Financial Assistance & Government-Funded Drug & Alcohol Rehab

The high costs associated with substance abuse treatment, especially with detoxification and rehabilitation programs that provide higher levels of care and last longer, often prevent individuals from seeking the treatment they need.1 According to a 2015 report, only 10% of individuals in the U.S. who need substance abuse treatment are getting it.2

To combat substance abuse nationwide, it is of essential importance to facilitate access to substance abuse treatment and make resources easier to find for treatment-seeking individuals who find the cost to be the prohibitive factor.1 So, what financial assistance for drug rehab is currently available from public sources?

How To Get Financial Aid for Drug and Alcohol Rehab? 

Public assistance or government-funded drug addiction treatment is one option available to low-income individuals who do not have the means to pay for treatment costs and need help paying for rehab. In addition to free rehab, non-profit rehab, and low-cost treatment facilities across the country, there are facilities that accept Medicaid or private insurance.1

Additionally, each state has rehabilitation funding set aside to help uninsured or underinsured treatment-seekers. There are also local government-funded options: municipality or county-funded alcohol and drug addiction treatment programs.2

Efforts are being made to educate treatment-seeking individuals and those in their surroundings on addiction and available treatment options and provide them with sufficient resources to make an informed decision and find affordable treatment.3 The Mental Health Parity and Addiction Equity Act (MHPAEA) of 2008 has made coverage for mental and/or substance use treatment and services a legal requirement for health insurance companies and group health plans, and it will hopefully improve the current state of affairs.3



Preventing Drug and Alcohol Abuse 

It is equally important to facilitate access to services that focus on timely preventions, early screening and treatment referrals, and brief interventions, such as Medicare’s SBIRT services. This is important for individuals struggling with the early onset of substance abuse as it can help prevent the problem from escalating.3

These services are intended for those who do not meet the criteria to be diagnosed with substance use disorder (SUD).3 SBIRT services may prevent these individuals from sinking into addiction, the most severe stage of the disorder, and developing health, financial and social issues that typically accompany it, affecting both the individual and the society at large.3

The History of Government-funded Drug Rehabs

Alcoholism treatment in the United States has a long history, whereas drug abuse took longer to be accepted as a legitimate public health concern at the federal level.4 While there were many community-based programs and initiatives, it took a long period of time to address substance abuse as a matter of national priority:5

  • It was the year 1935 that marked the beginning of federal involvement in addiction research and addiction treatment, which was when the first federal “narcotics farm” opens in Lexington, Kentucky.
  • In the early 1960s, several states initiated programs for narcotic addicts, which paved the way for the development of other community-based treatment programs.
  • Federal funding for specific programs for the treatment of mental conditions, alcoholism, and addiction gradually increased throughout the 1960s.
  • As the insurance industry began to recognize and reimburse the treatment of alcoholism, the number of hospital-based and private inpatient treatment programs began to increase dramatically.
  • The 1966 Narcotic Addict Rehabilitation Act (NARA) raised federal involvement in supporting local substance addiction treatment efforts to a new level.
  • The mid-1970s was a time when alcoholism and drug abuse treatment has become administratively and clinically merged through an integrated approach to treatment at the state and local levels, and it remained so during the following decade. However, nationwide programs were yet to adopt the same approach.
  • Federal support for addiction treatment was further expanded in the following period. The Drug Abuse Office and Treatment Act of 1972 had established the Special Action Office for Drug Abuse Prevention (SAODAP) in the Executive Office of the President, which provided the first federal funding of drug abuse, and it was also the first step toward creating The National Institute on Drug Abuse (NIDA).4
  • The 1981 zero-tolerance anti-drug campaign reduced federal support for drug abuse and addiction treatment.
  • The 1982 federal Block Grant Program transferred responsibility for the delivery of treatment and prevention services to the states which are assigned funding to distribute to various programs in the state, with eligibility criteria determined by each state.
  • Between 1982 and 1992, the number of women-only treatment units triple as the National Institute on Alcohol Abuse and Alcoholism (NIAAA) and NIDA focus attention on the special needs of addicted women.
  • In the year 1991, The American Society of Addiction Medicine (ASAM) issued Patient Placement Criteria for the Treatment of Psychoactive Substance Use Disorders which marked this major shift in approach to SUD treatment.
  • Innovations such as the 2010 Health Care Reform (the Patient Protection and Affordable Care Act of 2010, “ACA”) also stand to increase substance abuse treatment demand and availability, improve access to these services and enhance their effectiveness.6

