Community-Based Mental Health Services are
Under-Funded

The National Mental Health Association (NMHA) is deeply concerned about the outlook for mental health funding in the upcoming fiscal year.  Despite profound unmet needs, communities across the country face the prospect of funding cuts in mental health programs for FY 2002.  NMHA urges Members of Congress to produce a Labor, HHS Appropriations bill that does not come at the expense of people living with or at risk of mental illness. 

Funding for community-based mental health services in real dollars has actually declined in recent years.  This widening deficit exists even though research demonstrates that mental health treatment is effective and yields benefits for individuals, families and society as a whole.  The U.S. Supreme Court in Olmstead v. LC mandates that states develop adequate community services to move people with disabilities out of institutions.  Without increased funding, however, efforts to transition people out of institutions and better serve those currently living in our communities will continue to fail.

Funding for community-based services in real dollars has declined in recent years.  This increasing deficit exists even though research proves that treatment is effective.

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Research Shows that Mental Health is Under Funded

  • In 1997, mental health and substance abuse expenditures represented only 7.8 percent of the more than $1 trillion of all U.S. healthcare expenditures.  This is a decrease from 8.8 percent in 1987.[1]
  • The overall real purchasing power for state mental health appropriations between 1955 and 1997 declined from $16.5 billion to $ 11.5 billion.[2]
  • Mental illness is the second leading cause of disability in the U.S.[3], yet only 7 percent of all healthcare expenditures are designated for mental health disorders.[4]

Action Needed to Protect and Expand Mental Health Services

NMHA urges Congress to increase funding for mental health services in the FY 2002 appropriations bill and support the following mental health initiatives:

  • Mental Health Block Grant – NMHA calls for increases in the block grant from $420 million to $670 million to provide much needed funding for community-based mental health services.
  • CMHS Youth Anti-Violence Initiative – NMHA calls for an increase in funding from $90 million to $150 million to enable more school districts to mount youth violence prevention programs.
  • Children’s Mental Health Services Program – NMHA calls for an increase in funding from $92 million to $140 million so that more communities can establish programs to provide services to children with serious emotional disorders (SED).
  • Programs of Regional and National Significance – NMHA calls for an increase in funding for Programs of Regional and National Significance that help to translate research on effective treatment interventions into practice.  The Administration proposes to cut this program by $16 million but funding should be restored to its $197 million FY 2001 level.

Contact NMHA for More Information

For more information on mental health issues in the FY 2002 budget, contact Julio Abreu, Director of Government Affairs at (202) 675-8412.

Established in 1909 by former psychiatric patient Clifford W. Beers, the National Mental Health Association is the only national organization dedicated to addressing all aspects of mental health and mental illnesses.



[1] U. S Department of Health and Human Services. (2000). National Expenditures for Mental Health and Substance Abuse Treatment, 1997.

[2] Under Court Order: What the Community Integration Mandate Means for People with Mental Illness. The Supreme Court Ruling in Olmstead v. L.C. Bazelon Center for Mental Health Law, 1999. 

3 World Health Organization, 1990. www.who.int/msa/mnh/ems/dalys/intro.htm.

4 Substance Abuse and Mental Health Services Administraion, 1997.