Many “mental institutions” (especially large state psychiatric hospitals and asylums) were closed mainly because of a mid‑20th‑century shift toward deinstitutionalization : the idea that most people with mental illness should live in the community, not in locked, long‑term institutions.

Big picture: why they were closed

Several forces came together over decades:

  • New psychiatric medications
    • From the 1950s onward, antipsychotic and other psychotropic drugs made it more realistic for many patients to live outside locked wards, at least in theory.
* As patients stabilized and lengths of stay shrank, politicians and administrators questioned the cost of keeping huge institutions open.
  • Horrific conditions and human‑rights critiques
    • Exposés in the 1960s–1970s showed overcrowding, abuse, and neglect in many state hospitals and asylums, fueling activist and legal movements that framed long‑term warehousing as a civil‑rights violation.
* Court decisions in the U.S. and Europe increasingly supported patients’ rights to the “least restrictive setting,” pushing systems away from locked institutions.
  • Deinstitutionalization policies and laws
    • Governments adopted explicit policies to move people out of hospitals into community‑based care: outpatient clinics, group homes, supported housing, day programs.
* In the U.S., this was tied to federal programs (like Medicaid/Medicare) and state laws that tightened involuntary commitment standards, making long‑term institutionalization harder unless someone was an immediate danger.
  • Financial and political incentives
    • Large state hospitals were extremely expensive to run; shifting people into community settings was sold as both more humane and more cost‑effective.
* Over time, fiscal pressures and budget cuts meant beds were closed faster than robust community services were built, leaving big gaps in care.

What was “supposed” to replace them

On paper, deinstitutionalization was not just “empty the asylums”; it was meant to:

  1. Reduce or close big institutions and reallocate funds.
  2. Build a “continuum of care” in the community:
    • Outpatient psychiatry and counseling
    • Crisis services and short‑stay inpatient units
    • Supported housing and vocational programs
    • Case management and social supports

In practice, many countries and U.S. states closed or downsized hospitals but never fully funded the promised community system.

Unintended consequences people talk about today

This is why, in current news and forum debates, you’ll see arguments like “we closed the asylums and created homelessness and mass incarceration”:

  • Homelessness and street mental illness
    • A significant number of people with serious mental illness ended up cycling between shelters, streets, brief hospitalizations, and family couches because community services were insufficient or hard to access.
  • “Jails as the new asylums”
    • Large U.S. jail systems (like Los Angeles County Jail or Rikers Island) now house huge numbers of people with serious mental illnesses; critics say the carceral system effectively replaced old hospitals for many.
  • Fragmented, short‑term care
    • Instead of long‑term institutions, many people now only get 24–72‑hour crisis holds, then are discharged without stable housing or ongoing support.

Researchers and advocates increasingly describe this as “deinstitutionalization done halfway” : the institutions were closed or shrunk, but the intended robust, rights‑respecting community system never fully materialized.

Different viewpoints in today’s discussion

You’ll see a few main camps in current debates, including on forums and in recent long‑form reporting:

  • Pro‑deinstitutionalization, but “finish the job”
    • Argument: Closing abusive, warehousing institutions was morally right; the failure is that governments underfunded community care and housing.
* Policy ask: invest heavily in supported housing, assertive community treatment, and integrated social services, not a return to old asylums.
  • Critical of closures: “we went too far”
    • Argument: In trying to avoid involuntary long‑term care, systems abandoned people who truly need secure, structured environments.
* Policy ask: rebuild a spectrum of residential options, including more long‑term psychiatric beds with strong oversight and rights protections.
  • Nuanced middle view
    • Argument: Some long‑term facilities are necessary, but they must be smaller, humane, and integrated with community services, not the isolated “asylum on a hill.”
* Emphasis on patient choice, trauma‑informed care, and strong accountability.

“Quick Scoop” style wrap‑up

To directly tie back to “why were mental institutions closed” as a trending discussion:

  • They were closed or downsized because:
    • New meds and therapies made community living seem possible.
* Abuse and neglect scandals made big asylums politically and morally indefensible.

* Laws and policies shifted toward civil rights and least‑restrictive care.

* Governments wanted to cut costs and move away from massive state‑run institutions.
  • The core controversy today is not whether abuse in old institutions was real (it was), but whether society ever built the safe, well‑funded community system that was promised to replace them.

Many people on forums now frame it this way: “We didn’t so much ‘fix’ the asylum problem as move it—onto sidewalks, into ERs, and behind bars.”

TL;DR: Mental institutions were closed in a wave of deinstitutionalization driven by new medications, civil‑rights concerns, and cost pressures, but the follow‑through on community‑based care was often weak—creating the crisis many people now see on the streets and in jails.

Information gathered from public forums or data available on the internet and portrayed here.