Mental Health Policy - The History of Mental Health Policy in the United States

Mental Health Policy II
The History of Mental Health Policy in the United States
(The Rise of the Community Mental Health Movement)
1

2
Legislation generally assumes a static universe; a legal mandate
supposedly alters individual and group behavior in ways that overcome
older policy deficiencies…. But reality is far more complex.
Faced with laws designed to transform policy, individuals and groups
often adjust their behavior in the light of new realities. In so doing they
transform legislative intent in unforeseen and unpredictable ways, thus
giving rise to unanticipated consequences.

3
• Moral treatment (1790’s to 1900s)
• Provide humane care for the mentally ill; replaced sanitariums.
• “Moral treatment” ala Phillipe Pinel; conceived of humane care
through environmental intervention.
• Forerunner of “milieu therapy”.
• Resulted in the erection of state mental hospitals in the United
States (Dorothea Dix).
• Never lived up to original intentions (small clinics became large
asylums).

4
Phillipe Pinel (1745-1826)
• Regarded by many as the father of
modern psychiatry.
• Did away with bleeding, purging, and
blistering in favor of a therapy that
involved close contact with and careful
observation of patients.
• Observed a strict nonviolent, nonmedical
management of mental patients that
came to be called moral treatment
though psychological might be a more
accurate translation of the French
‘moral’.

5
Benjamin Rush (1745 – 1813)
• Considered the "Father of American Psychiatry",
publishing the first textbook on the subject in the US:
Medical Inquiries and Observations upon the
Diseases of the Mind (1812).
• An advocate of insane asylums, believing that with
proper treatment mental diseases could be cured.
• Emblem of the APA bears his portrait.
• Developed the conception of addiction as a form of
medical disease and the idea that abstinence is the
only cure for addiction.
• Advocated forced psychiatric treatment: a favorite method was to tie a patient to a
board and spin it at a rapid speed until all the blood went to the head.
• Placed his own son in one of his hospitals for 27 years, until his son died.
• Believed that being black was a hereditary illness which he referred to as
'negroidism‘ but also believed that since it was merely a skin condition slavery and
racial discrimination should be abolished.

6
Patient in a spinning cheer

7
Dorothea Dix (1802 – 1887)
Suffered a debilitating breakdown in her mid-
thirties. In hopes of a cure, in 1836 she traveled
to England , where she met men and women who
believed that government should play a direct,
active role in social welfare.

8
The Indigent Insane Bill
• Promoted a grant of land for the relief and support of indigent, curable
and incurable insane.
• Provide asylums that would emphasize “moral treatment”
• Humane treatment based on compassion and care rather than
assigning mentally ill people to jails, poorhouses, or life on the
streets.
• Orderly routine with social contact, exercise and work rather than
efforts to rid the body of demonic possession and corporal
punishment.

9
President Franklin Pierce Vetoes the Bill in 1854
"If Congress has the power to make
provisions for the indigent insane, the whole
field of public beneficence is thrown open to
the care and culture of the federal
government. I readily acknowledge the duty
incumbent on us all to provide for those who,
in the mysterious order of providence, are
subject to want and to disease of body or
mind, but I cannot find any authority in the
Constitution that makes the federal
government the great almoner of public
charity throughout the United States."

10
Asylums Supported by States
• Dix resumes her campaign, state by state, for the
establishment of public asylums supported by state tax dollars.
• Her advocacy led to the founding of 32 hospitals in 18 states.
• Over time asylums changed from small therapeutic programs
into large custodial public hospitals.
• Concepts of "curability" were replaced by concepts of custody
and chronicity.

11
Era of the Asylum (1850s to 1950)
• This is the time when many believe psychiatric “treatment” was at its
lowest point.
• The importance of the idea of “eugenics”, that humans who were
mentally ill were genetically inferior to others and should not be
allowed to pro-create to avoid polluting the “gene plasm”.
• Pseudo-science predominated with virtually no control over what
kind of treatments patients received:
o Insulin-shock
o Hydrotherapy
o Lobotomy

12
Hydrotherapy

13
Insulin shock

14
Era of the Asylum (1850s to 1950)
• 100 years of state-based approaches.
o Long term institutional care
o Large hospitals
o Custody rather than treatment
• By the mid-1950s about 560,000 Americans resided in state
supported institutions.
• The average length of stay was measured in years. Many patients
spent their entire lifetime in Asylums.

