover addiction treatment.
Group Insurance Plans
Group insurance plans are those offered to members of a certain group, such as a place of employment (as part of a benefits package) or a member association. For group insurance plans provided through employers, plans are typically offered through an insurance carrier and paid for in part or completely by the employer.
Whether an individual’s group insurance plan covers addiction treatment will depend on their specific plan. Businesses with fewer than 51 employees usually provide plans that cover the same essential health benefits and usually include addiction treatment. Businesses with more than 51 employees may have more flexibility in the amount and types of coverage they provide.
However, due to recently changed guidelines regarding mental health and addiction treatment, most plans provided by major insurance carriers do provide addiction treatment coverage.
Private Insurance Plans
Private insurance plans are those a person seeks independently, whether through an employer or member association or independent of any organization (private purchase). While private insurance plans often incur higher out-of-pocket premiums, these plans typically provide the highest degree of flexibility and control over individual coverage. With private insurance plans, individuals can choose the level of coverage they want, meaning more options for various types of treatments.
In terms of addiction treatment, private plans may allow for more treatment options than others as they may have fewer limitations on whether a patient seeks treatment in or out of their treatment network.
Most private plans fall into one of three categories: HMO plans, PPO plans and Point-of-Service plans.
Health Maintenance Organization (HMO) plans tend to be very specific. Individuals can only seek treatment at drug and alcohol rehab centers or other care providers within their specific network or they will have to pay for a larger portion of addiction treatment costs.
Preferred Provider Organization (PPO) plans are similar to HMO plans, but may provide an even higher level of coverage if treatment is sought in-network. Treatment sought out-of-network may still be covered with this plan, though, at a reduced rate.
Point-of-Service plans may be the most flexible type of insurance plans for addiction treatment in that individuals with this type of plan may be allowed to choose between HMO and PPO services for each treatment need.
Public Insurance Plans
Some individuals may not be able to seek a private insurance plan for a number of reasons but may qualify instead for a public insurance plan, such as Medicaid or Medicare. These plans are state- or government-funded and have eligibility requirements, such as the following:
Medicaid is a state-funded, government-regulated public insurance benefit. Each state is required to provide Medicaid benefits to certain groups, such as low-income families, pregnant women who meet qualifications and any individuals who are receiving Social Security Income (SSI).
Each state may provide additional eligibility requirements regarding who will qualify for Medicaid, so it’s important to check each individual’s state guidelines before ruling out this option.
Medicare works similarly to Medicaid, but eligibility requirements for this federally funded public insurance program are more specific. Groups eligible for Medicare are those who are 65 or older, younger people with disabilities who meet certain requirements and persons with end-stage renal disease, a disease which results in permanent kidney failure.
How Insurance Works For Drug And Alcohol Rehab Programs
The percent of costs paid by an insurance plan will vary according to the insurance carrier, the plan and the treatment center. Most private insurance plans that provide coverage for addiction treatment cover somewhere between 60 and 80 percent of the overall cost.
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However, a few factors may affect the amount of coverage paid by a plan, including:
- Length of treatment: Some insurance plans may only cover short-term treatment (28 or 30 days), while others may cover long-term treatment that’s deemed medically necessary.
- Prior approval: Some insurance carriers may require a person to register their treatment stay with the carrier prior to entering treatment. Patients who bypass this process may not receive coverage at all, so it’s important to find out the requirements of an individual’s specific plan.
- Medical necessity: Many insurance carriers require that addiction treatment be deemed medically necessary before they will cover it. This can mean getting a full clinical assessment from treatment providers or a primary care physician prior to treatment and showing signs of drug or alcohol abuse, addiction or dependence.
- Need for detoxification: Medical necessity often means detoxification is needed, especially if a person is dependent on alcohol, barbiturates, benzodiazepines or opioids. Since it is medically recommended that individuals not be alone during detox dependent on these substances, it is likely that treatment will be covered if detox is necessary.
Because each individual plan varies from the next, it’s important to find out what’s required to secure coverage before heading to treatment. Doing so will provide peace of mind by reducing any financial burden and leaving more room to focus on healing during treatment.
Commonly Accepted Private Insurance Carriers
Most addiction treatment centers accept plans from major insurance carriers. The following are insurance carriers in the U.S. that provide private plans commonly accepted at various drug and alcohol rehab facilities:
- Assurant Health
- Beacon Insurance
- Blue Cross Blue Shield
- Coventry Health
- Golden Rule
- Great-West Healthcare
- Harvard Pilgrim Health Care
- Health Alliance
- Humana Health
- Kaiser Permanente
- Medical Mutual
- Molina Healthcare
- Obamacare (The Affordable Care Act)
- Prominence Health Plan
- UMR Wausau
- United Healthcare
Finding Drug And Alcohol Rehab Centers That Accept My Plan
Each drug and alcohol rehab center has its own list of accepted insurance carriers. Many treatment centers will also arrange payment plans for individuals to help alleviate any remaining financial burden such as co-payments.
Drug and alcohol rehab centers that accept publicly funded insurance plans such as Medicaid may be more restrictive in terms of treatments offered, level of care and facility guidelines that may be affected by state or federal regulations.
No matter the type of insurance plan an individual may have, addiction treatment options are available. Insurance is one of the best ways to secure treatment and enter into a substance-free life.
To learn more about how to pay for addiction treatment, click here.