Alcohol Addiction and Rehab: How Private Health Insurance Can Help

Alcohol addiction can have profound impacts on individuals, families, and communities. Acknowledging the need for treatment and seeking help is a significant first step toward recovery—but with the rising costs of rehab programs, accessing the right level of support can feel daunting.

The right private health insurance policy can make accessing alcohol rehab treatments more manageable, both financially and logistically. Whether you're looking for inpatient detox programs, outpatient counselling, or tailored treatment plans, understanding your options for cover ensures you can focus on recovery, not the bills.

What is Alcohol Addiction Rehab?

Alcohol addiction rehab refers to the medical and psychological support systems designed to treat alcoholism and its related effects. These programs aim to help individuals overcome physical dependence, address underlying mental health issues, and develop new coping strategies.

How much does rehab cost in Australia?

Detox, often the first step in recovery, can also be costly without insurance. In-patient rehab, providing round-the-clock care, is another expensive treatment option. Having the right insurance can help lift some of these financial pressures off the shoulders of the addict, and their friends and family.

Some indicative costs are listed below:

• Outpatient detox: $1,000 - $1,500

• Inpatient rehab (includes detox):

  • 30-day programs: $6,000 - $20,000

  • 60- or 90-day programs: $12,000 - $60,000

• Outpatient rehab (3 months): $5,000 - $10,000

• Medications: e.g. methadone treatment for heroin addiction: approx. $4,700 per year

Source: The Addiction Centre

Common Stages of Rehab:

Detoxification (Detox): A supervised process where the body eliminates alcohol. Detox can cause withdrawal symptoms and often requires medical assistance.

Inpatient Rehabilitation: Residential programs offering 24/7 care, including therapy, group sessions, and medical supervision.

Outpatient Counselling: Flexible treatment allowing individuals to live at home while attending therapy and counselling sessions.

Aftercare Support: Long-term support networks such as Alcoholics Anonymous (AA) or one-on-one consultations to prevent relapse.

Does Medicare Cover Rehab Services?

Medicare offers limited coverage for addiction treatments, depending on the type and location of your care.

Public Hospital Detox Programs: Medicare covers publicly funded detox and rehab treatments, but availability is limited, and waitlists can be long.

Outpatient Counselling: Medicare rebates may apply through mental health care plans provided by GPs. This rebate covers part of the cost for counselling or psychologist sessions.

Specialist Consultations: A Medicare rebate is available for some addiction specialists, but you’ll need a GP referral to qualify.

However, comprehensive care—such as inpatient programs at private facilities or tailored rehab treatments—generally isn’t covered under Medicare.

How Does Private Health Insurance Cover Rehab for Alcohol Addiction?

Private health insurance can make accessing rehab services more straightforward and affordable by covering treatments that Medicare doesn’t—especially for inpatient care at private facilities.

What’s Covered by Private Health Insurance?

Inpatient Admissions: Private rehab facilities offering detox, counselling, and other treatments in a supervised environment.

Doctor and Specialist Fees: Fees for consultations with addiction specialists or psychiatrists while in a recognised rehab. facility.

Hospital Accommodation: The cost of staying in a private hospital or treatment centre.

Mental Health Programs: Many policies include counselling and therapy for co-occurring mental health issues, such as anxiety or depression.

Note: Coverage varies, and not all treatments (e.g., ongoing aftercare or outpatient services) may be included in your policy.

What Type of Policy Do You Need for Rehab Cover?

To access private in-patient alcohol addiction treatment, you typically need a Gold-tier hospital policy or a Silver Plus policy. These policies include cover for:

• Psychiatric Services

• Rehabilitation Services

• Mental Health Treatments

Gold-tier policies offer comprehensive coverage, while suitable Silver Plus policies include private mental health and rehab coverage at a more affordable price point. It’s essential to check with your insurer to ensure your needs are covered.

Waiting Periods for Rehab Services

Most private health insurance policies have a standard two-month waiting period for psychiatric and rehab-related services.

If you don’t already have cover, you’ll need to wait until this period is served before accessing benefits.

Switching providers? You might not need to re-serve waiting periods if your previous policy included similar cover.

Pro Tip: Health insurers are required to waive waiting periods for psychiatric treatments if you’re upgrading from a lower-tier policy to access immediate care.

How Much Does Alcohol Rehab Cost?

