Study Shows Medicare is the Least Accepted Form of Payment at Substance Use Disorder Treatment Facilities


There is at least a 28% difference in the amount of licensed US substance use disorder facilities that accept Medicaid and private insurance compared to Medicare, according to new research.

There are fewer facilities that treat substance uses disorder (SUD) and accept Medicare than other forms of payments, according to a study published by JAMA Network Open.

Only 57% of Medicare beneficiaries are within a 15-minute drive of an SUD facility, compared to 73% of Medicaid patients or patients with private insurance. This can be concerning for older adults, particularly those aged 55 to 64 years, who since 1999 have experienced drug overdose deaths at a rate 6-times higher than those in younger age groups.

“This study suggests that, between 2010 and 2021, geographic access increased for SUD treatment for all payers. However, the proportion of facilities that accepted Medicare remained low,” the study authors wrote.

By 2021, the researchers observed a 15% increase in countywide treatment facilities that accept Medicaid and private insurance as forms of payment compared to Medicare.

Limited affordability and limited availability are 2 reasons that older adults with SUD who are Medicare beneficiaries may not receive treatment. Medicare may not be covered by many facilities due to the lack of a reimbursement rate for intensive outpatient services, or treatment is not considered a home health care benefit. Additionally, many adults who live in rural or small-town America might not have as many SUD treatment facilities.

In a longitudinal cross-sectional study of licensed US SUD treatment facilities, researchers aimed to quantify whether facilities changed acceptance of certain payment methods, such as Medicare, Medicaid, private insurance, and cash payment between 2010 and 2021.

Specifically, they looked at the geographic availability of SUD treatment facilities that did/did not accept Medicare. With this as a marker, researchers could examine whether services were being limited to older adults.

The data showed that approximately 42% of SUD facilities accepted Medicare; however, more than 70% of facilities accepted Medicaid and private insurance.

“The results of this study imply that Medicare is behind other payers in convincing treatment facilities to accept it as a form of payment,” the study authors wrote.

Despite this, cash was the most common form of payment in 2021. This was followed by 75.3% of facilities accepting private insurance, then Medicaid at 71.8%, and Medicare at 41.9%. However, Medicare acceptance is on the rise, as facilities that accept Medicare increased to 53.8% on the county level and continue to grow at a slower rate than other insurances and programs.

There are limitations to this study—the first of which being that data exclude unlicensed treatment facilities. Additionally, patients were not counted at each facility, barriers of access were not analyzed, nor was travel time to the facility between different modes of transportation. Finally, the results may be incorrect estimates of geographic availability.

“Policy makers need to consider increasing reimbursement rates and using additional incentives to encourage the acceptance of Medicare,” the study authors concluded.


Cantor, Jonathan, DeYoreo, Maria, Hanson, Russell, et al. Patterns in Geographic Distribution of Substance Use Disorder Treatment Facilities in the US and Accepted Forms of Payment From 2010 to 2021. JAMA Netw Open. 2022;5(11):e2241128. doi:10.1001/jamanetworkopen.2022.41128

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