American Journal of Law & Medicine

Community care, competition and coercion: a legal perspective on privatized mental health care. (Massachusetts) (Implementing U.S. Health Care Reform)


Legal reforms over the past two decades have advanced mental patient autonomy immeasurably. Stricter commitment standards preclude involuntary detention of mentally ill persons unless they pose an imminent danger to themselves or to others.(1) The same due process protections that safeguard the rights of criminal defendants, such as the right to a prompt hearing and the assistance of counsel, now govern deprivations of mental patient liberty.(2) The legal right to refuse unwanted medical treatment is firmly established.(3) Recently, the Fair Housing Amendments Act of 1988(4) and the Americans With Disabilities Act of 1990(5) opened doors for the mentally handicapped in the critical areas of housing and employment.

Indeed, some argue that mental patients today enjoy too much autonomy.(6) Viewing the growing numbers of mentally ill persons among the nation's homeless, the medical profession undoubtedly sees many in "need of treatment." In the name of promoting individual liberty, though, the legal system makes it next to impossible to treat them against their will. Frequently, legal reforms that restrict involuntary treatment are cited as the reason for deinstitutionalization's failure and the sorry plight of many with "nowhere to go."(7) However, it is pointless to lay the blame on greater patient autonomy when an adequate system of community care was never established for those released from state institutions in the 1960s and 1970s.(8) That is the real failure of deinstitutionalization.

Today, a Massachusetts administration sold on the virtues of privatization has embarked on an ambitious plan aimed at finally fulfilling the ideal of care in the community.(9) By closing outmoded state hospitals and transferring patients into community-based alternatives owned and operated by the private sector, Massachusetts seeks to create a more efficient and better quality system of care.(10) The Commonwealth's experiment is fraught with risk, but a bold new approach to mental health care is precisely what is needed. Serious mental illnesses like schizophrenia, manic-depressive psychosis, and severe depression impact the lives of nearly two million Americans and their families.(11) The policies of the past -- alternating between warehousing the mentally ill in state institutions and dumping them into unprepared communities -- depict a shameful failure. If wide-scale privatization is the answer, its hazards must be identified up front and fully accounted for in the final analysis.

The purpose of this Note is to evaluate those risks, emphasizing the impact of two decades of legal reform for a privatized mental health care system. Part II takes a brief look at the law's role in promoting patient autonomy and establishing a community model for mental health care. Part III examines both the promise and the peril, in today's legal environment, of achieving the community care ideal through privatization. Part IV explores the debate over coerced care and legislative reforms that might be considered essential to privatization's success. This Note ultimately embraces privatization for its potential to integrate many people with serious mental illness into the community, thereby giving them a chance at more fulfilling lives. If it is going to work, however, any savings it might generate must be reinvested into programs that can keep the mentally ill functioning in the community without denying them their hard-earned right to self-determination.


Every year nearly 1,500,000 people receive treatment in institutions

for the mentally ill and mentally retarded.... Many such hospitals

and homes have been shamefully understaffed, overcrowded, unpleasant

institutions from which death too often provided the only

firm hope of release.

The time has come for a bold new approach.

-President John F. Kennedy, 1963(12)


By the time President Kennedy called for the reform of America's mental health care system, it was indeed time for a change. The beginnings of a coherent national mental health policy came roughly 100 years earlier with the widespread construction of state hospitals.(13) At long last, mental illness was recognized as a disease requiring hospitalization. What began as great progress, however, in time evolved into a disgraceful symbol of the nation's failure to care for its mentally ill humanely. Because doctors understood little about mental illness through the first half of this century,(14) it remained largely untreated. For many, hospitalization was merely a euphemism for a lifetime of neglect in custodial confinement. Without any ability to cure or even treat mental illness, state hospital populations could only grow larger, reaching a peak of over one-half million people in the 1950s.(15) By then, reformers had already chronicled the horrors of abandoned and physically abused patients in overcrowded, understaffed, decrepit, and filthy state institutions.(16)

