Will My Insurance Cover Drug Rehab?

Many people cite the cost of treatment as a reason they can’t go to drug rehab, but in many cases, there are insurance benefits that could help them afford treatment. Even when the benefits are there, they aren’t always easy to understand or access without the guidance of an experienced treatment facility. Working with insurance companies can be extremely challenging. Here are a few commonly asked questions about using insurance for drug rehab:

Is drug rehab covered by my plan?

In order for drug rehab expenses to be covered by insurance, you typically must have coverage for behavioral or mental health. There are limited exceptions for aspects of treatment that are classified as medical costs, which may be covered by most insurance policies.

What is the difference between an HMO and a PPO?

Insurance works differently depending whether you have an HMO or PPO. If you have an HMO, you have to go to a drug rehab program that is contracted with your insurance company. There are typically no out-of-network benefits.

If you have a PPO, your policy will give you more options because you likely have in-network and out-of-network benefits. Even out-of-network benefits can offset the cost of treatment significantly.

What is medical necessity?

Let’s illustrate this with a common scenario: An individual in need of treatment (or their loved one) calls their insurance company and is told that they have a behavioral health care benefit that covers 80 percent of addiction treatment based on medical necessity. The individual breathes a sigh of relief, believing they will be responsible for just 20 percent of their 30-plus days in drug rehab.

Unfortunately, it is not so simple. The key is understanding what “medical necessity” means, which varies depending on the needs and background of each individual. Without a thorough assessment from a treatment facility, it is impossible to know if you meet the medical criteria that would qualify you for insurance coverage for a specific level of care (e.g., detox, outpatient or residential) and a certain length of stay.

Because of the complexities of the insurance process, it is important to work with a treatment center that has an experienced insurance and utilization review team that can help you understand and maximize your benefits. You may have coverage you didn’t even know you had.

What is typically covered by insurance?

The type of coverage depends on the services you need. For example, is drug detox needed? Have you tried outpatient treatment or other forms of care in the past? Do you have co-occurring disorders such as depression or anxiety?

Depending on your individual needs and the severity of your illness(es), your insurance may cover all or part of detox, outpatient care, partial hospitalization or residential treatment. The insurance plan may also set a percentage of the cost that will be covered, such as 80/20 or 60/40 (meaning the insurance company pays 80 or 60 percent of the cost, and the patient pays 20 or 40 percent).

As it relates to behavioral health, insurance is extremely complicated. Because benefits vary from employer to employer and state to state, there is no typical case. Some policies are comprehensive and offset the costs of treatment significantly, while others cover only a small amount. For an estimate of coverage, it’s important to let the treatment facility explore all of your options.

Why do I need an assessment?

An assessment, which is performed by a drug rehab program, is required to determine the appropriate level of care and the type of treatment your insurance company will authorize. This assessment may occur prior to or during admission, depending on the facility and your specific situation.

What is a single-case agreement?

In certain cases, your insurance company will work with the treatment center on a single-case agreement. This is an exception granted on a case-by-case basis that allows individuals who need services that are not available within a contracted network to receive care from an out-of-network provider. The treatment center can help you determine if your policy allows for a single-case agreement and negotiate with your insurance company on your behalf.

What if I don’t have insurance?

If you don’t have health insurance, the most important step you can take before calling a treatment center is to understand your budget. Find out whether there are resources available to you through family or friends, or if you can borrow against your 401k or home equity line of credit. Explore all of your financial resources so that when you call a treatment center, the advisors can help you find a program that meets your needs while getting you the most effective and affordable treatment available.

Can a treatment center help me access my health benefits?

Yes! In the area of behavioral health, you should not try to sort out the confusing terms and conditions of your insurance policy on your own. Treatment centers are experts at working with insurance companies. They have insurance and utilization review teams that fight to get patients as much of their benefit as possible, and have been successful in getting insurance companies to help offset the cost of treatment.

Most treatment centers offer free benefits checks. To call for a benefit check, you typically need the following information:

• Subscriber’s name, address, date of birth and social security number

• Patient’s name, address, date of birth and social security number

• The policy number and group number on your insurance card

• The phone number from the back of your insurance card

Questions about insurance are difficult to answer without understanding the specific coverage, personal history and treatment needs of each individual. Most treatment centers will provide a free benefits check and/or assessment and work with your insurance to make sure you get the maximum benefits available to you. If a particular treatment facility is not covered by your insurance, they may be able to refer you to reputable in-network providers.