The following article is provided by the team at Consumer Education team at LendEDU. In the article you will find info which outlines federal and state funded programs, grants, and treatment centers that help those recovering from addiction deal with financial hardship and manage the expense of rehab.
This is not only helpful for individuals in recovery but also for persons assisting their loved ones who are struggling through the process of addiction, rehab and recovery.
Frank Say – U Recover
Financial Assistance for Those Recovering From Addiction
Financial hardship is common among those recovering from addiction, but there are resources that provide financial aid for drug rehab. Individuals in recovery have access to grants, non-profit and private programs, personal funding, and insurance to manage the expense of rehab.
Melissa Horton 03/09/2020
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For people living with addiction, as well as those who care for them, all aspects of life can be affected. Addiction not only creates emotional and physical wounds but can cause other hardships as well.
One significant hurdle faced by those recovering from addiction is financial instability. Substance abuse and drug addiction are expensive on their own, but living with addiction or going through recovery adds further financial challenges.
From rehabilitative therapy to prescription medication and more, the costs of treatment add up quickly – according to U.S News and World Report, the “…annual economic impact from the misuse of prescription drugs, illicit drugs, or alcohol is $442 billion.”
Fortunately, financial aid for drug rehab comes in a variety of forms, from health insurance coverage to state and federal funding. This guide will outline some of the resources designed to provide financial assistance for those recovering from addiction.
In this guide:
- Financial aid for drug rehab
- Health insurance and the ACA
- Government grants for those in recovery
- State-funded and local treatment programs
- VA benefits
- Financial aid directly from treatment centers
- Faith-based rehab programs
- National Foundation for Credit Counseling
- Drug rehab loan
Financial aid for drug rehab
On average, drug rehab costs range from a few to several hundred dollars for a 30-day detox, and between $5,000 and $80,000 for residential recovery treatment. Many individuals in or contemplating recovery may see this as a deterrent to getting the help they need. However, several resources exist that offer financial assistance for drug rehab and associated programs.
Health insurance and the ACA
With the passage of the Affordable Care Act, pre-existing health conditions were no longer an exclusionary tactic for insurance providers. This drastically changed how addiction recovery was viewed under many health insurance plans.
Treatment for addiction is generally considered a covered medical condition. Additionally, The Mental Health Parity and Addiction Equity Act mandates that large group health insurance plans cannot impose less favorable limitations on mental health or substance use disorder treatment benefits than on medical or surgical benefits. The ACA amended this federal law to include individual health insurance coverage, not just large group plans.
Any ACA-compliant health insurance policy may pay between 60% and 90% of the cost of rehabilitation. If you have been denied coverage or experienced benefit limits that are not in compliance with these laws, an appeals process may be necessary.
To appeal a denial of benefits under an ACA health insurance plan, request a fair and full review of the denial with the insurance provider directly or follow your state’s external review process. More information about the appeals process can be found here.
To understand what rehabilitation costs are covered with your specific insurance plan, get in contact with your health insurance provider or check policy limits online.
Government grants for those recovering from addiction
In addition to health insurance coverage through ACA programs, grants may also be available from state and federal governments. Government grants for addiction recovery vary depending on financial circumstances and location, but the resources below are worth evaluating to determine the level of assistance available.
Substance Abuse and Mental Health Services Administration (SAMHSA)
One federal grant for those recovering from addiction is the Substance Abuse and Mental Health Service Administration (SAMHSA) program. Through SAMHSA, block grants are provided to state addiction treatment providers to benefit those in need. Typically, receiving a SAMHSA grant requires meeting specific income requirements or participating in a qualified treatment program through the courts.
To see eligibility information and complete the application process, visit the SAMHSA website.
State-funded and local treatment programs
According to a recent study conducted by Pew Charitable Trusts, a significant portion of spending on drug and alcohol addiction treatment is done by state and local governments. Public assistance in this form often falls under the purview of specific agencies, such as human services or public health departments.
Financial aid for drug rehab may be offered through reduced-cost or no-cost treatment facilities funded by the state. Additionally, assistance in getting back on one’s feet after treatment may also be available. This assistance often comes in the form of low or no-cost sober living for those recovering from addiction.
Disability income can also be an option for those in recovery, although the definition of disability is quite strict. Other financial aid for those in recovery on a state or local level include food stamps, health insurance through Medicaid, employment assistance, or training at little to no cost.