15
Deinstitutionalization – Late 1950s
Many factors led to deinstitutionalization:
• Journalistic exposés.
• Introduction of chlorpromazine (thorazine)
which initiated the psychopharmacologic
revolution.
• President Eisenhower's major study of the
care of the mentally ill population:
o Mental institutions were often viewed as inhuman
‘‘snake pits’’ factories for the manufacture of madness.
o Evidence of social and functional deterioration following
long-term care reinforced the notion that institutions
caused chronic disorder.

16
Life Magazine Expose – Bedlam 1946
• Pennsylvania’s Byberry
• Ohio’s Cleveland State
"All of a sudden America sees
these photos that look like
concentration camp photos. You
see people huddled naked along
walls, strapped to benches
benches… and it really is this
descent into this shameful
moment." - Robert Whitaker, author
of “Mad In America”

17
Life Magazine Expose

18
Life Magazine Expose

19
World War II
Several new ideas emerged with military
psychiatry:
• Proximity - treatment should occur as
close as possible to where symptoms were
exhibited.
• Immediacy - early identification and
treatment lead to better outcomes.
• Simplicity - the major part of intervention
should consist of rest, nourishment, and
social support
• Expectancy - return to former functioning
was possible.

20
The First CMHCs
• The first CMHCs were principally devoted to consultation and
education for community agencies.
• Offered treatment to new groups of previously untreated, acutely
ill, and emotionally troubled patients.
• Few persons with severe and chronic illnesses were treated

21
Mental Health Study Act - 1955
• In 1955 Congress passed the Mental Health Study Act to study
the problems of mental illness.
• The final report (1961 Action for Mental Health issued by The
Joint Commission on Mental Health and Illness):
o Immediate care be made available to mentally ill patients in
community settings.
o Fully staffed, full full-people US time mental health clinics be
accessible to all people living in the US.
o Community based aftercare and rehabilitation.

22
The Kennedys
In 1961 John F Kennedy became president. He had family experience
with mental disability.
When she was 23, Kennedy’s father was told by doctors that his sister
Rosemary Kennedy’s “mood swings” could be calmed through a cutting
edge procedure. This is the doctor’s description of the surgery:
We went through the top of the head, I think she was awake. She had a mild
tranquilizer. I made a surgical incision in the brain through the skull. It was
near the front. It was on both sides. We just made a small incision, no more
than an inch." The instrument Dr. Watts used looked like a butter knife. He
swung it up and down to cut brain tissue. "We put an instrument inside," he
said. As Dr. Watts cut, Dr. Freeman put questions to Rosemary. For example,
he asked her to recite the Lord's Prayer or sing "God Bless America" or count
backwards. ... "We made an estimate on how far to cut based on how she
responded." ... When she began to become incoherent, they stopped. -
James W. Watts

23
The Kennedys
• The lobotomy reduced her to an infantile
mentality that left her incontinent and
staring blankly at walls for hours and her
verbal skills were reduced to unintelligible
babble.
• She lived out her life in a Wisconsin
institution and died at the age of 86.
See: Torrey, E. F. (2013). American psychosis: How the
federal government destroyed the mental illness treatment
system. New York, NY: Oxford University Press.

24
Community Mental Health Movement (1960s through 1990s)
In 1963, JFK addressed Congress on “A Bold
New Approach”…
• A national mental health program to assist in the
inauguration of a wholly new emphasis and approach to
care for the mentally ill
• Focus on comprehensive community care.
• We need a new type of health care facility; one which will
return mental health care to the mainstream of American
medicine, and at the same time upgrade mental health
services.
• I recommend, therefore, that the Congress:
• Authorize grants to the states for the construction of
comprehensive community mental health centers.
• Authorize short term project grants for the initial
staffing costs.