Without insurance, alcohol rehab is often expensive, particularly for private inpatient treatments. Here’s a general guide to costs:

Inpatient Rehab (30-day stay) - $10,000–$30,000

Detox Program (7–10 days) - $3,000–$5,000

Outpatient Counselling (per session) - $150–$300 per session

Group Therapy Programs - $50–$200 per session

These costs can escalate for longer stays, additional medical care, or personalised treatment plans. With private health insurance, you reduce or eliminate many of these out-of-pocket expenses—particularly for inpatient programs.

Why Compare Policies for Rehab Coverage?

Not all private health insurance policies are created equal, particularly when it comes to mental health and addiction treatments. Comparing policies helps you:

Avoid Surprises: Ensure inpatient rehab and detox are covered under your policy.

Minimise Out-of-Pocket Costs: Some funds have agreements with private rehab facilities, reducing gap fees for treatments.

Access the Right Providers: Private health insurance lets you choose the facility and specialists that align with your treatment goals.

Comparing different insurers ensures you balance affordability with comprehensive care tailored to your needs.

Taking the Next Step

Alcohol addiction recovery requires courage, support, and the right resources to see you through. By securing private health insurance tailored to your needs, you’ll gain access to quality rehab services while reducing the financial burden of treatment.

At Compare Club, we specialise in helping Australians find great value and appropriate health insurance policies—especially for mental health and rehab services. Let our specialists guide you toward a policy that matches your recovery journey and budget.

Take the first step today. Contact us for tailored health insurance advice.

Additional Resources

There are a number of Australian resources for anyone looking for support with alcohol or other addiction/s. Here's a list of helpful resources: 

• ReachOut Australia

• Alcohol and Drug Information Service (ADIS)

• Narcotics Anonymous

• Alcoholics Anonymous

• Alcohol & Drug Information

• Counselling Online

• Alcohol & Drug Foundation (ADF)

• SMART Recovery

Frequently Asked Questions

Do Extras Policies Cover Rehab Counselling?

Yes, some extras policies cover services like counselling or psychological therapy for mental health conditions associated with addiction. Check whether your extras policy includes psychologists or counsellors and what limits apply to the number of sessions per year.

Can I Claim Rehab Treatment Immediately?

If you already hold a Gold or Silver Plus hospital policy that covers rehab, you can claim treatment straight away. However, if you’re purchasing insurance for the first time, expect to serve a 2-month waiting period for inpatient and mental health services.

Will Private Health Insurance Cover Ongoing Aftercare?

Appropriate private health insurance may cover long-term aftercare support (e.g., ongoing counselling or group programs). Medicare rebates may also assist.

Are Alcohol Addiction Treatments Confidential?

Yes. Both public and private rehab centres adhere to strict confidentiality and privacy regulations. Your details are only shared with your consent or where legally required.

Sources

• AIHW

• The Sydney Retreat

• The Ray Hader Clinic

• https://www.aihw.gov.au/reports/illicit-use-of-drugs/illicit-drug-use

• https://www.aihw.gov.au/reports/alcohol/alcohol-tobacco-other-drugs-australia/contents/drug-types/alcohol

• https://www.rehabmelbourne.com.au/FAQ/how-much-does-rehab-cost/ 

• https://smartrecoveryaustralia.com.au/ 

• https://www.health.nsw.gov.au/aod/Pages/wmrs-contact.aspx#bookmark2

• Beyond Blue

• Australian Department of Health

• Private Health Insurance Ombudsman

• Alcohol and Drug Foundation

Related Article

Will Health Insurance help With Alcohol Addiction Rehab?

Chris Stanley is the sales & operations manager of health insurance at Compare Club. With extensive experience and expertise, Chris is a trusted leader known for his deep understanding of health insurance markets, policies, and coverage options. As the sales & operations manager of health insurance, Chris leads a team of dedicated professionals committed to helping individuals and families make informed decisions about their health insurance needs.

Meet our health insurance expert, Chris Stanley

Chris's top health insurance tips

• 1

  Australia’s public health system is world-class, but wait times for public hospitals can be long, inconvenient - and leave you living in constant pain while you wait.

• 2

  An appropriate private health insurance policy can speed up your surgery, relieving your pain sooner.

• 3

  Family health cover means your children are covered under the same policy as you.

• 4

  Many health insurance policies come with a 12-month waiting period for pregnancy-related cover, so it’s a good idea to get a family policy organized well before starting your family. This means your child will be covered from birth until at least their early twenties (depending on which health fund you select).