Those recovering from addiction can visit their state or local government’s website or local human services office to determine what programs and partnerships are available.
Another source of drug rehab assistance comes from the US Department of Veterans Affairs. Through the VA, several programs are made available to veterans of the military who are struggling with addiction. Treatment programs, including in-patient and out-patient services, medically-assisted treatment, and residential care, are offered at no cost to qualifying veterans. For help, veterans can speak with their VA healthcare provider, contact a local Vet Center, or call the VA hotline at 1-800-827-1000.
Financial aid directly from treatment centers
There also may also be aid available directly from a treatment center. Because the cost of rehabilitation can be high in private facilities, many offer payment plans and financing to help ease the burden.
After discharge, an individual in recovery may have an option to establish a payment plan that requires installment payments over a period of several months or several years. Interest may or may not be charged, so it is necessary to fully understand the total cost of financing a treatment stay.
You may also be able to find a free treatment center for drug addiction. Typically, centers that do not charge for outpatient or in-patient services for drug rehab have requirements that patients must meet. For instance, the Salvation Army offers little to no-cost drug rehab so long as the patient agrees to work 40 hours per week to help offset the cost. Check with local organizations to see if financing or free treatment is available, but be sure to understand everything that it entails.
Faith-based rehab programs
Many faith-based organizations offer treatment services to those facing addiction. In some cases, sponsorship is available for individuals in the community trying to get out of the throes of addiction. Although the cost of faith-based treatment may not be lower than other treatment centers, this sponsorship can bring down the expense.
Check with local religious organizations or leaders, such as churches, pastors, or priests, to ask about faith-based treatment services available.
National Foundation for Credit Counseling
The National Foundation for Credit Counseling is a national non-profit that offers a variety of financial education and guidance to those struggling to manage their money. This organization does not provide financial assistance for drug rehab directly. However, people suffering from addiction can work with the counselors at the organization to gain a better understanding of what steps are necessary to improve their overall financial lives.
In addition to assistance from treatment centers, the government, or other community-based programs, financial help for drug rehabilitation may come from raising money on your own or with the help of a family member or friend.
Crowdfunding platforms, including GoFundMe and Indiegogo, allow individuals or organizations to raise funds for specific campaigns or initiatives. Crowdfunding campaigns may be used to help fund an individual need – such as covering the cost of drug rehabilitation – with help from friends, family, and local communities easily and quickly.
Drug rehab loan
Drug rehab loans offer another alternative for financial assistance. Although drug rehab loans are not free aid, they can be beneficial in getting the upfront funds needed to pay for treatment.
Loans for addiction treatment must be repaid with interest over the course of months or years, depending on terms, so it is essential to understand this difference from other forms of financial assistance when considering options.
This option should be a last resort and there should be a repayment plan in place before taking one out to ensure you don’t fall behind on payments.
A small number of specialized lenders offer loans to individuals entering or completing treatment programs. The most prominent is My Treatment Lender, which can finance co-pays, out-of-pocket expenses for rehabilitation, or an individual’s stay at an in-patient or residential treatment center.
Specialized lenders have various loan programs available with different costs, repayment terms, and qualification guidelines. Because of these variations, those interested in a specialized loan should evaluate the terms of all available loans before applying and receiving funds.
Finally, personal loans may also be a viable resource for drug rehab assistance. These loans are unsecured, meaning collateral such as a vehicle or home is not necessary to back them. They also offer fixed interest rates and predictable monthly payments that can help make repayment easier in recovery.
Personal loan rates may be higher for individuals with lower credit scores, but many lenders allow for a cosigner. Having a family member or friend with a higher credit score cosign a personal loan application can increase your chances for approval and potentially lower interest rates, which affect the total cost of borrowing.
As with any financing agreement, be sure to read the fine print when getting a personal loan for drug rehab assistance. Take time to understand your obligations as a borrower, as well as the fees you will pay to get the loan and repay it over time.
Author: Melissa Horton Melissa Horton has an MBA in Finance and has worked as a financial professional for the past 13 years, helping clients understand the often complex vehicles available for both lending and investment needs. She is passionate about financial literacy and strives to educate clients and the general public to empower them in making smart financial decisions. Her work has been featured on Investopedia, iGrad, APRFinder, and more.