25
CMHC Construction Act of 1963
• The Mental Retardation Facilities and CMHC Construction Act signed
on October 31, 1963.
• Ended 109 years of federal noninvolvement in state services for the
mentally ill.
• Congress refused to authorize funds to hire staff for CMHCs.
• Less than a month later President Kennedy was assassinated.

26
President Johnson signs amendments in 1965
that provide staffing grants (Accomplished out
of sentiment for JFK)
• In 1965 mental health catchment areas of
75,000 to 200,000 people all over the
country began applying for federal grants.
• Program based on federal seed money
grants:
o Local communities applied for federal
funds that declined over several years.
o Alternative funds like third-party
payments were expected to replace
declining federal grants.

27
• Provide five essential services:
o Inpatient
o Outpatient
o Day treatment
o Emergency care
o Consultation and education
• Ensure continuity of care between the services.
• Be accessible to the general population.
• Serve people regardless of their ability to pay: “… a reasonable
volume of services to the indigent “

28
• Aside from the staff funding issue, there were several fundamental
flaws in the 1963 act that first funded CMHCs which led to later
problems:
o Relationships with existing psychiatric hospitals were not spelled
out or considered in any detail. This led to fragmentation of
services (among other reasons) and no continuity of care.
o Created a system that largely bypassed state authority (feds
worked directly with local communities)… because states were
seen as inept and invested in psychiatric hospitals.
o Population to be served was not well defined. This opened the
door to the CMHCs providing care to the “worried well” and not
to those with severe and persistent mental illnesses.

29
New Requirements, No New Funding
• In the early 1970’s Richard Nixon tried to
discontinue the program but was rebuffed
by the Democratic Congress.
• In 1974 Gerald Ford vetoed the extension
of the Community Mental Health Act.
• Existing centers were supported by
congressional continuing resolutions until a
new bill could be developed.

30
New Requirements, No New Funding
• In 1975 another extension was also vetoed by
Ford on the grounds that it was too expensive but
Congress overrode the veto by a wide margin.
• Congress passed amendments that added more
requirements for the mental health centers but did
not appropriate the funds necessary to pay for the
newly required services or to cover even half of
the country in the time frame initially envisioned.
o Services for children, the elderly, and
chemically dependent persons as well as
rehabilitation, housing, and preventive
services.

31
• After 1975 no new construction was attempted due largely to
prohibitive costs. Actual federal dollars were reduced while inflation
more than doubled the cost of construction and staffing costs.
• Most CMHCs were focused on primary and secondary prevention
programs:
o Crisis clinics and hot lines to prevent mental illness.
o Staff more interested in insight oriented psychotherapy than in
case management and rehabilitation.
• Severely mentally ill persons leaving state hospitals did not receive
follow-up services necessary to live in the community.
Failure to Meet Goals

32
• Between 1955 and 1980 the population of
state mental hospitals dropped from
558,000 to 140,000.
• Were these people better off out of state
hospitals?
CMHCs and Deinstitutionalization
o Funds from the states that were supposed to follow patients
from the hospital into the community did not provide sheltered
housing and treatment.
o Poverty, homelessness, and criminalization resulted.

33
• Medicaid and Medicare had much more to do with the population
decline in psychiatric hospitals than either the CMHCs or
psychotropic drugs such as thorazine.
• The locus of care for people with SPMI became nursing homes
because of generous federal payments (Medicaid). In effect the
states were cost-shifting the burden of care for people with SPMI to
the federal government. (Illinois was/is a major offender.)
• The shift from psych hospitals to nursing homes had nothing to do
with improved quality of care. Some have attested that it had a lot
to do (especially in Illinois) with the powerful and well moneyed
nursing home lobby.

