What Does Medicare Cover for Rehab?
Medicare, a federal health insurance program catering primarily to individuals ages 65 and older, offers a broad range of coverage for various medical services and treatments.[1] While the extent of coverage for rehab will differ depending on the specific Medicare plan, Medicare provides some level of coverage for addiction treatment or rehab services.
Medicare offers coverage for inpatient rehabilitation care under specific circumstances.
Here’s what you can expect:[2-4]
Eligibility
To qualify for Medicare coverage, you must enroll in Medicare Part A and meet specific criteria. This often includes staying in an eligible hospital facility for at least three consecutive days within 30 days before entering a rehabilitation facility.
Inpatient Rehab
Medicare Part A provides coverage for inpatient rehabilitation care at facilities that are identified as Inpatient Rehabilitation Facilities (IRFs). These programs specialize in intensive rehabilitation services for serious illnesses, such as substance use disorders, that require long-term care with 24-hour oversight and supervision.
Covered Services
Medicare covers various services during an IRF stay, such as the cost of semi-private rooms, nursing care services, meals and medications, and rehabilitation therapies and the supplies needed to complete those therapies.
Coverage Limitations
Essentially, if it is a medically necessary service that is required to be stable enough to go home, Medicare covers it. If a service doesn’t meet these criteria, Medicare likely won’t cover the cost. For example, private rooms are not necessary even if they are preferred in an inpatient program, so Medicare will cover the cost of a shared room but not the extra cost of a private room. You’ll be required to pay the difference in cost out of pocket if you want a private room.
Cost Sharing
Medicare Part A coverage for inpatient rehabilitation care involves some level of cost sharing. This may mean that the person in treatment will need to pay a deductible and potentially a coinsurance or copayment amount as well, depending on the length of the stay and other details.
It’s a good idea to review your Medicare plan details to understand your financial obligations before getting started. Ask the treatment facility you choose to check your coverage and outline any out-of-pocket costs you might expect. Confirm this with a Medicare representative to ensure you aren’t surprised by unexpected costs down the road.
Prior Authorization
In certain situations, Medicare may require prior authorization for admission to an IRF. This means that your stay may not be covered if you simply enter treatment on your own accord. You may need a healthcare provider to submit information to Medicare that demonstrates that you meet the necessary criteria for coverage. There is often a requirement that treatment be deemed “medically necessary” by a qualified professional.
Breaking Down Medicare Eligibility
There are different types of Medicare coverage, and almost all can be useful in helping you to pay for some or all of the costs associated with drug addiction treatment. These are the different parts:[1,5,6]
Medicare Part A (Hospital Insurance)
Part A takes care of certain types of hospital care, such as inpatient hospital treatment, hospice care, treatment at a skilled nursing facility, and some types of home healthcare services. It is usually premium-free if you or your spouse have paid Medicare taxes during your working years.
Medicare Part B (Medical Insurance)
Part B covers necessary medical services like doctor visits, outpatient care, preventive services, and certain medical supplies. It requires a monthly premium based on your income and may involve deductibles and coinsurance or copayment costs.
Medicare Part C (Medicare Advantage)
Part C refers to Medicare Advantage plans offered by private insurance companies approved by Medicare. These plans bundle Parts A, B, and often D (prescription drug coverage) into one comprehensive package. Medicare Advantage plans may also provide extra benefits like vision, dental, or wellness programs.
Medicare Part D (Prescription Drug Coverage)
Part D focuses on prescription drug coverage. It assists in paying for prescribed medications, and it is available through private insurance companies contracted with Medicare.
Part D plans come with different coverage options and formularies, and they may involve monthly premiums, deductibles, and copayment or coinsurance costs. This coverage can be especially helpful in the case of alcohol use disorder (AUD) or opioid use disorder (OUD) since medication is often recommended as part of medication-assisted treatment (MAT) programs to manage withdrawal and ongoing recovery.
Does Medicare Cover Other Aspects of Rehab, Like Therapy?
Medicare recognizes the importance of supporting people in all aspects of their recovery journey. For this reason, Medicare covers counseling and therapy as well as the medical costs associated with substance abuse treatment.
For example, Medicare Part B covers outpatient mental health services, individual therapy, group therapy, and family counseling. It also includes mental health discussions during annual wellness visits, promoting holistic well-being.[7]
What Other Options Are Available Once Medicare Stops Covering Rehab?
Like other forms of insurance, Medicare generally covers rehab for set periods, such as a certain number of sessions or days in a treatment facility for a certain period.
