Forty Years of Neglect
The Federal Role in Caring for the Severely Mentally Ill
About This Event

On October 31, 1963, President John F. Kennedy signed into law the Community Mental Health Centers Act, through which psychiatric patients would be treated in small community clinics rather than in large expensive state hospitals. Though the act promised to improve conditions and save millions of dollars, it mostly added to the growing wave of deinstitutionalization that began a few years earlier. Some of the released patients were able to manage well on anti-psychotic medications with attendant social services, but many others landed on the streets and in jails. Today, at least a third of the homeless and up to one quarter of those incarcerated are people with severe mental disorders such as schizophrenia and manic-depressive illness.

In July 2003, the New Freedom Commission for Mental Health appointed by President George Bush released its report, Transforming Mental Healthcare in America. It championed the need for more and better housing options, employment, and "consumer" control but virtually neglected the most desperately ill that are unable to take advantage of social services and govern themselves.

Panelists at this event will consider the proper role of the federal government in caring for the severely mentally ill. Federal policies with respect to treatment, disability issues, involuntary care, and federally-funded research will be addressed, and recommendations will be presented for future revision and implementation.

Agenda

9:00 a.m.

Registration

9:30 Introduction: Sally Satel, AEI
9:45 Keynote Speaker:

E. Fuller Torrey, Stanley Research Foundation

10:30

Panelists: Wayne Fenton, George Washington University

Jeffrey Geller, University of Massachussetts at Amherst

Robert Keisling, Unity Healthcare

E. Fuller Torrey, Stanley Research Foundation

Mary Zdanowicz, Treatment Advocacy Center

Discussant:

Stuart Butler, Heritage Foundation

Moderator:

Sally Satel, AEI

Noon

Adjournment

Event Summary

October 2003
Forty Years of Neglect

On October 31, 1963, President John F. Kennedy signed into law the Community Mental Health Centers Act, through which psychiatric patients would be treated in small community clinics rather than in large and expensive state hospitals. Though the act promised to improve conditions and save millions of dollars, it mostly added to the growing wave of deinstitutionalization that began a few years earlier. Some of the released patients were able to manage well on anti-psychotic medications with attendant social services, but many others landed on the streets and in jails. Today, at least a third of the homeless and up to one quarter of those incarcerated have severe mental disorders such as schizophrenia and manic-depressive illness. On the fortieth anniversary of this legislation's enactment, a panel of mental health and policy experts gathered to discuss the repercussions of the federal government's role in caring for the severely mentally ill.

Dr. Sally Satel
AEI

In an address to the nation on February 5, 1963, President John F. Kennedy said, "Reliance on the cold mercy of custodial isolation will be supplanted by the open warmth of community concern and capability." It was his vision that the Community Mental Health Centers Act (The Act) would remove people from the "custodial isolation" of state mental hospitals and place them health centers run by the community. Unfortunately, that vision did not come to pass as planned. The panel was assembled to discuss how to improve the federal role in caring for the mentally ill.

Dr. Wayne Fenton
George Washington University

Dr. Fenton described the clinical and social dynamics that led to the Act in 1963 by giving a summart of the history of mental health care in the United States.

Care for the mentally ill began with the idea that each community had an obligation to care for the "deserving poor" in its midst. This took place in the alms house, which was run by a husband and wife who lived with and took care of the communities dependents--orphans, widows, aged, those without families and the mentally ill. While initially adequate, with increasing numbers of mentally ill, conditions eventually deteriorated. Nonetheless, almshouses and jails were the major locus of care until the importation of the model of moral treatment from Europe in the 1830s.

The American vision of "moral treatment model" attributed mental illness to the unruliness of American society: the decline of religion, breakdown of the family and unrestrained ambition in the new world. With the assumption that a disorderly society was the cause, the cure in part became removal from the overstimulating cities, and a rigid imposition of order in the lives of the mentally ill. With the support of advocates such as Dorothea Dix, state legislatures authorized the construction and operation of hospitals with regimented schedules of rehabilitation and work therapy. The United States, as a nation, was quite proud of our institutions that served as evidence of our enlightened society. In the 1850s, by vetoing legislation for federal funding of care for the mentally ill, President Pierce placed the responsibility for the care of the mentally ill in the hands of the states. 