34
• State hospitals too started to shorten the
length of stays (probably also for cost-
saving and due to civil commitment laws).
• Pressure on hospitals and psychiatry also
from people such as Thomas Szasz who
argued that mental illness was a myth and
that individuals behaving in unconventional
ways were being controlled.
Other Factors Leading to Deinstitutionalization
Tom Szasz & Tom Cruise
• The thinking of Thomas Scheff was also important: “Labeling Theory”
which posited that psychiatric diagnoses were convenient labels
attached to individuals who violated conventional behavioral norms
and led to stigmatizing them.
• This too became an argument for not putting people in psychiatric
hospitals.

35
• The decline in state psychiatric hospitals also saw a rise in general
hospitals adding specialty psychiatric wings. But these provided
shorter-term, acute care.
• A large increase in clinically trained mental health personnel
including social workers together with the expansion of diagnostic
categories in the DSM (DSM-IIIR and DSM-IV) led to a new and
expanded group of people receiving psychiatric care of one type or
another.

36
• One author (Grob) puts forth the hypothesis that there was a shift in
the nature of people with psychiatric disorders in the 1970s that
coincided with deinstitutionalization.
• The significance of this shift is that people who would have formerly
been hospitalized were now in the community and even more
difficult to treat in that context:
o Baby boom children (large numbers).
o Treated in the community and not in hospitals.
o High rates of alcoholism and drug addiction (heroin and then
cocaine).
o High rates of homelessness (veterans).
o Used psychiatric facilities but in an unsystematic way (also used
ERs, jails, and prisons).
o Non-compliant with medications or treatment generally.

37
Ironically, at the very time that unified, coordinated, and integrated
medical and social services were needed to deal with a new patient
population, the policy of deinstitutionalization had created a
decentralized system that often lacked any clear focus and diffused
responsibility and authority.
• Their point is that as bad as the state psych hospitals were, they
provided structure and consistency that was lacking in the CMHCs.

38
• The CMHC movement played out along several dimensions that
repeat often (and swing back and forth in US policy in various
areas). These are all good policy questions for consideration:
o The role of the states versus the federal government?
o Provide services to many people or focus on the few with the
most severe disorders?
o To what extent should prevention be a focus (Carter
commission)?

39
Community Support Programs
• CSPs were the NIMH’s response to the unmet needs of the
CMI (Chronically Mentally Ill).
• By 1982 most of the states had received some sort of
community support planning help for CMHCs.
o Case management
o Psychosocial rehabilitation
o Supported living
o Supported working
o Crisis care
• New evidence-based practices (EBP).
o Assertive Community Treatment

40
 1977 Presidential Commission on
Mental Health chaired by First Lady
Rosalyn Carter.
 Persons with chronic mental illness who
had been deinstitutionalized lacked the
basic necessities of life including
adequate housing, clothing, and food.
 Half of the people released from large
mental hospitals were being readmitted
within a year of discharge
Reassessment of the CMHC Program

41
National Mental Health Systems Act of 1980
• An effort to reinvigorate the CMHC program and redirect it to
those with chronic mental illness.
o Restructure federal, state, and local relationships allowing
the states more control of the management and distribution
of federal funds coming to local programs.
o Give priority to vulnerable groups such as the chronically
mentally ill, children, adolescents, and the elderly.
o Supported strengthening of personal and community
supports (emphasis on support systems rather than
treatment per se).
o Provide the most appropriate care in the least restrictive
environment.
• Signed one month before Carter lost the election to Reagan.

42
Withdrawal of Federal Government
“New Federalism”
• Reagan promises to reduce government waste and
regulation and to return responsibility for many
social programs to the states
• The Omnibus Budget Reconciliation Act of 1981
o Repealed the Mental Health Systems Act of
1980
o Eliminated all of the federal initiatives of the
previous 18 years
o Eliminated all of the 10 federal regional offices
of NIMH
o Lack of capacity to supervise and provide
technical assistance to surviving federal
CMHCs