Virtually overnight, however, major advances in antipsychotic medications(17) supplied the impetus for a radically new approach to mental health care. In the 1950s, Thorazine was developed to treat schizophrenia, followed by lithium and antidepressants in the 1960s.(18) For the first time, significant alleviation of psychiatric symptoms was possible, leading psychiatrists and policymakers to conclude that severe mental illness could now be treated outside of state institutions.(19) In the midst of this optimism, Congress passed the Community Mental Health Centers ("CMHC") Construction Act(20) to supply federal funds for a system of community-based mental health services. The Kennedy administration hoped that CMHCs would eventually cut the state mental hospital population in half, allowing "the cold mercy of custodial isolation" to be supplanted by the "open warmth" of care in the community.(21)

The era of deinstitutionalization had arrived. Between 1955 and 1970, state mental hospital populations fell from over 550,000 to approximately 339,000 inpatients.(22) Still, many institutions remained indefensible warehouses for the mentally ill. Indeed, not until the legal reforms of the 1970s did the deinstitutionalization movement become fully entrenched.(23) Appalled that abuse and neglect continued to masquerade as "care" in most state hospitals, some reform-minded lawyers began questioning the very legitimacy of the psychiatric establishment.(24) Others were inspired by the achievements of the civil rights movement in advancing the legal standing of previously powerless minorities.(25) The result was a decade of precedent-setting lawsuits and revolutionary legislation. Aided in large part by the introduction of Medicaid, Supplemental Security Income ("SSI"), and Social Security Disability Income ("SSDI") -- which allowed the states to place patients in the community at the federal government's expense(26) -- the population of state mental hospitals plummeted to 130,000 by 1980.(27)

Legal reform proceeded on two fronts.(28) The first was the establishment of a "right to treatment,"(29) which was best articulated in the landmark case, Wyatt v. Stickney.(30) The plaintiffs in Wyatt set out to reform horrendous conditions at Alabama's state mental hospitals, where "injury, sickness, abuse, and misery were pervasive, and meaningful treatment was nonexistent."(31) A federal district court judge held that the state could not deprive mentally ill persons of liberty through involuntary commitment without providing "such individual treatment as will give them a realistic opportunity to be cured."(32) At a minimum, due process of law required a humane environment, qualified staff in numbers sufficient to meet patient need, and individualized treatment plans.(33)

While the constitutional theory supporting a right to treatment has never been certain,(34) Wyatt marks the genesis of judicial scrutiny of state mental institutions.(35) Unable to meet the costly minimum requirements imposed on it by the federal courts,(36) Alabama was forced to discharge thousands from its mental hospitals. A precedent was set that accelerated deinstitutionalization's pace nationwide, as state officials across the country recognized the fiscal impossibility of supplying minimally adequate care in huge state institutions.(37)

Even more significant, though, was the second avenue of legal reform -- litigation and legislation supplanting a "medical" model for civil commitment with a new "legal" model.(38) prior to the 1970s, paternalistic state laws authorized the involuntary detention of any person whom the medical profession deemed "in need of treatment."(39) States justified such a liberal commitment criterion as an exercise of their parens patriae power to act in the best interests of people incapacitated by mental illness.(40) To advocates for the mentally ill, however, the parens patriae rationale was no longer good enough. The "treatment" that states offered typically amounted to little more than imprisonment in deplorable state institutions. In tune with the philosophy of John Stuart Mill, lawyers argued that only an imminent danger to oneself or others was "sufficient warrant" for involuntary confinement.(41)

The court in Lessard v. Schmidt(42) agreed. Its decision radically altered the landscape of mental health law by: (1) defining a constitutional standard for commitment that required proof that the individual is both mentally ill and dangerous;(43) (2) imposing several criminal due process protections on the commitment process;(44) and (3) demanding proof that commitment was the least restrictive treatment alternative.(45) Lessard's legal model launched a sweeping trend toward stricter commitment criteria and greater procedural protection not only in the courts, but in the state legislatures as well.(46) By 1980, "dangerousness to self or others" had replaced the more lenient "in need of treatment" as the universal standard for involuntary civil commitment.(47) An overwhelming majority of states further required courts to select the "least restrictive alternative" form of treatment, precluding involuntary commitment unless the judge is satisfied that community-based treatment is either unavailable or unwarranted.(48)