How To Get Funding for Drug Rehab: Current State of Affairs 

In the United States, more than 14,500 specialized drug treatment facilities provide services to persons with substance use disorders, including but not limited to:6

  • Rehabilitation.
  • Medication.
  • Behavioral therapy.
  • Counseling.
  • Case Management.

The main source of funding for drug treatment comes from local, state, and federal governments.6 Federal financial aid is made available through grants, scholarships, insurance coverage, and other options.6 Private insurance and group health plans also offer some coverage for addiction treatment and its medical consequences.6


What Are the Government Assisted Programs for Substance Abuse Treatment? 

State and federal funding is used to support various inpatient and outpatient addiction treatment programs and counseling:8

Before being admitted into a private or public treatment program, treatment-seekers are evaluated to determine their treatment plan and assess optimal treatment duration.6

Levels of Care at Government-Funded Rehab

The single standardized treatment approach has been replaced with a tailored approach to treatment and a “levels of care” system in both the private and the public sector.7 However, some issues persist: insufficient coverage or lack of coverage for substance abuse treatment has reduced the number and limited the impact of current operational programs.6 On average, managed care has reduced the average duration of stays in treatment facilities, which can have a negative impact on treatment outcome.6

Likewise, certain programs may lack financial and personnel resources to adopt the more innovative approaches to treatment.7

Government Assistance For Substance Abuse Programs

Substance abuse treatment in the United States is financed through a diverse set of public and private sources. Funding comes mainly from the public sector, as public sources account for 64% of all substance abuse treatment spending.9

Medicare Coverage for Rehab 

Medicare offers coverage for SUD treatment in both inpatient and outpatient settings if the provider states that these services are a medical necessity and sets up a care plan, as long as the service provider, facility, or program is Medicare-approved.10

Medicare also offers Screening, Brief Intervention, and Referral to Treatment (SBIRT) Services intended for individuals who do not meet the criteria for an SUD diagnosis.3

Medicaid Pay for Rehab 

Medicaid follows guidelines set by the federal government, but specific eligibility requirements are defined on a state-by-state basis. This further defines reimbursement rates and covered services and makes funding for substance abuse treatment of eligible individuals an optional benefit at the state’s discretion.11

Grants for Alcohol Rehab 

The Substance Abuse Prevention and Treatment Block Grant (SABG) focuses on substance abuse prevention activities and substance abuse treatment and recovery support services, with a special focus on intravenous users, pregnant women and mothers with dependent children.12 This funding will cover all MAT medications for Opioid Use Disorder.13

Scholarships for Rehab 

Scholarships are available to underinsured individuals, individuals who have exhausted other options, including Medicaid, and individuals who require special treatment which is not covered by insurance, provided they demonstrate commitment to recovery.14

How to Find Government-Funded Rehab Near Me?

Treatment-seeking individuals can easily search government-funded treatment facilities and programs closest to them and verify their insurance coverage if any.1

While the major source of public funding for substance abuse treatment comes through the Single State Agencies (SSAs) that manage the publicly-funded addiction treatment, prevention, and recovery service system, the following major public funding sources, some intended for specific populations or specific types of services, may also be of use to treatment programs:15

  • Substance Abuse Prevention and Treatment (SAPT) Block Grant
  • Medicaid
  • Welfare-To-Work Initiatives
  • Treatment and Prevention in Public Housing
  • Vocational Rehabilitation
  • Child Protective Services
  • Expanded Health Insurance Coverage for Children
  • Social Services Block Grant
  • Criminal Justice
  • Empowerment Zones and Enterprise Communities
  • Community Development/ Block Grants

Frequently Asked Questions