Cost & insurance
Using private insurance for rehab
Most private health plans cover addiction treatment. The details, like networks, authorizations and your deductible, decide what you actually pay.
PPO vs HMO
| PPO | HMO | |
|---|---|---|
| Network | In-network and out-of-network | Usually in-network only |
| Referral | Rarely needed | Often needed |
| Cost | Higher premiums, more choice | Lower cost, fewer choices |
Authorizations and appeals
Plans usually approve treatment a few days or weeks at a time based on medical necessity. If coverage is denied, ask for the reason in writing, ask the program to request a peer-to-peer review, and appeal. In California you can also request an Independent Medical Review through the Department of Managed Health Care or the Department of Insurance, depending on your plan.
Your rights under parity law
The federal Mental Health Parity and Addiction Equity Act, and California law, generally require health plans to cover substance use treatment on terms no more restrictive than medical or surgical care. That includes co-pays, visit limits and prior authorization rules. If your plan treats addiction care much more strictly than other care, ask why, and consider filing a complaint.
Words to know
| Term | Meaning |
|---|---|
| Deductible | What you pay each year before the plan starts sharing costs |
| Co-insurance | Your percentage of the bill after the deductible, such as 20% |
| Out-of-pocket maximum | The most you pay in a plan year for covered in-network care |
| Prior authorization | Approval from the plan before treatment starts |
| Medical necessity | The plan’s decision that a level of care is clinically needed |
| Balance billing | When an out-of-network provider bills you for what the plan did not pay |
Out-of-network care
Many Orange County residential programs are out-of-network for many plans. If your PPO has out-of-network benefits, you may pay a higher share and could be billed the difference. Ask the program for a written estimate, and ask your plan what it considers the “allowed amount.”
How to file an appeal
- Get the denial in writing, including the reason and the criteria used.
- Ask the program to request a peer-to-peer review with the plan’s doctor.
- File an internal appeal within the plan’s deadline, with a letter from your clinician.
- If denied again, request an Independent Medical Review from the Department of Managed Health Care (HMOs and most plans) or the Department of Insurance (some PPOs).
- For urgent care, ask for an expedited review.
Before you call a program
- Ask for the DHCS license or certification number and check it.
- Ask which levels of care they provide on site.
- Ask what your insurance covers and what you will owe.
- Ask where you would go next when this level of care ends.
Frequently asked questions
Will insurance cover 30 days?
Sometimes. Plans review progress and may approve fewer days. Ask the program how often they request authorizations.
What if my employer plan is self-funded?
Self-funded (ERISA) plans are regulated federally, and appeals go through the plan and the U.S. Department of Labor rather than California regulators. Your HR department can tell you which kind of plan you have.