43
Withdrawal of Federal Government
OBRA 1981:
• Withdrew direct federal grant support from CMHCs
and replaced it with block grants to the states
• Returned primary authority to states to decide how
and to whom mental health services should be
provided.
• Ceased to make official use of the term “community
mental health center” to describe a unique entity.
o Only 754 of a possible 1,500 eligible catchment
areas nationwide had applied for and received
funding for CMHCs.
• CMHCs increased fees and reduced staffing and
services
o Waiting lists developed
o Service quality decreased

44
Medicaid
• Created in 1965 to provide health insurance for low-income
parents, children, seniors, and people with disabilities.
• Supplemental Security Income established in 1972 provided
welfare to those disabled due to mental illness.
• By the 80's all CMHCs switched to Medicaid and away from
block grant money.
• From 1981 through 1983, the Reagan administration attempted
to purge SSI/SSDI roles through use of continuing disability
investigations/reviews; eventually this was reversed and
reforms in how SSI/SSDI mental health disabilities were
determined was revised and made clearer.

45
CMHCs of Today
• CMHCs have survived but service priorities and the locus of cont
have changed.
• CMHCs remain the only option for mental health treatment for
low-income uninsured people.
• CMHCs have had to use revenues from a patchwork of funders to
cover the costs of caring for uninsured and underinsured:
o Paying patients
o Federal governments
o State governments
o Local governments
o Fund raising

46
CMHCs of Today
• Availability of services have steadily decreased in the last twenty
years.
• Individuals often sit on waiting lists for extended periods or are
turned away.

47
 Reagan Administration
• CMHC programs and deinstitutionalization were implemented
without evidence of effectiveness of treatments and without a
social welfare system for the disabled mentally ill.
• Communities lacked availability of:
o Supported housing
o Community treatment approaches
o Vocational opportunities
o Income supports
• Many became homeless
• Many became incarcerated

48
• CMHCs could not handle the huge numbers of patients who had
been released after spending months or years in the large
institutions:
Nowhere in our society is the debacle of deinstitutionalization felt
more than in our criminal justice system. America’s jails and
prisons are now surrogate psychiatric hospitals for thousands of
individuals with the severest brain diseases.
Treatment Advocacy Center Briefing Paper.
Criminalization of individuals with severe psychiatric disorders. 4/2007
• 10- 16% of US inmates have serious psychiatric illnesses like
schizophrenia, bipolar disorder and disabling depression.
Out of the Asylum Into the Cell

49
Hindsight

50
Hindsight
Many of those patients who left the state hospitals never should have
done so. We psychiatrists saw too much of the old snake pit, saw too
many people who shouldn't have been there and we overreacted. The
result is not what we intended, and perhaps we didn't ask the questions
that should have been asked when developing a new concept, but
psychiatrists are human, too, and we tried our damnedest.
Dr. Robert H. Felix, past director of the NIMH and a major figure in the shift
to CMHCs

51
Hindsight
The psychiatrists involved in the policy making at that time certainly
oversold community treatment... the policies were based partly on
wishful thinking, partly on the enormousness of the problem and the
lack of a silver bullet to resolve it, then as now.
Dr. John A. Talbott, past president of the American Psychiatric Association

52
• Health Security Act of 1993 (would have):
• Provided universal health care coverage for all
Americans including coverage for mental health
care
• Intended to eliminate two-tier system of care
• Defeated by intense lobbying underwritten by the
AMA and insurance companies
o “quality of health care would decrease”
o “unnecessary big government
o successful “Harry and Louise”
commercials
• Led to 3-tier structure
• Public (Medicaid and Medicare)
• Private not-for-profit
• Private for-profit
A Failed Attempt at Universal Healthcare

53
Compare the original Harry and Louise ad, circa
1994:
https://www.youtube.com/watch?v=Dt31nhleeCg
With this ad designed to dissuade people from
supporting the Affordable Care Act circa 2013:
https://www.youtube.com/watch?v=rMnojpcSqwg
The message is the same: government interference in
health care is bad.
A Failed Attempt at Universal Healthcare

