Most commercial health insurance providers cover residential mental health treatment. It’s also possible to receive residential mental health treatment without insurance. However, there are certain considerations you should make before moving forward with either option.
The reality is insurance is one of the biggest barriers to accessing mental health treatment [1]. Anyone seeking mental health support deserves it, and their only priority should be to get better. Navigating insurance can feel overwhelming, but by understanding the basic requirements and processes, you can make confident financial decisions.
What Is Residential Care?
Residential care is a form of mental health support where people live in a facility while they receive treatment. The setting is not a hospital but typically a treatment center with home-like facilities to make people feel comfortable and safe.
People in residential care are monitored 24/7 by licensed physicians and mental health professionals to ensure their well-being. Residential care programs last, on average, from a couple of weeks to a few months. The severity of the person’s condition and their needs determine if the stay is short- or long-term. During this time, people receive therapy and medication as needed, and participate in holistic activities like yoga and mindfulness.
Residential care can be a stepping stone between inpatient hospitalization (if required) and outpatient programs. Alternatively, it may be the type of treatment program that best suits a person’s needs. Residential care helps people as they address mental health challenges, while providing crucial professional support and resources. Much of the treatment focuses on therapy, skills-building, developing coping mechanisms, and preparing for ongoing recovery.
Research confirms the effectiveness of residential care for mental health. In one study, people in residential treatment showed a significantly lower prevalence of major depressive symptoms [2]. Elsewhere, researchers found that the majority of people who finished residential treatment were living independently [3].
How Do I Know If My Insurance Provider Covers Residential Care?
If you know the residential treatment you need, contact the admissions team of the facility who will conduct a Verification of Benefits (VOB). A VOB is the process to:
- Confirm that your insurance is accepted by the treatment center
- Confirm that your plan covers the residential care you need
You can also check if your insurance provider is ‘in-network’ for the treatment center. In-network means that the provider accepts the center and will cover all, or some, costs of treatment. You can normally find the list of in-network providers on the center’s website or call the admissions team to ask.
If your insurance provider is not on the in-network list, it’s considered ‘out-of-network’. In that instance, your insurance will not cover any costs of treatment at the center.
What Do I Need For the Verification of Benefits?
The VOB can be relatively straightforward and clear if you have the correct documents and information ready. To save time and start your residential mental health treatment as soon as possible, prepare the following before you contact admissions:
- Your full name and date of birth
- A copy of your insurance card (front and back)
- Your policyholder’s information
- Your member ID and group number
- Contact details for your insurance provider
- Information about the residential program you want
Advice For A Smooth VOB Process
Many people find the VOB process daunting but some simple actions can help you feel in control and prepared. Keep in mind that admissions teams are an extension of your mental health treatment — they will operate with compassion and patience.
Before calling:
- Check whether your insurance provider is ‘in-network’ for the mental health center
- Confirm that all the documents you have are up to date
- Have your documents in front of you, open at the right pages to easily share information
During the call:
- Ask specific questions about what costs your insurance covers and if there are additional payments or other limitations
- Take notes, especially if you’re given reference numbers or names
- Let the admissions team know if you have additional needs
- Ask for clarity if there’s anything you don’t understand
Can I Pay Out-Of-Pocket For Residential Care?
Yes, you can pay out-of-pocket for residential care. This option is taken by people who don’t have health insurance or people whose health insurance provider is out-of-network for the care they want.
Paying out-of-pocket is more expensive than using insurance. However, many treatment centers offer payment plans to help people afford care in small, incremental payments.
If you want to know more about paying out-of-pocket for residential care, speak with the health center’s admissions team — they may be able to suggest alternative financing that suits you.
Accessible Residential Mental Health Treatment at Colorado Mental Health Services
At Colorado Mental Health Services, we believe that everyone should have access to high-quality residential mental health care. Our VOB process is transparent and empathetic, so you can get closer to healing, faster.
Our residential mental health treatment is run by a team of licensed professionals who offer personalized care for those experiencing depression and other mental health disorders. Through a combination of evidence-backed therapies and medications we help you find stability.
Our treatment center is located in Lakewood, CO, and has welcoming facilities to make you feel secure and at home.
We’re happy to answer any questions you may have and to gently guide you through a financial breakdown of your insurance coverage and possible costs for our programs.
Speak with our admissions team and take the first step to finding mental peace.
FAQs
What is a residential program?
A residential program is when people live in a facility while they receive treatment for mental health, addiction or substance use disorders. The facility is normally a treatment center with home-like amenities where people can feel safe and comfortable.
Residential programs can run for weeks or months depending on the severity of the person’s disorder. During the program, people are monitored 24/7 by clinical staff and medical providers are available as needed. Programming includes evidence-based therapies and holistic activities.
Residential care has been proven to effectively support people and prepare them for recovery.
Why do people go to residential treatment?
Residential care is often used as a stepping stone between inpatient hospitalization and outpatient programs or it may be a direct placement alternative. It provides a stable, secure place to heal alongside crucial professional support and resources. Much of the treatment in residential care focuses on skills-building, coping mechanisms, and ongoing recovery.
What mental health conditions are covered by insurance?
Confirm with your insurance provider what specific mental health conditions and treatments they cover. Some providers will cover all costs, others may only cover partial costs, and some may not offer mental health coverage.
Keep in mind that the Mental Health Parity and Addiction Equity Act (MHPAEA) is a federal law stating that mental health coverage must be equal to physical health coverage. Because of this law, health insurance providers that cover mental health must do so to the same degree as their coverage for medical/surgical care.
Does mental health have to be covered by insurance?
Yes, mental health treatment does have to be covered by insurance. The Mental Health Parity and Addiction Equity Act (MHPAEA) states that health insurance providers covering mental health must do so to the same degree as their coverage for medical/surgical care.
The extent of mental health coverage can vary between providers, so confirm what mental health care your provider will pay for, for how long, and with what restrictions.
How much does mental health care cost without insurance?
The cost for mental health care without insurance can vary dramatically depending on the health care facility, the preferred treatment, and the disorder being treated. To get exact pricing, speak to our admissions team or your insurance provider.
Paying for mental health care out-of-pocket is more expensive than with insurance. Ask us if there are alternative payment options available before committing to care.
Sources
[1] Rowan, K. et al. (November 2014). Access and Cost Barriers to Mental Health Care by Insurance Status. 1999 to 2010. Author Manuscript. PubMed Central.
[2] Hermer, L. Natarajan, A. (December 2025). Does Person-Centered Care Improve Nursing Facility Residents’ Mental Health? A Review and Commentary. European Society of Medicine. esmed.org.
[3] Bull, S. (April 2018). Efficacy of Long-Term Residential Treatment For Persistent Mental Illness. Schizophrenia Bulletin. PubMed Central.