Does Medicaid Cover Drug & Alcohol Rehab?

Updated Mar 24, 2025

Medicaid is a federal- and state-funded program that provides healthcare coverage to people who meet its eligibility requirements. It provides coverage for addiction treatment, but the amount of coverage varies. Learn how Medicaid can help you get treatment for substance use disorder (SUD) below, or contact American Addiction Centers 24/7 at for confidential and free information.

What Is Medicaid?

Medicaid is a federal- and state-funded program that provides healthcare coverage to eligible individuals based on income and other factors. It helps make drug and alcohol rehab more affordable by offering insurance to low-income individuals who qualify. Medicaid substance abuse treatment coverage includes long-term inpatient care, prescription medications, and outpatient services.¹

Eligibility for Medicaid is primarily determined using Modified Adjusted Gross Income (MAGI), which applies to children, pregnant women, and adults. However, individuals over 65 are exempt from MAGI rules.²

If you have both Medicaid and Medicare, Medicare covers services first, with Medicaid covering costs that Medicare does not. Additionally, different Medicaid programs serve different groups. For example, the Medicaid Expansion CHIP provides healthcare coverage for children.³

Who Is Eligible for Medicaid?

The following factors may determine Medicaid eligibility:³

Financial eligibility: You must meet income requirements, typically based on Modified Adjusted Gross Income (MAGI). However, individuals eligible due to disability or those 65 and older may be exempt.
Citizenship and residency: Medicaid recipients must be U.S. citizens or qualified non-citizens and residents of the state where they receive benefits.

Does Medicaid Cover Addiction Treatment?

Yes, Medicaid typically covers at least some portion of drug and alcohol rehab treatment. While state insurance generally provides coverage for most individuals, Medicaid addiction treatment coverage varies based on state policies and individual insurance plans. Medicaid rehab coverage can also differ depending on factors such as your state of residence, whether the treatment facility is in-network or out-of-network, the length of your stay, and your specific insurance plan.

The cost of substance use disorder (SUD) treatment varies from person to person and depends on factors like the rehab center, the type of program attended, and the services received. However, Medicaid addiction treatment coverage is widely accepted at many substance use treatment facilities nationwide. While Medicaid may not always cover the full cost of rehab, it can significantly reduce expenses at approved treatment centers.

Medicaid rehab coverage may include:

Detox services.
Screenings and assessments.
Inpatient and outpatient care.
Mental health and behavioral therapy services.

In most cases, Medicaid recipients do not have a co-payment for drug and alcohol treatment. However, some states require a co-pay, which is capped at a set maximum.

For those without private insurance, Medicaid can be a vital resource, granting access to free or low-cost rehab centers. While treatment costs vary for each individual, Medicaid helps make rehab more affordable for low-income individuals in need of care.

Types of Substance Use Treatment That Medicaid Covers

Most Medicaid plans cover at least some of the costs of drug and alcohol rehab, but the types of treatment and level of care can vary based on individual needs. Common treatment options include:^7,8

Medical detox: Detoxing from drugs and alcohol can be uncomfortable or even life-threatening. Medical detox provides 24/7 medical supervision to keep you as comfortable and safe as possible, and medications may be used to ease withdrawal symptoms.
Inpatient/residential treatment centers: Inpatient rehab requires living onsite at a treatment facility, typically for 15–90 days, depending on the program and individual needs. Medicaid may cover residential treatment, depending on the length and structure of the program.
Partial hospitalization programs (PHPs): PHPs offer structured daytime treatment while allowing you to live at home.
Intensive outpatient programs (IOPs): IOPs provide treatment several evenings a week, allowing you to maintain work or other responsibilities during the day while receiving structured care.
Outpatient treatment: Often used as a step-down after inpatient rehab, outpatient programs offer 10–12 hours of therapy and support per week while you continue living at home.

Many people wonder if inpatient rehab vs. outpatient rehab or another type of treatment is best for them. When you decide to get treatment for drug or alcohol addiction, you can work with your healthcare provider to determine the right continuum of care based on your needs and preferences.

Rehab Centers That Accept Medicaid

Not sure if rehab is covered by your insurance? Here’s how to check:

Call your insurance provider: The number should be on the back of your insurance card. You can also check your explanation of benefits (EOB) for more information.
Contact rehab centers directly: Ask about the types of insurance they accept.
Use our rehab directory: Search nationwide facilities and filter by location, insurance accepted, and more.
Call American Addiction Centers (AAC): Our admissions navigators can quickly verify your insurance coverage at an AAC facility—for free and with no obligation to enter treatment. Take the first step toward treatment today. Call now for a free, confidential insurance verification.

Check Your Medicaid Rehab Coverage

Finding affordable rehab shouldn’t be overwhelming. American Addiction Centers (AAC) is here to help, 24/7. We have top-rated rehab facilities across the U.S. that may accept Medicaid. Even if your insurance is accepted, we can help you explore your options, including low-cost programs, payment plans, and sliding scale fees.

Call now to speak with an admissions navigator for free. There’s no obligation to enter treatment, just expert guidance on:

Finding a rehab center that fits your needs.
Understanding your Medicaid coverage and other payment options.
Verifying your insurance benefits so you know exactly what’s covered.

Your recovery starts with a single call. Don’t wait. Call now.

What Should I Do if Medicaid Won't Cover the Total Cost of Rehab?

If Medicaid doesn’t cover the total cost of treatment, there are several rehab payment options to make rehab more affordable:

Payment plans: Many rehab centers allow you to pay in manageable monthly installments.
Sliding scale fees: Some facilities adjust costs based on your income, ensuring treatment remains within your budget.
Grants and scholarships: Organizations like the Substance Abuse and Mental Health Services Administration (SAMHSA) and individual rehab centers offer financial aid for those who qualify.
Healthcare financing: You may consider a healthcare credit card or a specialized loan for medical expenses.
Personal funds: Savings or a credit card can help cover any remaining costs.

Need help exploring your options? Contact American Addiction Centers (AAC) anytime. Our admissions navigators are available 24/7 to answer your questions and guide you through the rehab admissions process. The call is free and confidential.

Sources

Medicaid.gov. (n.d.) Benefits.
Medicare.gov. (n.d.) Medicaid.
Medicaid.gov. (n.d.) Eligibility.
Medicaid.gov. (n.d.) Behavioral Health Services.
U.S. Department of Health & Human Services. (2021). Mental Health and Substance Use Insurance Help.
Centers for Medicare and Medicaid Services. (2018.) Medicare and Medicaid Basics.
National Institute on Drug Abuse. (2018). Principles of Drug Addiction Treatment: A Research-Based Guide (Third Edition): Types of Treatment Programs.
National Institute on Drug Abuse. (2014). Principles of Adolescent Substance Use Disorder Treatment: A Research-Based Guide: Treatment Settings.