This model deteriorated by the end of the nineteenth century. With the American population explosion, state-funded hospitals became overcrowded and state institutions came to be associated with the poor and foreigners. The loss of control over who would be admitted, coupled with the idea that hospitals were now merely mechanisms of social control, produced a shift in the national conscience from caring for the deserving poor to the idea that the mentally ill were "somebody else's problem."

Three factors have consistently influenced the government's perception of its role in caring for the mentally ill: legislation, litigation and scandal. Legislation and litigation guided the federal role, but scandal emerged as the force that brought the mental health crisis to the forefront of the American conscience in 1946. The nation was shocked into motion by an exposé that appeared in Life magazine entitled "Bedlam: 1946." This piece's strong language, along with its compellingly gruesome photos, brought the true horror of mental institutions to the nation's doorsteps, a theme repeated in popular movies such as "The Snake Pit."

With the focus once again on this neglected portion of our population, two other events over the next two decades changed the situation: the introduction of the anti-psychotic drug chlorpromazine (Thorazine), and President Kennedy's active investment in mental health. Since the Pierce veto, the 1963 Act was the first significant commitment of federal funds and produced powerful and immediate results. In the first two decades after the bill's ratification, there was a complete reversal of the proportion of all care delivered in inpatient various outpatient settings. Over the next half century, the move to close large state hospitals changed the population demographic of the mentally ill dramatically.

At present there are at least five times as many persons with serious mental illness in jails and prisons than in all mental hospital beds in the country. The current situation is alarming, and the mental health community is divided on how to fix the problem. The most compelling scientific research shows that for those maintained on neuroleptic anti-psychotic medication, there is a 70-80 percent chance that person will not relapse, but for those without medication or those assigned to placebo in a blind clinical trial, the results are completely reversed. It is clear that something must be done to get this at-risk population into care.

Dr. E. Fuller Torrey
Stanley Research Foundation

The 1963 Act was the last major piece of signed legislation signed by President Kennedy prior to his assassination.  It deals with the care of the severely mentally ill. It has become a symbol for the way that a well-meaning action can become a total and complete disaster.

The total failure of the 1963 legislation can be attributed to four flaws in the bill's design and implementation. First and foremost, there existed a number of failed assumptions about what was wrong with the severely mentally ill. Those responsible for the legislation did not fully understand brain diseases; assumed that if released from state institutions, the mentally ill could live happily ever after; and neglected to investigate a condition known as anosognosia. Anosognosia is an integral part of severe mental illness-as many as 50 percent of those with schizophrenia and 40 percent of those with bipolar are impaired to such an extent that they cannot recognize what is wrong with them. They are often completely unaware of their own illness. Therefore, a significant portion of the severely mentally ill cannot live "happily ever after" without direct treatment and supervision.

Secondly, the Act suffered from fundamentally flawed planning. The Act bypassed the states entirely and placed the burden of funding the community mental health centers on the federal government. The National Institute of Mental Health failed to provide the essential oversight needed to run the community centers. The community mental health centers were failed by a total unwillingness to take responsibility for center management at both the state and federal levels.

Thirdly, before the movement toward deinstitutionalization, the states covered 95 percent of the financing for care of the severely mentally ill. In the hopes of moving patients out of the state hospitals and into the community, the federal government made patients in state hospitals ineligible for aid while hospitalized, but eligible when discharged from the hospitals, thus providing the states with enormous incentive to empty out the hospitals. Deinstitutionalization quickly became the priority for state mental health agencies and there was no incentive to ask what happened to patients once they left the hospital.

Finally, the civil rights era exacerbated an already deteriorating situation. In the atmosphere of change, some activists decided that the severely mentally ill needed to be 'liberated' from state hospitals, arguing that "no one should be deprived of his freedom for the sake of his mental health," and "the goal should be nothing less than the abolition of involuntary hospitalization." These theories represented distorted views of  "freedom" and "liberty." Some psychiatrists countered: "Freedom to be sick, helpless and isolated is not freedom," and, "Can we really call it liberty if someone walks the streets in terror because of paranoid delusions or threatening hallucinations?"

