In This Article
What are Medicaid and Medicare?
Medicaid and Medicare are government-funded health insurance programs designed to help certain populations get the healthcare they need. There are both state and federally funded programs.
People who qualify for these programs are eligible for free or low-cost medical care, including drug and alcohol addiction treatment.
Some people qualify for both Medicaid, a disability and income-based program, and Medicare, an age-based program.
If you or a loved one needs addiction treatment and you don’t know if you qualify for either program, an addiction treatment specialist can help you evaluate your options.
Can I Use Medicaid to Pay for Rehab?
Yes. People who qualify for Medicaid receive financial support for alcohol and drug use treatment. The amount someone receives varies from state to state.
Anyone with health insurance coverage, including Medicaid, receives support for substance use disorders because of the Mental Health Parity and Addiction Equity Act.
This law makes it illegal for health insurance providers to discriminate based on a patient’s need for behavioral health treatment. Under the law, Medicaid must provide coverage that is no less restrictive than that for other medical conditions.
What Does Medicaid Cover?
Medicaid covers all or part of many services offered by addiction treatment programs. This includes:
- Maintenance and relapse prevention
- Addiction medications
- Family counseling
- Inpatient care
- Long-term residential treatment
- Outpatient care
- Other mental health services
The federal Medicaid program does not charge co-payments. State programs can — but they regulate out-of-pocket limits.
In addition to basic addiction treatment, Medicaid also covers mental health services. Mental health care is an important part of addiction recovery.
The Substance Use Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT) expands addiction recovery treatment options to include:
- Peer Support
- Social Services
- Other relevant SUD treatment
Who is Eligible for Medicaid?
Medicaid applicants must meet at least one of the following qualifications:
- Under 19 or over 65 years old
- A parent
- Within a specific income bracket
Some states automatically provide Medicaid coverage to all residents under a certain income level. Anyone receiving Supplemental Security Income (SSI) automatically qualifies for Medicaid coverage.
Under the Affordable Care Act (ACA), someone must earn less than 133 percent above the federal poverty level to qualify for federal Medicaid coverage.
States with expanded Medicaid benefits under the ACA offer Medicaid coverage to people earning 138 percent above the poverty level.
In general, Medicaid qualifications are based on financial need, medical necessity, and age.
Can I Use Medicare to Pay for Rehab?
Yes. A doctor has to deem inpatient addiction rehabilitation medically necessary to qualify for coverage.
Medicare recipients must also receive care from a Medicare-approved rehab facility. In some cases, this requires a three-day hospital stay before admission.
What Does Medicare Cover?
Medicare covers the cost of inpatient and outpatient alcohol and drug use rehabilitation. This includes medications, counseling, and therapy.
Health coverage through Medicare covers rehab services such as outpatient and inpatient treatment.
Who is Eligible for Medicare?
Medicare is an age-based program. You must be 65 years old or older to qualify (unless you’re on disability).
The cost of Medicare coverage is based on the recipient’s income.
Are MAT Medications Covered by Medicaid & Medicare?
Yes, both programs cover the cost of addiction treatment medications.
The federal programs were expanded in 2020 to increase access to MAT for people with opioid addiction. State programs must also provide Medicaid coverage for certain drugs.
Some of the medications covered by Medicaid and Medicare include:
- Methadone: An opioid agonist that reduces withdrawal symptoms and cravings.
- Buprenorphine: A partial opioid agonist that is less potent than methadone but still helps with withdrawal symptoms and drug cravings.
- Naltrexone: An opioid antagonist that blocks the euphoric effects of opioid drugs from occurring.
Both Medicaid and Medicare pays for MAT medications and treatment.
Can I Use Other Insurance?
In some cases, yes, you can combine Medicare and/or Medicaid with private insurance coverage.
Some people automatically qualify for Medicare Parts A (hospital insurance coverage) and B (medical insurance) when they receive Social Security or Railroad Retirement Board benefits for more than four months before their 65th birthday, with certain exceptions.
They can enroll in a Medicare supplement plan or Medicare Advantage Plan for help with the cost of prescription medications.
The same is true for people under 65 who receive Social Security disability benefits or Railroad Retirement Board benefits for at least two years.
Anyone who does not automatically qualify for Medicare due to the above circumstances must apply for Medicare benefits during the seven-month enrollment window. People who fail to apply during this window risk a lapse in coverage and/or penalties.
The General Enrollment Period begins from January 1st to March 31st every year. The benefit period of coverage begins in July of the year you apply.
Keep in mind: private insurers within the ACA Marketplace cannot provide insurance to people who have Medicare. Once you sign up for Medicare, the Marketplace is no longer an option for private insurance unless you’re paying a premium for Medicare Part A. However, you must drop Medicare for the Marketplace plan.
Coordination of benefits rules determine which plan is primary and which is secondary when someone has both Medicare and non-Marketplace private insurance coverage.
The primary plan pays claims first. Any cost leftover after primary coverage pays is covered in part or in full by the secondary coverage.
For example, Medicare coverage is secondary for someone over 65 who has chosen to continue working and also has employer-provided insurance coverage from an employer with 20 or more employees.
What if I Don't Have Insurance?
There are other ways to pay for rehabilitation services and addiction treatment if you don’t qualify for Medicaid or Medicare. However, you’re supposed to have insurance or risk being fined.
Some facilities offer financing options so patients don’t need to pay for the full amount of a program upfront.
In most cases, the initial payment isn’t due until after completing treatment. There might also be a grace period of a few months.
2. Scholarships and Grants
Some programs offer or accept scholarships or grant money to pay for treatment. One of the most commonly used grants available is from the Substance Abuse and Mental Health Services Administration (SAMHSA).
3. Sliding Scale
Some facilities base their fees on the financial ability of patients. This means someone earning less pays less for care than someone with a higher income.
4. Subsidized Coverage
The Affordable Care Act offers insurance coverage to people who are unable to afford private insurance and who don’t qualify for Medicare or Medicaid.
5. Private Funding
Some people choose to use their savings or ask friends or family for financial support to attend rehab. You might also consider a “Go Fund Me” or other crowd-funding option to help a loved one or yourself pay for rehab.
Recent laws have made it more affordable than ever to get the addiction treatment you need.
Speak to an addictions specialist today to learn more about making addiction rehab an affordable option for you or a loved one.