Insurance won’t pay for rehab? What to do and how to pay

By Robby Patrick, President and Founder, The Blackburn Foundation. Published October 23, 2026. Updated November 1, 2026.

If insurance won’t pay for rehab, get the denial in writing and appeal: you have the right to an internal appeal and then an independent external review. While you appeal, check Medicaid (Medi-Cal in California), sliding-fee programs and treatment scholarships. The Blackburn Foundation, a Los Angeles 501(c)(3), can help fund care. Call (888) 305-5422.

What are my rights when a claim is denied?

HealthCare.gov says that if your claim is denied or your coverage is canceled, you have the right to an internal appeal, and you have the right to take your appeal to an independent third party for review. If the case is urgent, your insurance company must speed up the process. Get the decision in writing, and keep copies of every letter, bill and note from each call.

How does an external review work?

• Deadline. You must file a written request for an external review within 4 months after the date you receive a notice or final determination from your insurer.
• Timing. Standard external reviews are decided no later than 45 days after the request is received. Expedited reviews are decided as soon as possible, no later than 72 hours.
• Cost. Free if your insurer uses the HHS-administered federal process. Otherwise the charge cannot be more than $25.
• The result. Your insurer is required by law to accept the external reviewer’s decision.

What if I live in California?

If your health plan is regulated by the California Department of Managed Health Care, you can ask the department for an Independent Medical Review when your plan denies, delays or changes treatment. The department’s form says:

• In most cases you must first complete your plan’s complaint or grievance process. Plans must respond within 30 days, or within 3 days if the problem is an immediate and serious threat to your health.
• You must apply within six months after your plan sends its written response to your appeal.
• The process is free. Reviews are usually decided within 45 days, or within 7 days if the health issue is urgent.
• The DMHC Help Center is at 1-888-466-2219 and dmhc.ca.gov.

Are substance use benefits protected?

HealthCare.gov states that all Marketplace health plans cover mental health and substance use disorder services as essential health benefits, and that parity protections mean these benefits cannot be more restrictive than medical and surgical benefits. Ask your plan to explain, in writing, the reason for a denial and what it would need to approve care.

How do I keep care going while I appeal?

• Check Medicaid. Medicaid.gov describes Medicaid as the single largest payer for mental health services in the United States, with a growing role in paying for substance use disorder services. In California the program is Medi-Cal. In Los Angeles County, see free and low-cost addiction treatment in Los Angeles County.
• Ask about lower-cost options. SAMHSA advises asking each provider whether it has a sliding-fee scale, where the price depends on how much money you make.
• Call SAMHSA’s National Helpline, 1-800-662-4357, a free, confidential referral service open 24 hours a day.
• Apply for a treatment scholarship. The Blackburn Foundation’s fund exists for the gap that opens when insurance or savings run out before care is done. Every scholarship is decided case by case and is open to people across the United States. Apply online.

How can I pay for rehab if my insurance won’t cover it?

Use the appeal to try to get the plan to pay, and line up a second way to pay at the same time so care does not stop.

In Los Angeles? See help paying for rehab in Los Angeles. Looking for scholarship programs? See drug rehab scholarships: who offers them.

What is a step-by-step plan when coverage ends?

1. Get the denial or the end of coverage in writing, with the reason.
2. Ask the treatment team to help with the internal appeal, and ask for an urgent review if waiting could harm health.
3. If the plan still says no, request an external review, or in California an Independent Medical Review if your plan qualifies.
4. At the same time, check Medicaid or Medi-Cal and lower-cost programs.
5. If a gap remains, apply for a treatment scholarship or call (888) 305-5422.

This guide is general information, not medical, legal or financial advice. Talk with a qualified professional about your situation. How we write and source our guides: Editorial Policy.

Sources

1. HealthCare.gov, How to appeal an insurance company decision.
2. HealthCare.gov, External review.
3. California Department of Managed Health Care, Independent Medical Review and Complaint Form.
4. HealthCare.gov, Mental health and substance abuse coverage.
5. Medicaid.gov, Behavioral health services.
6. SAMHSA, Find free or low-cost treatment.
7. SAMHSA, National Helpline, 1-800-662-4357.
8. 988 Suicide and Crisis Lifeline, 988lifeline.org.