Massive depopulation of state hospitals logically followed the implementation of this more stringent commitment scheme.(49) While those released may not have been dangerous, thousands remained seriously disabled. The lawyers and lawmakers whose reforms secured their release apparently assumed that adequate, community-based services either already existed or would arise to meet the need. They were wrong. The federally financed CMHCs mostly ignored serious illnesses like schizophrenia, choosing instead to focus on the less daunting task of providing counseling and psychotherapy to people described by one psychiatrist as the "worried well."(50)

Many more supervised, residential programs were needed for the seriously ill, but were often blocked by fierce community opposition and restrictive zoning laws. Scores of state hospital patients were released into the care of families who were ill-equipped to cope with the hallucinations and manic episodes that accompanied severe mental illness. Nursing homes, boarding houses, and single-room occupancy hotels furnished refuge, but were hardly an improvement over the state hospitals. In time, the criminal justice system was overwhelmed by the deinstitutionalized mentally ill. As the supply of low-income housing dwindled through the 1980s, many eventually wound up homeless. Studies now estimate that between thirty and forty percent of those living in the streets, parks, and subway platforms of America's cities are mentally ill.(51) Sadly, in many communities today, homeless shelters are de facto the largest providers of care for the mentally ill.


Conventional wisdom, therefore, views deinstitutionalization as an abject failure -- one of the "lunacies of government."(52) However, community-based mental health care is not an inherently unworkable concept, but one that was never seriously attempted.(53) Brewster v. Dukakis(54) stands out as a partial exception to the general rule that the states failed to establish adequate community services and supportive living arrangements for the thousands released from institutions. In this federal class action, mental patient advocates sought to force the state's hand by arguing that Massachusetts had a legal duty to create and maintain less restrictive community programs for the plaintiffs committed to the Northampton State Hospital.(55) While the legal basis for the suit was tenuous at best,(56) Governor Dukakis's administration acknowledged the desperate need for enhanced community care. Rather than "defend the indefensible,"(57) Massachusetts officials joined with representatives for the plaintiffs in formulating a consent decree that created the most comprehensive plan for the provision of community mental health services in the country.(58)

The Brewster decree recognized that a complete community mental health system consists of three interrelated components. First, the decree ordered the creation of new residences and acute-care beds in private general hospitals to provide former state hospital patients care in their own communities.(59) Second, it established treatment, training, and support programs to ensure that the clients transferred into the community continue to function there successfully.(60) Finally, the Brewster decree included management services to develop, coordinate, administer, monitor, and evaluate the network of community programs adequately.(61) Five years after court approval made the decree a binding order, funding of community services for the Brewster plaintiffs had increased tenfold.(62) As a result, hundreds of people discharged from the Northampton Hospital were provided care in fully staffed residential and nonresidential programs.

The 1970s saw a proliferation of "institutional suits" like Brewster that sought to reform state prisons, school systems, and mental hospitals through federal court decree.(63) The ability to achieve an adequate system of community-based mental health care through such litigation, however, is quite limited. Indeed, the services established in Brewster were available only to members of a narrowly defined plaintiff class in Western Massachusetts. In other parts of the Commonwealth, community care remained inadequate.(64)

While the plaintiff class can usually be expanded to encompass a greater number of persons, the constitutional legitimacy of such suits poses a much more fundamental obstacle. Unlike the various state legislatures, the Supreme Court has never recognized a constitutional right to treatment in the least restrictive alternative setting.(65) Moreover, institutional reform law suits involve nonelected judges who make discretionary political decisions that allocate the state's scarce resources.(66) Accordingly, the rule in such suits is one of judicial restraint; courts will typically usurp the functions of a state's political system only in egregious cases, in which that system cannot or will not provide an adequate remedy.(67)

Furthermore, because judges have no authority over state funding, a reluctant governor or unwilling legislature can easily frustrate the implementation of any court order. Such opposition arose in response to Brewster when a new governor and the legislature (who was not a party in the suit and, thus, not bound by the order) blocked funding for programs that they considered too expensive.(68) Similarly, fifteen years of litigation in the District of Columbia has failed to create an adequate system of community care.(69) Ultimately, political will remains the key to any meaningful mental health care reform beyond bare and uncertain constitutional minimums.


Today in Massachusetts, a new administration that is committed to reform proposes privatization as the answer to fulfilling at last the long, broken promise of care in the community. …

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