Insurance-Based vs. Private Pay Drug Rehab: What’s the Difference?

Here’s the truth: Not all drug and alcohol treatment centers are created equal. Unfortunately, a lot of places can slap a big, fat price tag on their services without a strong program of recovery to back it up. That’s not our strategy at Discovery Place. Not only are we an alternative to traditional drug and alcohol treatment centers that works, but we’re also a non-profit. That means we’re here to serve our guests, not cash in on the worst time of their life.

But navigating payment for treatment can be confusing, especially during a very stressful time. So let’s break down insurance-based vs. private pay drug rehab payment options so you can determine the best choice for your situation.

Attending Drug Rehab

Making the decision to seek treatment for drug or alcohol addiction isn’t an easy one. There’s a ton of fear to walk through. Can I actually live life (happily and successfully) without drugs and alcohol? What if treatment doesn’t “work”? How am I going to pay for this? What’s going to happen to me?

We’re all alums of Discovery Place, so we get it. We had those same questions. And while they all get answered along the way, one of the biggest questions our guests and their families encounter first is how much is addiction treatment going to cost and how are we going to pay for it? The good news is that you have options. One of our priorities at Discovery Place is to help people find the best program for their situation, even if that means it isn’t with us. Our admissions team will work with you or your family to connect you to one of our closely vetted list of treatment resources. You don’t have to figure this by yourself. And that means you don’t have to figure out payment on your own either.

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Insurance-Based Drug & Alcohol Treatment

While one of the most affordable ways to pay for treatment is through health insurance, we understand that’s not a reality for a lot of people. For many of our guests, by the time they decide to go to treatment, it may have been years since they last had a job or health insurance. Once we’re under the grip of addiction, it’s easier to go without health insurance than to figure out a way to afford it along with a drug or alcohol habit. 

But this isn’t everyone’s situation. Many people struggling with drug or alcohol addiction still have health insurance, either on their own, through an employer or through their parents. And depending on the type of coverage your health insurance plan offers, some or all of your treatment might be covered. Let’s take a look at how it works.

Private Health Insurance

When you think of private health insurance, you’re probably thinking of some of these major players: Cigna, Aetna, BlueCross BlueShield or Humana. Or maybe even some of these smaller companies coming onto the scene like Oscar or Bright Health. These are the health insurance providers that most businesses go through to provide health insurance to their employees. It’s also where individuals can get coverage if they’re self-employed, work part-time, not covered by their spouse’s insurance, or just don’t have access to health insurance through their employer.

These health insurance companies have a wide range of plans available with varying premiums (how much you pay every month for health insurance), deductibles (how much you’re responsible for before health insurance coverage kicks in), co-pays (the amount you pay at the time of a healthcare service), co-insurance (the percentage you owe for services after your health insurance has paid its part) and out-of-pocket maximums (the most you’ll have to spend on healthcare expenses in a calendar year). It all sounds like a foreign language, right? Totally.

So here’s the long and short of it: If you have private health insurance, chances are very good that some level of substance use disorder (SUD) treatment will be available to you. Depending on your plan and how much you’ve already tapped into your coverage for the year, treatment might be covered at 100% (meaning you pay $0) or only a small fraction of it might be covered. It just depends. Just about every treatment center you call, whether it’s state-run, privately-owned or a non-profit, will have someone you can talk to about your private health insurance plan.

Affordable Care Act

The Affordable Care Act (ACA), also known as Obamacare, was passed in 2010 and gave all Americans access to healthcare coverage. For many people enrolling in an ACA plan, they also get premium tax credits which reduces the cost of their health insurance.

Like private health insurance plans, ACA plans (provided by private insurance companies like Cigna, Aetna, etc.) offer a wide range of coverage. Included in many of these plans is coverage for alcohol and drug treatment. If you’re not sure what your plan covers, call the number on the back of your insurance card. An agent can tell you exactly what’s included.

Medicaid and Medicare

Medicaid and Medicare are federal and state-funded healthcare coverage programs. Coverage and eligibility vary from state to state so you’ll need to find out first if you qualify.

Medicaid is available to qualified low-income individuals and families under the age of 65. Low-income is considered living at or below 133% of the federal poverty line (FPL). As part of the ACA, drug and alcohol treatment is covered, including screenings, intervention, counseling, detox, inpatient treatment, long-term residential treatment, outpatient care and other mental health services. While there may be co-pays associated with some or all of these services, you’ll also have an out-of-pocket maximum. That means there’s a cap on how much you’ll ever be responsible for paying in a year for healthcare services. Not every treatment center accepts Medicaid though. Find out more about Medicaid eligibility.

Medicare is generally only available to individuals age 65 and older though some exceptions exist. Like Medicaid, many services related to the treatment of drug and alcohol dependency are covered. But also like Medicaid, treatment centers don’t have to accept Medicare. Learn more about Medicare eligibility.

