The law requires insurance plans to cover mental health services, including addiction treatment services. Learn the different types of plans and what they cover.
49 percent of drug rehab attendees used private insurance to pay for treatment in 2014.
The Mental Health Parity and Addiction Equity Act of 2008 stipulates that insurance companies cannot discriminate against or deny coverage to individuals with substance use disorders. In addition, the Affordable Care Act of 2010 classified mental health and addiction services as essential health benefits.
This means insurance companies have to treat mental health and substance abuse treatment similar to regular health treatment. Every insurance company has a different coverage plan that can be tailored to the individual’s needs.
Call your insurance provider and request information about mental health and drug addiction treatment. Every insurance provider is required to cover those services under the MHPAEA and the ACA.
It is important to ask about copayments, deductibles and out-of-pocket maximums.
The health marketplace follows the ACA; therefore, all health care plans must comprise essential benefits. Marketplace health plans cannot refuse to cover individuals with pre-existing mental health or substance abuse conditions.
Parity protection rules dictate that the financial, treatment and care management limits for mental and substance use disorders cannot be more than those placed on physical health treatment. The health marketplace insurance plan makes treatment for mental disorders and substance abuse more accessible.
Coverage for treatment of all pre-existing conditions starts on the first day that the individual receives treatment.
Medicaid champions the payment of mental health services in the United States. It also is a major contributor in reimbursing the costs of addiction services. Medicaid varies from state to state, and it offers coverage only to low-income individuals, families, children, pregnant women, the elderly and people with disabilities. However, there are flexible coverage options.
Some states and special cases do not require any copayment or coinsurance, but some states require a premium. The mandatory benefits under Medicaid are required by federal law.
Nearly 12 percent of Medicaid beneficiaries 18 or older have a substance use disorder.
Medicaid coverage includes:
Coverage may start up to three months before the application month and stops at the end of the month when the individual is no longer eligible for Medicaid.
Medicare is available to people 65 or older and people with disabilities. In some cases, it also applies to those with end-stage renal disease. Medicare is divided into four parts: A (hospital insurance), B (medical insurance), C (Medicare Advantage) and D (prescription drugs).
Part A of Medicare covers all services required for the patient to be admitted to a hospital. This can either be in a regular hospital or psychiatric hospital. However, in cases of psychiatric hospitals, Part A only pays for 190 days of inpatient treatment per lifetime.
Part A Does Not Cover:
Part B of Medicare covers mental health services along with treatment with the following professionals:
These medical visits are covered only if the providers are in agreement with Medicare to accept a payment that Medicare deems fair for the service.
Part B covers partial hospitalization in some specific cases. Acting as an alternative to inpatient services, it is provided during the day without the requirement of an overnight stay. Partial hospitalization is covered if it is being provided through a hospital’s outpatient department or community mental health center.
In certain cases, the patient may have coverage for occupational therapy as well as patient training and education about his or her condition.
Similar to outpatient services, Medicare covers partial hospitalization only if the provider is in agreement that it will accept the payment Medicare deems right for the service and not charge the patient the surplus.
Part B Does Not Cover:
Medicare coverage begins on the first day of the month of the individual’s 65th birthday. Enrollment extends from three months prior to three months after the 65th birthday.
Private insurance coverage varies per plan, but all insurance providers are required to cover substance use disorder treatment as an essential health care benefit. The plans are not allowed to deny coverage based on pre-existing mental health conditions, and they must cover preventative services such as depression screening for adults and behavioral assessments for children and adolescents.
Private insurance plans must also offer coverage for SUD services that matches coverage for treatment of other diseases. Many plans require prior authorization for services, but they cannot impose lifetime or annual dollar limits on coverage.
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Tricare is the health care program for members of the U.S. military. It was previously called the Civilian Health and Medical Program of the Uniformed Services. With prior authorization, Tricare covers detox, inpatient rehab, outpatient therapy and family therapy.
Under Tricare, detox is covered for seven days, inpatient rehab is covered for 21 days, 60 outpatient group therapy sessions are covered and 15 outpatient family therapy sessions are covered per benefit period. Tricare covers three substance use disorder treatments per lifetime.