Residential rehab for addiction is usually tens of thousands of pounds/dollars over a 30-day course. When someone is ready to get help, the last thing they want to do is worry about the price and whether or not their insurance will cover it. While they should want to take the time to research their options, many times the question of insurance coverage comes up first. Will it cover treatment? If so, how much? The answers to such questions are incredibly nuanced and vary greatly based on the specific plan.
This guide to what insurance covers, what it does not, and how to navigate the process helps ensure that people know what to expect when setting out to determine what treatment options work best for them without unwarranted financial surprises.
The Mental Health Parity Law
In many countries, including the United States, mental health parity laws suggest that insurance companies must allow for addiction treatment at similar levels to other medical problems; in other words, they cannot limit treatment for substance use more than they would for any other physical health issue.
In reality, however, this makes little difference because insurance companies determine what’s medically necessary at their discretion and that discretion can be ruled quite arbitrarily. Just because someone’s treatment is available does not mean it will be approved by insurance.
What Is Typically Covered
Insurance plans that benefit substance use treatment generally have similar major components covered. Medical detox is almost always covered if medically necessary. Medically necessary means someone requires medical intervention and monitoring to withdraw effectively, which usually requires medication, time in a facility during the acute stage of withdrawal, and daily observation and care.
Inpatient/residential treatment is usually covered for 30 days or less (some plans will cover 60 or 90 days); however, anything longer requires additional authorization and medically necessary coverage. This means that the excess time needs to be assessed through submission for approval. Inpatient treatment generally covers room and board, therapy sessions, group therapy, and any other basic medical care rendered in-house.
Medication-assisted treatment for opioid or alcohol addiction (like Methadone) is generally covered as long as the medication itself is considered approved. There is likely a prior approval component here so that someone seeking a specific type of medication doesn’t necessarily receive something they didn’t want or need.
Where It Gets Confusing
Most insurance plans will require pre-authorization before they cover residential treatment. This means that the assessment for treatment needs to be supplied to the insurance company by either the facility or the individual seeker who calls upon their plan. This includes explaining the severity of addiction, previous attempts to seek treatment, etc.
Thus, the insurance company will use review tools they find appropriate to determine whether residential treatment is medically necessary or whether less intensive levels of care (outpatient) would be feasible. The reviewer might approve everything requested, approve for 5 or 10 days less than requested or deny medical necessity altogether.
The kicker? Getting approval takes time and for someone who is finally ready to get treatment, waiting days for an approval is beyond frustrating – and any delay could have them changing their mind from admission to discharge or relapsing before they get in.
While many facilities offering hollywood rehab will offer intake reviews that also assess insurance coverage before admissions, it helps understanding how long this process might take to set realistic expectations of coverage.
Length Limitations
In addition, even when insurance approves residential treatment, they are unlikely to approve open-ended stays. The general stay approved is 5-7 days for detox and 30 days for residential treatment after this initial time frame is up. If someone needs longer treatment, additional authorizations are required on a weekly basis.
These approvals also require a secondary assessment that proves continued medical necessity – proving that stepping down would be inappropriate but outpatient care would suffice. If insurance determines otherwise – even if the treatment team disagrees – insurance wins.
This means that insurance companies determine how long someone stays at a facility regardless of clinical need; too often people transition out sooner than they are ready simply because that’s when insurance cuts off payment.
Out-of-Network Stipulations
There is a big difference between in-network and out-of-network care coverage. In-network facilities have relationships with insurance companies that pre-determine patient costs; out-of-network do not so there are usually higher out-of-pocket expenses incurred.
Some plans will not provide any coverage if the treatment option is out of network; others will provide limited – as in 50% for out of network versus 80% in-network – with much higher out-of-pocket maximums.
The caveat is that many facilities that have proven quality care are out of network with many plans. Someone can find their ideal fit only to find it’s going to cost exponentially more than anticipated.
What Is Usually Not Covered
Certain aspects are usually not covered by insurance. Luxury options (gourmet meals, recreational options) generally are not covered as these facilities are not there to serve patients’ comfort needs but their medical needs.
Alternative solutions (equine therapy, specialized therapy) might not be covered. While general CBT and DBT methods usually are acceptable and chargeable, anything deemed experimental may be viewed as not medically necessary.
Travel costs are not covered; paying admission for a facility located far away can add substantial cumulative costs.
What’s Not Covered out of Pocket
Even if aspects are covered by insurance, many out-of-pocket expenses accrue anyway. Deductibles must be met first – anywhere from a few hundred dollars to thousands. This means that someone seeking treatment early on in a calendar year with no prior extensive expenses may find themselves meeting their deductible threshold without any other help until they surpass their annual out-of-pocket maximum.
For some people who’ve gotten their deductibles met faster than others (since it’s all relative) – this might be thousands of dollars more than they ever expected regardless of insurance coverage – even $10,000 or more out-of-pocket even after everything else is applied.
Contesting Denials
Insurance companies deny coverage regularly – but these denials can be appealed. If someone believes residential treatment or extended stay recommendations merit specific length approvals but insurance denies this payment approval and decides against covering early discharge as suggested by the treatment team appeal processes exist.
This means determining proper levels of medical appeal with documentation from medical professionals who agree that residential care is medically necessary.
This is hit or miss; however, if someone has sufficient enough reasons to get approval for what was initially denied, often access is granted once again. The problem? Appeals take time and someone on appeal may choose to discharge early so they’re no longer held responsible.
Navigating the System
Knowing specifics about what insurance covers ahead of time can facilitate ease later in coverage expectations. Steps include independently calling the insurance company to verify benefits; the patient (or family member) needs to ask specifically about residential coverage and limitations – to what extent – before admissions processing begins by one facility over another.
Understand pre-authorization processes and wait times before jumping into treatment; many facilities have financial counselors who negotiate coverage steps – from benefits verification to pre-auths – so those who feel overwhelmed shouldn’t go it alone.
If Insurance Isn’t Enough…
If someone’s coverage provides limited substance use coverage, options still exist. Payment plans through sliding scale fee assessment or nonprofit treatment centers charge lower admission costs; even state programs – or those paying through public funding instead of private insurance – often have lower costs than options under non-profit military status.
The Affordable Care Act marketplace plans also include substance use treatment coverage – which could become an option based on open enrollment windows – while many Medicaid programs cover in many states – the facilities available may differ based on payer type but potential exists.
The Bottom Line
Costs include a plethora of anticipated outcomes; successful navigation of any extent of recovery requires knowledge about coverage limits beforehand since there are rarely comprehensive policies available through every step of the process despite all policies being similar with some expected commonalities.
Most licensed providers will have programs with limited setbacks related to accommodations; as long as financial setbacks aren’t complicated with unexpected lengths required due to clinical stabilization needs – and many people never get sponsored stays beyond 30 days since that’s when coverage ends – medically necessary qualifications can help assess additional need.
When all is said and done it’s much easier financially and socially to obtain expenses related to treatment than to continue leading a life plagued by addiction without access to easy compensation – and those who obtain ancillary financing given their credentials will find other financial resources available even when coverage isn’t ideal.