For example, Medicare Part A usually covers inpatient rehab stays of up to 60 days at 100% coverage, provided certain criteria are met. You’ll have to pay the deductible amount, which is $1,632 in 2024, but Medicare will cover the rest of the cost.[2]
Once you have exceeded the maximum amount of coverage, you aren’t out of options, however. Longer durations of time in treatment are always recommended for better long-term outcomes, so it’s worth the effort to extend your time in treatment.[8-10]
Here are some options once Medicare stops covering rehab:[11-13]
Private Health Insurance
You can take out a secondary health insurance plan to have supplemental coverage for what Medicare doesn’t cover. If you’re entering rehab, talk to the treatment facility’s insurance coordinator about what type of plan might most benefit your situation. Be aware that there may be a waiting period before certain types of coverage kick in.
Medicaid
You may qualify for both Medicare and Medicaid. Once you use up your Medicare coverage, Medicaid might cover some additional rehab costs.
Sliding Scale Payments
Some rehab facilities offer sliding scale payments, meaning that people with lower income levels pay lower fees for services.
Financing Options
Many addiction treatment centers offer financing plans where you don’t pay anything while you are in treatment. Once you exit treatment, you pay a reasonable monthly fee rather than owing a large chunk of money for your care. Oftentimes, these financing options offer very low-interest rates.
Medicare Rehab Coverage FAQs
Medicare Part A will usually cover up to 60 days of inpatient rehab per benefit period, with a $1,632 deductible as of 2024. For days 61 to 90, patients will pay a $400 copay per day.
For outpatient rehab services, Medicare Part B generally covers a certain number of visits per year. You will need a doctor’s referral for these services just as you would for inpatient care.
Medicare Advantage plans, offered by private insurance companies, provide the same coverage as the original Medicare plans, but the specifics can vary, so check your plan’s details for coverage limits.
Medicare can cover alcohol rehab services based on the type of Medicare plan you have. Here is a summary of how Medicare covers alcohol rehab:[14]
Medicare Part A: Inpatient alcohol rehab services in approved facilities may be covered if the treatment is medically necessary and other, less intensive options have been pursued without success.
Medicare Part B: Outpatient services like counseling and therapy for alcohol and drug rehab are typically covered.
Medicare Advantage (Part C): These plans offer coverage similar to original Medicare, with potential additional benefits for alcohol rehab.
Coverage details vary, so it’s best to refer to official Medicare resources or contact Medicare directly for specific information regarding alcohol rehab coverage under your plan.
Medicare can cover rehab services following a hospital stay if it is medically necessary.
Medicare Part A: If you were admitted to a hospital for at least three consecutive days, Medicare Part A can cover rehab in a skilled nursing facility.
Medicare Part B: Outpatient rehab services are covered under this option. This can be beneficial for people who require ongoing rehab after inpatient care but do not need to be in a skilled nursing facility.
Each person’s journey with Medicare and rehab is divided into benefit periods, which start when admitted as an inpatient in a hospital or skilled nursing facility (SNF). A benefit period concludes when there is no inpatient hospital care or up to 100 days of skilled care in an SNF for 60 consecutive days.
If hospital or SNF care is required after a benefit period ends, a new one commences. It’s important to note that an inpatient hospital deductible is applicable for each benefit period, but there is no predetermined limit to the number of benefit periods one can have.[2] Likewise, there is no lifetime limit on the maximum amount Medicare will pay for your care.[15]
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- Inpatient rehabilitation care. Medicare. Accessed October 18, 2023.
- Rehabilitation. U.S. National Library of Medicine. Published October 2019. Accessed October 18, 2023.
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- Parts of Medicare. Medicare. Accessed October 18, 2023.
- What Medicare Part D drug plans cover. Medicare. Accessed October 18, 2023.
- Mental health care (Outpatient). Medicare. Accessed October 18, 2023.
- Pathways to long-term recovery: A preliminary investigation. Laudet AB, Savage R, Mahmood D.Journal of Psychoactive Drugs. 2002;34(3):305-311.
- A systematic review and meta-analysis of the efficacy of the long-term treatment and support of substance use disorders. Beaulieu M, Tremblay J, Baudry C, Pearson J, Bertrand K. Social Science & Medicine. 2021;285:114289.
- Addiction treatment aftercare outcome study. Mohammad A, Irizarry KJ, Shub RN, Sarkar A. Open Journal of Psychiatry. 2017;07(01):51-60.
- How Part D works with other insurance. Medicare. Accessed October 18, 2023.
- Insurance coverage, costs, and barriers to care for outpatient musculoskeletal therapy and rehabilitation services. Carvalho E, Bettger JP, Goode AP.North Carolina Medical Journal. 2017;78(5):312-314.
- Access to care, cost of care, and satisfaction with care among adults with private and public health insurance in the U.S. Wray CM, Khare M, Keyhani S. JAMA Network Open. 2021;4(6):e2110275.
- Alcohol misuse screenings & counseling. Medicare. Accessed October 18, 2023.
- Barry P. Medicare coverage expense limits - Medicare benefits. AARP. Accessed October 18, 2023.