And so the question now becomes, after those substantial failures, where are we left now? After the passage of the Act and the resultant deinstitutionalization, half the patients are better off, but half are considerably worse off. Many of them were not deinstitutionalized, but rather trans-institutionalized: moved into nursing homes, large group homes, or other facilities, which are often worse than the large hospitals. There has also been what can be termed a 'ghettoization' of the mentally ill: one-third of the homeless are severely mentally ill. Currently seven percent of inmates in jails and prisons are psychotic, and the Department of Justice and the Human Rights Watch suggest that those numbers are even higher-16 percent and 20 percent respectively. The three largest mental institutions in the United States are all correctional facilities; the L.A. County Jail, the Cook County Jail, and Riker's Island in New York.

Despite this desperate situation, we continue to incur enormous cost in programs that are quite obviously failing. In direct cost alone, $71 billion a year is spent on care for the mentally ill; when coupled with indirect cost, that number more than doubles. Since 1961, there has been more than a nine-fold increase-in constant dollars-in cost, and the federal government is currently carrying two-thirds of that cost. Federal costs are currently increasing at a rate of $2.6 billion a year in spite of their ineffectiveness. There is a lack of intelligence about how the money is being spent, not a lack of funding. President Kennedy's 1963 Act has been a failure, and its legacy persists today-a clear example of the danger when ideology wins out over rational policymaking and political correctness wins out over scientific correctness.

Dr. Jeffrey Geller
University of Massachusetts, Worcester, MA

Dr. Geller discussed the situation in the context of disability law.  The Americans with Disabilities Act was enacted in 1990, with Title II being devoted to public services.  In particular, section 12132 reads, "No qualified individual with a disability shall, by reason of such disability, be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity."

A number of court cases have been tried over that particular section, the most famous of which is the Olmstead case in the U.S. Supreme Court.  Brought on behalf of two women with mental illness and mental retardation, the court found, in a six to three majority that:

...for any person with mental disability, community based treatment rather than institutionalized placement is required of the states when 1) the state's treatment professionals have determined that community treatment is appropriate; 2) the transfer from institutional care to a less restrictive setting is not opposed by the affected individual; 3) community placement can be reasonably accommodated, taking into account the resources available to the state and the needs of others with mental disabilities.

Throughout federal cases to date, fundamental questions remain unanswered.  The terms "institutions" and "communities" have not been defined.  None of these cases addresses the fact that our current system is tilted toward moving people from institutions that cannot receive federal funds to institutions and non-institutional settings that can benefit from federal support.

There are six particular ways in which to begin to dismantle a paradigm that is preventing efficiency and effectiveness.  First, the unfounded concept that restrictiveness and/or isolation is inextricably linked to the locus of room and board should be abandoned.  Second, the present institution for mental diseases (IMD) exclusion must end.  Third, a system of Medicaid-reimbursed treatment for eligible persons should exist in all settings, including jails and prisons.  And it must be a requirement that in all settings these treatments meet the same CMS standards.  Fourth, a conscious effort must be made to introduce and sustain the concept that restrictiveness and integration is individually, not categorically, determined.  In other words, what is restrictive or not is dependant upon the individual's perception and appreciation.  Fifth, addressing the issue from a fiscal point of view, each state should require that the percentage of a person's Social Security Income (SSI) or Social Security Disability Income (SSDI) checks that is applied to room and board be the same, independent of the location at which that room and board is supplied.  And sixth, if we are going to truly respect safe autonomy, self-determination and free choice, do we not have to respect unpopular as well as popular decisions in both directions?  Thus, informed decisions made by patients must be respected, however unpopular or unwise they are seen to be.

The existent fundamental assumption that life outside of institutions is always better is unquestionably flawed.  The truth is, for persons with severe mental illness, each individual is different, and the option to remain in an "institution" must be made available to each individual after exposure to safe alternatives have been provided.

