The Effects of Budget Cuts on the Public’s Mental Health

by Project Censored
Published: Last Updated on

By all indications, the United States public mental health system is in shambles.  Studies have shown that one in every four Americans, or 57.7 million people, meet the diagnostic criteria for a mental illness every year. This makes the U.S. number one as far as the rate of mental illness among its citizens.  Yet, in the richest country in the world, according to multiple studies, less than half of those diagnosed with mental illnesses receive proper treatment for their illness.  Also, 90% of seriously mentally ill people have trouble ever obtaining a job, which costs the country $25 billion annually. These statistics are mindboggling and unsettling: millions of Americans are living their day-to-day lives with serious mental health problems and are not receiving the treatment they need. The natural question that comes to mind is, why? The answer is neither simple nor straightforward.

Federal and state budget cuts have created serious problems for public mental health  programs. In 2012, $1.6 billion was cut for mental health programs at the state level. As a result, more pressure has been put on such programs to provide quick and efficient treatments for victims of mental illness.  Billions of dollars are spent on developing new drugs that are just as effective as older drugs while funding for treatment programs with documented effectiveness is mercilessly cut.  Standard treatment for many serious mental diseases is a combination of psychotherapy and drug treatment as needed. With the cutbacks, providers are forced to push primarily drug treatment, which when used alone is less effective and more expensive over time. Multiple studies have found that dual-care, involving therapy and drug treatment, is much more effective than either of those separately. Also, those that are on sole treatment plans tend to relapse more frequently than those on dual treatment plans.

Medicaid itself is caught in the great divide between mental health treatment programs and drug companies. Proposed budget cuts of $50 million in 2009 by President Bush jeopardize the funding of several effective mental health interventions, such as case management, while day-treatment programs, used exclusively to store away mentally ill people, gain funding. Separate streams of funding, different opinions on what treatment is better, and the struggle between the two treatment modalities (drugs versus psychosocial treatment) for funding through Medicaid all create this chasm between mental healthcare programs and drug programs.

Since mental illness is common enough to affect virtually every family sooner or later, it is our nation’s responsibility to address the current crisis in public mental healthcare. Some states and Medicaid officials have begun to create integrated drug-therapy programs that could have major effects on the well-being of thousands. Progressive laws, such as New York state’s Timothy’s law which came into effect in 2007, are a good start, but we need far greater reforms.  For many, it is a matter of life or death.


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Honberg, R., Kimball, A., Sita, D., Usher, L. & Fitzpatrick, M. (2011). “States Mental health Cuts: The Continuing Crisis.” The National Alliance on Mental Illness. Retrieved on  3/12/2012 at

Levine, Art. (2012). “America’s Mental health Care System in Shambles.” The American Prospect. Washington, D.C.: The American Prospect. PP 1-5.
“Mental Illness: Facts and Numbers.” The National Alliance on Mental Illness. (2009). Retrieved on 3/12/2012 at
Student Researchers: Tara Kelly, Meghan Peek & Patrick Sheehan, Siena College
Faculty Advisor: Dr. Maureen Hannah, Siena College