Placement of mentally ill individuals in nursing homes: Today’s legal warfare

Behavioral health advocates in four states have filed litigation arguing that mentally ill individuals should not be placed in nursing homes and would be better served in community-based facilities or by services provided at home—and stirred up a controversy. Community placement might be appropriate for some individuals, say nursing home industry representatives, but such alternative facilities simply aren’t available, and nursing homes are capable of providing needed care.

In 1999, the Supreme Court ruled in Olmstead v. L.C. and E.W. that, under the Americans with Disabilities Act, states can be required to place Medicaid-funded patients in their least restrictive settings, e.g., those with mental disabilities in community settings rather than in institutions such as nursing homes. The key issues in placement, according to the court, are:

  • Do treatment professionals think that community placement is appropriate?

  • Does the individual oppose transfer to a less restrictive setting?

  • Can placement be reasonably accommodated, taking into account the resources available to the state and the needs of others with similar disabilities?

Four subsequent lawsuits have made it clear that the Supreme Court’s ruling did not end the legal controversy. In the first lawsuit, filed in August 2005, the American Civil Liberties Union (ACLU) of Illinois, along with the Bazelon Center for Mental Health Law, the group Equip for Equality, and the law firm of Kirkland & Ellis, alleged that four residents of nursing homes were being needlessly segregated and inappropriately warehoused in violation of federal law. The ACLU is seeking class action status for the plaintiffs against nursing homes that serve as “institutions for mental diseases” (IMDs), according to lead attorney Benjamin Wolf. “Many, if not all, of the persons at these facilities could be served in more integrated settings in the community,” Wolf asserts. “However,” he adds, “as a country, we have been slow to make those accommodations for individuals with mental illnesses.”

Inappropriate placement of mentally ill patients should be avoided whenever possible, agrees nursing home CEO Melvin Siegel, chairman of the legislative committee of the Illinois Nursing Home Administrators Association. However, he notes, economic issues, relative availability of facilities, and lack of community acceptance of people with mental illnesses often leave no choice but to place such individuals in nursing homes. Siegel adds that many nursing home residents could not function in smaller community-based settings without a significant increase in staffing. “They need a degree of assistance and supervision that’s not feasible in community facilities, without a significant increase in costs,” he explains. Without such assistance and supervision, for example, mentally ill individuals would not be able to carry out daily living activities, take their medications as needed, or eat properly.

That’s a particular problem with for persons who suffer from co-occurring diabetes and mental illness, notes Siegel, with each condition when uncontrolled worsening the other. Siegel also cites the sociological problem of communities opposing mental health facilities’ being placed in their areas or permitting nursing home residents with mental illnesses to be allowed to go out unaccompanied—in other words, the NIMBY (not in my backyard) phenomenon.

In a second lawsuit, filed in February 2006, the state of Connecticut was accused of forcing psychiatric patients into nursing homes when community living would have provided more suitable alternatives. Connecticut Lt. Gov. Kevin Sullivan is now championing efforts to ensure that persons with mental illnesses are placed in community-based facilities rather than nursing homes on grounds that nursing home beds are far more costly than home or community care. He says that the situation that prompted the lawsuit is “wrong as a matter of law and as a matter of smart public policy. Nursing homes do not provide effective care and recovery for the non-geriatric mental health patients who are trapped there”—and, he adds, it shouldn’t take a lawsuit to make Connecticut do “the right thing.”

Indeed, says Margaret Morelli, president of the Connecticut Association of Not-for-Profit Providers, the issue of inappropriate placement of persons with mental illness has been on the radar of Connecticut nursing homes for a long time. “While nursing homes are aware of the lawsuit,” she says, “they have not taken it personally and don’t see themselves as the target of the current litigation. Nursing home placement may not be ideal for some persons with mental illness,” she says, but “they all receive good care. It just might not have been best placement.” Inappropriate placement might happen, she suggests, because other options aren’t available or community-based services haven’t been fully implemented.

In March 2006, litigation was filed by the Bazelon Center for Mental Health Law, Disability Advocates, and New York Lawyers for the Public Interest, among others, claiming that New York State officials violated the Americans with Disabilities Act by transferring mentally ill patients from state psychiatric hospitals into locked nursing home units.

Finally, in October 2006, six residents of Laguna Honda Hospital in San Francisco filed suit seeking release to home- and community-based resources they claimed were readily available in the city and a reasonable alternative to an expensive planned replacement facility.

The Overview

While the facts in these four lawsuits differ, they all seek more appropriate placement for persons with mental illnesses, observes Jennifer Mathis, deputy legal director of the Bazelon Center. “Nursing homes are not designed to serve that population. They’re set up to serve people with more intensive healthcare needs,” Mathis says, and, for the most part, people with mental illnesses do not fall into that category. “These are not people who are walking around with IVs,” she notes.

In general, these patients are capable of being in the community and living normal lives—but, she observes, “it appears that states are moving backward rather than forward in warehousing people.”

Experts point to recent federal nursing home legislation such as PASARR (Pre-Admission Screening and Annual Resident Review). Under PASARR, nursing facilities are prohibited from admitting an individual with a serious mental illness unless the state mental health authority (SMHA) has determined that the individual requires the level of medical services the facility provides. Two levels of screening are required to identify persons with a serious mental illness and the clinical services those persons require. But several recent studies have raised questions about the effectiveness of the PASARR process.

On that front, the federal Office of Inspector General (OIG) recently concluded that, while “inconsistent data” make it impossible to determine accurately the number of mentally ill persons being housed in nursing homes, as many as 20% of the residents of such facilities may have some form of mental disorder. Many states are not doing enough, says the OIG, to identify, screen, or treat younger adults (ages 22 to 64) with mental illnesses who are in nursing facilities. Access to mental health services within nursing facilities also appears to be a problem, the OIG concluded, with as many as half of the nursing homes studied unable to provide adequate psychiatric consultation for their residents.


From the data available, one thing seems clear: Current litigation is unlikely to end the policy debate over nursing home placement for mentally ill persons—but it may go a long way toward clarifying the legal responsibilities of state health officials to provide appropriately targeted care for the mentally ill and to generate needed tax-supported resources. Stay tuned to see if nursing homes are kept on or off the hook.

Michael Levin-Epstein is an independent writer based in North Potomac, Maryland

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