Ms. Mary Zdanowicz
Treatment Advocacy Center

The question of involuntary treatment was brought to nation's Capitol five years ago by Russell Weston, when he stormed its steps trying to find the "ruby-satellite system" he thought he needed to control the space-time continuum. Weston's case has become the most extreme example of the federal government's role in coercive strategies, and it demonstrates why such strategies are needed sooner rather than later. The prosecution has fought a pitched battle to medicate him over his objection so that he can be restored to competency and stand trial in a capital murder case for killing two Capitol police officers. This entire situation could have been avoided. Shortly after Weston was released from a state hospital, he reported to a community mental health facility for what he thought was court-ordered treatment. When he learned that a judge had not ordered him to keep the appointment, he left and never came back. He is now getting the court-ordered treatment that might have prevented this tragedy, but only after two people died and his life now hangs in the balance.

Why are coercive strategies necessary for people with severe mental illnesses? About half of people with schizophrenia and manic depression have impaired awareness of their illness. Presently, state laws require, or are interpreted to require, that a person must be dangerous before anything can be done to override their objections to treatment. There are clear implications of these laws: without coercive strategies, the most severely mentally ill will not receive the treatment they need.

The trend in the states is to incorporate "coercive" strategies to allow for early intervention and treatment for those too sick to recognize they need treatment.  But what should be the role of the federal government?  The federal government can be helpful in three particular ways: by fostering state efforts to treat those who are too ill to accept treatment on their own; insuring that federal resources are being used to leverage treatment for the most ill; and finally doing no harm.

First, the federal government must support change at the state level.  The Center for Mental Health Services focusing more of its resources to support state efforts to serve this vulnerable population that is incapable of accessing voluntary services.
The federal government should also leverage treatment compliance. America's Law Enforcement and Mental Health Project (P.L. 106-515, signed into law in November 2000) authorized funding for mental health courts that function in much the same way as criminal drug courts do. Additionally, the Mentally Ill Offender Treatment and Crime Reduction Act  (S-1194), if passed, will provide resources for the states to keep the most severely mentally ill out of the criminal justice system, thereby stopping the cycle at its conception. 

Finally, the federal government must try harder to do no harm. Protection and advocacy systems are federally funded state-based legal advocacy programs for people with disabilities. These programs are often used to bring lawsuits against states attempting to reform laws governing treatment, lobby and incite protests against new laws that facilitate treatment for those who otherwise refuse it.  Appropriations under the Protection and Advocacy Act of 1986 should prohibit funds from being used to aid or support activity that challenges the state law governing the involuntary treatment of persons with mental illness.

Furthermore, Congress should resist advocacy efforts to forbid the use of funds for services that are not "voluntary."  Ultimately, states are in the best position to determine the proper uses of their funds, and it is at the state level that we will most effectively deal with those unable to access voluntary treatment.  The assisted outpatient treatment is an important option for judges, who must otherwise confine someone in a hospital for treatment, and has been shown to reduce the risk of re-hospitalization, violence, homelessness, and arrest.

Comparing the advancements made at the state level to failings occurring at the federal level-the absence of discussion about anosognosia, involuntary treatment, or even mental health courts in the President's New Freedom Commission report released in July of this year-it appears that the proper role of the federal government in this issue is no role at all.

Dr. Robert Keisling
Unity Healthcare

The 1963 Community Mental Health Centers Act officially expired in 1980, but as has been made clear, these community centers continue to exist and provide care for many patients. More recently however, some have sought care in a primary care center. The next step for changing the face of mental illness treatment in the United States might well be the integration of primary care and mental health services on a national scale.

There is a convincing argument to be made from a large-scale integration. In the last four years, business at Unity Healthcare has increased 700 percent, but many of these patients are uninsured. Due to growing operating costs, Unity Healthcare applied for funding from the Department of Mental Health but was rejected because we were "not certified due to the fact that we do not choose to follow the sixty-eight plus pages of paperwork and rules." Why do primary care centers seem able to provide more efficient and effective care than community mental health centers? 

To begin with, mental health programs have bureaucratic systems that keep people out of treatment. The traditional mental health programs designed by the act have lost their effectiveness because of excess paperwork and inefficiency. The current system is now so complex and bureaucratic that only the highest functioning people can get into the system while the lowest functioning people, those who arguably need the help the most, get kicked to the curb. The most severely mentally ill are on the streets, in shelters and in jails, and those that get services are coming to private non-profits that get no money from the federal government.

It is time for radical change to occur in the mental health industry. We need to return to basic principles: organizations should compete for patients, and the money should then be awarded to those with the most positive outcome. We need to dismantle some of these cherished beliefs and replace them with interventions that have been shown to be effective in controlled studies that have been published in reputable, scientific journals.