If you’ve applied for Medicare of Medicaid in the past and been turned down, try again. Eligibility requirements often change every year and you may qualify now.

Private Pay Drug & Alcohol Treatment

Insurance plans are notoriously confusing. While insurance can make treatment more affordable, it doesn’t necessarily make it easy to understand. The simplest, most straightforward way to pay for treatment is private pay, also called self-pay or cash pay. Private pay drug rehab is exactly what it sounds like: You, or a loved one, pays the full amount for care without any assistance from insurance.

Some treatment centers will offer both insurance-based and private pay options while others offer only private pay. If a treatment center only offers cash pay and you don’t have the funds, you still have options available. Hop on the phone with the treatment center you’re considering and be transparent about your financial situation. Any reputable rehab—one that wants to see you get well and not just take your money—will let you know if they can work with you on the cost of care. If they can’t, they should be able to point you to another treatment center that can accommodate your specific situation.

And don’t forget to ask about:

  • Short-term healthcare financing and/or payment plans (many are interest-free for up to 12-18 months)
  • Scholarships
  • Other organizations that might offer grants or scholarships (think non-profits, churches, private donors and foundations)

Whatever you do, don’t let lack of funds stand between you and the help you need.

The Difference Between Insurance-Based & Private Pay Treatment

While private pay drug rehab is often the quickest, easiest way to get moving on addressing drug and alcohol addiction, it definitely isn’t always the most affordable. If you have health insurance, call your provider and see what your plan covers. Or if you’re employed and feel comfortable talking to your human resources representative about your situation, they should also be able to explain your coverage and benefits. They might also be able to enroll you in an Employee Assistance Program (EAP) which could provide you with different levels of substance abuse treatment. The point is, you have options!

Here’s how insurance-based and private pay options break down:


Inpatient drug and alcohol treatment can range from as little as $0/month to upwards of $40,000/month. Have your health insurance company provide you with a list of treatment centers that are “in-network,” meaning your insurance company will help pay for all or some of it. Remember though, just because a treatment center is in-network doesn’t mean it will be less expensive than other private pay options you have available.

If you’re going to go the private pay route and think you’ll need financial assistance, ask about what modified payment options are available.


If you have insurance, the first thing you need to do is find out what your plan covers. Does it cover detox? Inpatient and outpatient care? Seven days, 14 days, 30 or more days? Depending on where you decide to go for treatment, you might be able to get three months of treatment at one center for the same cost of only two weeks or a month at another.

Asking these questions and making these decisions is stressful. Find someone to help you. If you don’t have someone to help you look at your options, call us. We’ll be glad to talk you through it.


We’re not talking about geography here. We’re talking about “in-network” vs.“out-of-network.” If you choose to go out-of-network, meaning you’re choosing a healthcare provider that doesn’t accept your insurance, then prepare to foot the entire bill for your stay in treatment. If you stay in-network, meaning the treatment center accepts your insurance, then your insurance will agree to pay all or a portion of your care.

If you’re looking for private pay drug rehab, then you don’t need to worry about in-network or out-of-network. Cash pay opens your options up to just about anywhere you can afford.

 Insurance-Based vs. Private Pay: Which Is Right for You?

We’re all about keeping things simple. If you have insurance, at least check in with your insurance company and find out what your options are.

If you don’t have insurance and money isn’t an issue, then you and your loved ones can work together to find the best program for you. (Here are some things to consider when choosing a treatment center.)

If you don’t have insurance and money is an issue, you still have a lot of options. First, see if you’re eligible for any government assistance through Medicaid or Medicare. And if you’re not, there are tons of city- and state-run programs available, as well as grants and scholarships to privately run or non-profit (like Discovery Place) treatment centers.

Discovery Place: A Treatment Alternative

If you call Discovery Place to ask about treatment for drug or alcohol addiction, you won’t be dispatched through a call center or handed over to a sales rep responsible for hitting a monthly quota. Instead, you’ll talk to one of a small handful of guys on our Admissions team. (Did we mention they’re all Discovery Place alumni?)

Discovery Place isn’t your traditional treatment center. We do things differently around here. Here’s how that looks:

·  Nearly every employee is an alumni. We’ve been through one or more of our programs and know firsthand what you and your family are going through.

·  We’re a non-profit. Our mission is to help people get and stay sober, not max out our bottom line.

·  We’re affordable. Bruce Perkins, one of the top professional interventionists in the U.S., says, “For the money, it’s the best program in the country.”

We’ll help you find the right place for you. If we think another program would be a better fit for your situation, we’ll say so. We’re here to help you get the care you need, even if that means it isn’t with us.No matter what your financial situation, if you’re ready to do something about your drug and alcohol addiction, we can help. Our 30-Day Residential Program is where we all began. If you’re not sure it’s right for you, give us a call at 1.800.725.0922. Or send us a message. We’ll walk you through the next steps. We’ve helped thousands of men find a new way to live. So how about it? Are you ready to recover?

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