By Stephen Eide

“Trans-institutionalization” refers to the shift of seriously mentally ill adults from the care of psychiatric institutions to correctional institutions. Beginning in the 1950s, public mental health agencies have pursued the deinstitutionalization of the seriously mentally ill. These government agencies intended to meet that goal through creating a system of community-based care to replace the asylum-based systems. Deinstitutionalization did not succeed as planned. Consequently, jails and prisons became the custodians of hundreds of thousands of seriously mentally ill adults who in previous eras would have been committed to an asylum.

Some dispute the magnitude of trans-institutionalization. But no one denies the high rate of serious mental illness among the incarcerated, or that jails and prisons are poor settings in which to treat serious mental illness. Correctional mental health care now stands as one of the most important mental health care systems in the nation. Jails and prisons are legally obligated to serve the seriously mentally ill, whereas community-based systems are not. More effective community-based mental health remains an important goal to pursue. But equally important is the reform of corrections-based systems. Better correctional mental health care systems will benefit both community systems and the seriously mentally ill themselves.

This report will explain how corrections-based systems function. It will place those systems in the context of debates around “jail abolition,” explain their workforce and financial challenges, and recommend the following reforms:

1. State governments should assume more responsibility for funding jail-based mental health care.

2. Correctional mental health systems have special responsibility to the seriously mentally ill and are justified in targeting resources accordingly.

3. Collect, keep, and report better data.

4. Repeal Medicaid’s Institution for Mental Diseases (IMD) exclusion.

5. Correctional institutions should make more use of long-acting injectables during discharge.

6. Eliminate overuse of administrative segregation (solitary confinement); do not abolish it.

7. Do not use telehealth when reliance on onsite clinical staff is feasible.

New York: Manhattan Institute, 2024. 28p.