All the studies show that treatment works if you get it out to the people who need the treatment. The problem is that most of the people who need the treatment are not getting the treatment because they don't know they need any, or because bureaucratic policies and procedures prevent people from getting the help they need. We need a totally new way of doing business.

Dr. E. Fuller Torrey
Stanley Research Foundation

From its conception, the 1963 act was supposed to ameliorate the lives of those with severe mental illness, not become centers where the "worried well" could bring their problems. By the beginning of the 1970s, however, the act was already failing at its mission. The government was giving the National Institute of Mental Illness (NIMH) money, which, in turn, went to the community, yet somehow it was not producing results. Why was this happening?

The NIMH was not only involved in running the community mental health centers; it was also a dancer in the minuet of mutual deception. At the heart of the failure is the truth that politicking prevented the NIMH from doing its job. Congress gave them money, and they needed to use it in order to continue receiving the money. NIMH failed to measure outcome. How can we change this? By giving the money to the states themselves and holding them responsible through a serious program of outcome evaluation that rewards those programs that work and cutting those that do not. We could contract a social research firm to measure this outcome and then determine additional funding-third-party evaluation is the ideal process for effectively changing the struggling programs.

A second abysmal failure of the NIMH is the lack of research on severe mental illness. The NIMH was set up after World War II to perform research yet has not done so. Less than one-third of the funds go to research dealing with severe mental illness, and less then 8 percent go into any sort of clinical research about those diseases. An acute example-many people turned to the NIMH for research on postpartum depression after the tragic story of Andrea Yates. Between 1972 and 2002, how many research grants had NIMH given to research postpartum depression? Answer: one. How many grants did it give out to study how pigeons think? Answer: ninety-two.

Over the years, the NIMH has demonstrated very clearly why the federal government cannot oversee what happens to its funds and why you have to have some kind of outside group looking at how its funded. NIMH is by far the weakest component of the National Institutes of Health. If you want to change to system, you need to do at least three things:

1. Funding needs to go out to the states, and we have to hold them accountable.
2. We have to recognize that these are brain diseases and that there are a large number of people who are going to have to be treated involuntarily because they are not aware they are sick.
3. Congress needs to finally require that NIMH does what it is supposed to have been doing all along. 


Stuart Butler
Heritage Foundation

When one thinks of the policy catastrophes we have seen in this country in the last fifty years, our dealings with mental health and with severe mental health must rank in the top four or five. The challenge now is to find a way of achieving Kennedy's vision. As the previous panelists have mentioned, our failings are large and varied. Why does our current system not function?

The system does not function well today because: There is, among policymakers, a profound misunderstanding and lack of knowledge about this issue, making it almost impossible to effectively solve the problem from both a logistical and financial point of view. We are unwilling to take a financial and political risk on an issue that we do not understand. There is also a large imbalance of political forces on the issue of mental health and severe mental illness - and it continues. There are very few policymakers that focus on the severely mentally ill. Yet there are far more who take the concerns of the worried well-their more "valuable constituents"-to heart. Thirdly, different agencies have a culture that is difficult to change. With an interest in pure science, NIMH's attempts to find a magic bullet cure do often work; but in the case of the mentally ill, it leads to the neglect of more practical approaches. And finally, there is the ever-present dilemma of federalism. A system of demands for public accountability by those who cannot see what is actually happening "on the ground" results in a structure of specific rules and measures of service that can be concretely measured. In other words, you have a large bureaucratic force that is not measuring the desired outcome. This type of system will not work for the mentally ill. 

What do we do? First, it is very important to have a better understanding and put an enormous amount of emphasis on measuring outcomes of our policy proposals. We must force a debate and a conclusion to help drive changes. Second, we must reconsider our view of federalism and reconstruct a system that measures outcomes and results, then decides where the money goes. And finally, as long as an employment-based insurance system persists, there will always be those who fall through the eligibility cracks. This system as a whole must be reconsidered.

In conclusion, the obstacles that lie before us are representative of the way in which the federal government does actually function, or rather dys-functions.

AEI research assistant Nell Manning prepared this summary.

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