According to the Substance Abuse and Mental Health Services Administration (SAMHSA), treatment spending for mental health and substance use disorders is expected to total over $280 billion in 2020. This represents a substantial increase in the expenditures for these issues. These amounts in part reflect the effects of Obamacare or the Affordable Care Act.

Based on projections from SAMHSA, the costs to treat mental health and substance use disorders in the United States are broken down across multiple areas.

Thus, in this time following the Affordable Care Act, Medicaid pays the most significant percentage of expenditures for the coverage of mental health and substance abuse treatment compared to other single providers.

  • Out-of-pocket sources (paid by patients or others) amount to 10 percent of the total cost
  • Private insurance companies pay 25 percent
  • Other private sources pay 2 percent
  • Medicare pays 15 percent
  • Medicaid pays 30 percent
  • Other federal sources pay 5 percent
  • Other state sources pay 13 percent

The Contribution of the Affordable Care Act

The Affordable Care Act passed in 2010 pushed the issue a step further. It classified addiction and mental health services as essential health benefits. This change in the status of substance use disorder treatment meant that insurance companies have to treat addiction in the same manner that they treat other conditions. Thus, the treatment for substance use disorders under a particular plan must provide equivalent coverage to other medical issues.

Plans in the health marketplace follow the mandates of the Affordable Care Act. The act also made it mandatory for individuals to have some form of health insurance, or they would be penalized on their tax returns.

This led to significant increases in enrollment in low-cost programs, like Medicaid, for people who qualify for them.

Is Medicaid the Best Insurance?

Medicaid is a state-funded insurance program that is designed to provide health insurance for individuals who have low-income levels. The level of income that is needed to qualify for Medicaid coverage is determined by each state’s definition of poverty.

Certainly, Medicaid is not the best insurance for many people because they do not fit the established guidelines that would qualify them to receive it. In addition, many quality treatment providers do not accept it, thus limiting provider options significantly.

Medicaid Coverage Includes:

  • Inpatient and outpatient hospital services
  • Mental health services, including substance use disorder treatment
  • Physician services
  • Home health services
  • Transportation services for medical care

Private Insurance Companies

Most people will need to get some type of group coverage or private insurance coverage.

Data Collected in 2017 Indicates That the Following Are the Five Largest Health Insurance Companies in the United States:

  • Anthem (WellPoint Anthem)
  • Aetna
  • Humana
  • Cigna

All forms of private insurance have different types of insurance plans. 

The General Structure of Private Plans

Private insurance plans offer different rates of coverage at different monthly premiums. These plans typically have out-of-pocket costs associated with them. They include:

Health maintenance organization (HMO) plans.

An HMO offers access to certain doctors and hospitals within a specific network that have agreed to lower their rates for members of the plan. Care under an HMO plan is only covered if you see a provider within the HMO network.

Preferred provider organization (PPO) plans.

These provide more flexibility and fewer restrictions on seeing non-network providers. PPO plans will pay some part of the cost if you see a non-network provider. 

Point of service (POS) plans.

A member pays less by using health care providers that belong to a network of the plan. They also require a referral from a primary care doctor to see a specialist.

Exclusive provider organization (EPO) plans.

Services are covered only if one uses providers in the plan’s network (except in emergencies).

The best type of plan depends on a person’s particular situation and needs.

Premiums and Coverage

All insurance plans that are sold on the federal marketplace have some basic coverage for each of the categories of health care services, but a plan will pay for different amounts of coverage and have a specific premium. There are four categories of private insurance plans.

Bronze Plans

Bronze plans have the lowest monthly premiums but typically only pay for about 60 percent of health care costs.

Silver Plans

Silver plans have higher monthly premiums and pay for about 70 percent of health care costs.

Gold Plans

Gold plans have even higher monthly premiums and pay for about 80 percent of health care costs.

Platinum Plans

Platinum plans have the highest monthly premiums and pay for about 90 percent of health care costs.

Not all insurance providers offer all four levels. Again, the best choice depends on the person’s situation.

Which One Is the Best?

The best plan for one person is not the best plan for another. For instance, an individual who does not have too many medical issues may opt for a Bronze plan because they do not utilize health care often, whereas someone with chronic issues, like a chronic substance use disorder, may prefer a higher level plan that covers more of their expenses.

Insurance companies cannot deny health coverage to individuals who have pre-existing conditions (people who already had the condition before they signed up for the insurance plan). 

You should consider how much you can afford monthly for insurance, how much coverage you need, and what type of treatment providers you are able to utilize.

Other Considerations To Get the Best Insurance

Because the treatment coverage for substance abuse must be equivalent to coverage for other types of medical conditions, the Affordable Care Act has made the process of choosing an appropriate insurance provider easier. Even so, it can still be confusing.

Here Are Some Tips To Help You Find the Best Insurance Plan for You:

  • The categories of plans can be used to compare overall costs. Once you choose a category, you can compare plans based on the above factors. You can then ensure you have a plan that covers your needs at a price you can afford.
  • Understand all the out-of-pocket costs that you will have to cover, including premiums, copayments, deductibles, and costs of medicines.
  • Be sure to understand which treatment providers accept the company’s insurance.
  • There are often rules about whether you need specific referrals from a primary care provider to see a specialist like a therapist or addiction medicine physician. Make sure to understand all the rules about referrals to specialists.
  • If possible, try to contact the customer service department of the company you are interested in and speak with the representative about the best type of coverage based on your needs and budget.
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