54
• Definition: “Any kind of health care services which are paid for, all or
in part, by a third party (including any government entity) and for
which the focus of any part of clinical decision-making is other than
between practitioner and the client or patient.”
• HMO Act of 1973 established HMOs and required that they
included outpatient mental health services.
• Increasingly, states have turned to some form of managed care for
Medicaid and Medicare including Illinois.
• The County Care program relies on a managed care model of
services (rather than fee-for-service) for new Medicaid enrollees (up
to 138% of fpl).
Managed Care Era (1990s through 2010)

55
• Many managed care programs have behavioral health “carve-outs”
with a separate company managing mental health and substance
abuse services.
• Most often, separate company does not cover or include
prescription drug benefits (incentive to shift cost back to other
company) resulting in disincentive for psychotherapy.
• Pharmacy Benefit Managers and “Formularies” often determine
who gets what drugs including psychotropic drugs.
Managed Care Era (1990s through today)

56
• Consumer-driven movement to improve quality of care with
emphasis on helping individuals assimilate back into society to the
fullest extent possible
• Recovery versus decline over the life course.
• Consumer and advocate input on treatments and policies.
Recovery Era (2000s through today?)

57
Created by the Bush Administration to:
… study the mental health service delivery
system, and to make recommendations that
would enable adults with serious mental
illnesses and children with serious
emotional disturbance to live, work, learn,
and participate fully in their communities.
President’s New Freedom Commission on Mental Health
(2003)

58
The final report enumerated 6 goals, each with recommendations on how
they might be achieved:
• Americans understand that Mental Health is essential to overall health.
• Mental health care is consumer and family driven.
• Disparities in mental health services are eliminated.
• Early mental health screening, assessment, and referral to services are
common practice.
• Excellent mental health care is delivered and research accelerated.
• Technology is used to access mental health care and information.
President’s New Freedom Commission on Mental Health
(2003)

59
 Provides drug benefits under a complicated formula to Medicare
recipients and includes psychotropic drugs.
 Disincentive to provide medication for those with a severe mental
illness under Part D (stand-alone drug plans) and the formularies
may be gerrymandered to not include the best medications.
 Dually eligible (Medicaid-Medicare) may be hurt the worst.
Medicare Prescription Drug Improvement ,
and Modernization Act (2003)

60
Mental Health Parity Act (1996)
• Close insurance coverage gap between
mental health medical insurance coverage.
• Had many loopholes:
o Only companies over 50 employees.
o No requirement to offer mental health
benefits.
o Waiver if too costly to comply.
o Limits could be set using managed care
techniques (10 sessions).
Mental Health Parity
• In 1999, Clinton directs OPM to implement parity in FEHB.

61
Mental Health Parity and Addiction Equity Act (2008):
• Continued to apply to employers with >= 50 employees.
• Closed loopholes for treatment limits, cost-sharing, and network
coverages.
• Applied to substance abuse as well as mental health treatment.
The ACA applied MHPEA to health plans purchased by individuals and
on the small business exchange (SHOP).

62
Remaining issues:
Inadequate supply of MH/SA treatment: especially in rural areas and
in pediatrics.
Non-equivalence of services: “How to provide coverage for care levels
and treatment venues that are unique to behavioral health, and aligning
these with medical and surgical benefits, is a continuing discussion
within health plans and between plans and regulators.”
Segregated services: Another obstacle to care that persists despite
passage of parity legislation is the fragmentation of the American health
care delivery system. Arguably, one reason patients with mental health
and substance use disorders experience fragmentation is due to the use
of carve-outs for providing mental health/substance use benefits.

63
Main provisions:
1) Integrate physical and mental health – States eligible for 2 million
over 5 years. Identify barriers and work to resolve them.
2) Designate an Assistant Secretary for Mental Health and Substance
Use within DHHS.
3) Establish new grants for early intervention for children as young as 3
and support pediatrician consultation with mental health teams.
4) Establish interagency SMI Coordinating Committee under Assistant
Secretary to promote research and treatment.
5) Repeal Medicaid exclusion on inpatient care for persons 22 – 64 if
no net increase in spending certified by CMS.
Mental Health Reform Act (Proposed Cassidy-Murphy)

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