Mental Health Diversion Programs in America

Mental health diversion programs in America examines how specialty courts and intercept models redirect people with mental illness from jail. The criminalization of mental illness—the systematic funneling of individuals with serious psychiatric conditions into jails and prisons rather than treatment settings—has become one of the defining failures of American social policy. The closure of state psychiatric hospitals since the 1960s transferred hundreds of thousands of individuals with serious mental illness into communities that lacked the treatment infrastructure to serve them, and the criminal justice system became the default institutional response to the behavioral crises, homelessness, substance use, and survival offending that untreated mental illness produces. This article, part of the Clinical Criminology section of the broader Criminology resource, examines the major diversion models that have been developed to redirect individuals with mental illness from criminal justice processing to treatment, evaluates their effectiveness, and assesses the systemic challenges that limit their reach and impact.

Introduction

The scale of mental illness in American jails and prisons is staggering. The Bureau of Justice Statistics estimates that approximately 37 percent of state and federal prisoners and 44 percent of jail inmates have been diagnosed with a mental health condition. The Los Angeles County jail system, Cook County Jail in Chicago, and the Rikers Island complex in New York have each been identified at various points as the largest providers of mental health services in their respective states—a distinction that reflects the failure of community mental health systems rather than any therapeutic capacity of correctional institutions. Individuals with serious mental illness cycle through jails at rates far exceeding their representation in the general population, accumulating criminal records, losing housing and benefits, and experiencing the trauma and violence of incarceration that exacerbates rather than addresses their psychiatric conditions (Torrey et al., 2010).

The development of mental health diversion programs represents the criminal justice system’s most sustained effort to address this crisis. Diversion programs operate at multiple points in the justice process—from pre-arrest police encounters through pretrial screening, specialty court adjudication, and post-sentencing reentry—redirecting individuals with mental illness from criminal processing to treatment and support services. The Sequential Intercept Model, developed by Mark Munetz and Patricia Griffin, provides the conceptual framework organizing these interventions along the criminal justice trajectory, identifying five intercept points at which diversion can occur and the institutional mechanisms appropriate to each (Munetz & Griffin, 2006).

The Sequential Intercept Model

Pre-Arrest Diversion (Intercepts 0 and 1)

Pre-arrest diversion prevents individuals with mental illness from entering the criminal justice system by intervening during or before the police encounter that would otherwise result in arrest. Crisis Intervention Teams (CIT)—the most widely implemented pre-arrest diversion model—train selected police officers in mental health crisis recognition, de-escalation techniques, and community mental health resources, enabling them to resolve encounters with individuals in psychiatric crisis through referral to treatment rather than arrest. The Memphis CIT model, developed in 1988 following the fatal police shooting of a man experiencing a mental health crisis, has been adopted by more than 2,700 law enforcement agencies nationwide and has become the dominant police-based mental health response model in the United States (Watson, Compton, & Draine, 2017).

Research on CIT effectiveness has produced generally positive findings for process outcomes—CIT-trained officers are more likely to transport individuals to treatment facilities rather than jail, use less force during mental health encounters, and report greater confidence in handling psychiatric crises—though the evidence for downstream outcomes such as reduced arrests, reduced jail bookings, and improved mental health outcomes among persons contacted is more limited and methodologically weaker. The variability in CIT implementation across agencies complicates evaluation: some agencies train a dedicated cadre of officers who respond to all mental health calls, while others provide training to patrol officers who encounter mental health crises in the course of routine duties. The former model ensures that trained officers handle the most complex cases; the latter ensures broader coverage but may dilute the specialized response that the model envisions (Compton et al., 2014).

Co-responder models—in which mental health clinicians accompany or are dispatched alongside police officers to mental health calls—represent a more clinically intensive form of pre-arrest diversion. Programs such as the CAHOOTS model in Eugene, Oregon, dispatch mental health workers and medics rather than police officers to non-violent behavioral health calls, removing law enforcement from encounters where clinical rather than enforcement expertise is needed. The expansion of co-responder and alternative response programs has accelerated since 2020, driven by public demands for alternatives to police response for mental health crises and by evidence that clinician-led responses achieve resolution without arrest, use of force, or emergency department transport in the large majority of cases (Watson et al., 2017).

Post-Arrest Diversion (Intercepts 2 and 3)

Post-arrest diversion redirects individuals with mental illness from criminal prosecution to treatment after they have been booked into jail. Jail-based screening programs identify individuals with mental health conditions at booking and refer them to pretrial diversion programs, mental health courts, or supervised treatment in lieu of prosecution. The effectiveness of jail screening depends on the quality of the screening instrument, the training of booking staff, and the availability of community treatment resources to which screened individuals can be referred—a chain of requirements in which the weakest link determines the system’s capacity to divert (Steadman et al., 2009).

Mental health courts—the most extensively studied post-arrest diversion mechanism—are specialized court dockets that handle cases involving defendants with mental illness through a therapeutic rather than adversarial process. Typically, eligible defendants are identified through screening at booking or referral by defense attorneys, prosecutors, or judges; they agree to participate voluntarily; and they enter a program of court-supervised treatment that includes regular judicial status hearings, case management, mental health treatment, substance abuse treatment where applicable, and housing and employment assistance. Successful completion results in dismissal or reduction of charges; non-compliance triggers graduated sanctions that may include short jail stays but that aim to maintain treatment engagement rather than impose punishment (Sarteschi, Vaughn, & Kim, 2011).

The research on mental health court effectiveness is more extensive than for most specialty court types. Multiple quasi-experimental studies and several randomized trials have documented significant reductions in rearrest and reincarceration among mental health court participants compared to defendants processed through conventional courts. A meta-analysis by Sarteschi and colleagues (2011) found that mental health court participation was associated with reduced recidivism across studies, with effect sizes comparable to those reported for drug courts. Participants also showed improvements in mental health functioning, housing stability, and quality of life, though the mechanisms of these improvements—whether attributable to the court structure, the treatment services, the judicial monitoring, or some combination—remain debated (Steadman et al., 2011).

Program Models and Variation

Mental Health Courts: Structure and Operation

Mental health courts vary considerably in their eligibility criteria, program structure, and operational philosophy. Some courts accept only defendants with serious mental illness (schizophrenia, bipolar disorder, major depression); others accept a broader range of mental health conditions including anxiety disorders, PTSD, and personality disorders. Some courts limit eligibility to misdemeanor charges; others accept felony cases, including violent felonies where the defendant’s mental illness is closely linked to the offense behavior. Some courts require guilty pleas as a condition of participation; others defer adjudication pending program completion. These structural variations reflect local legal cultures, resource availability, and the philosophical orientations of the judges and stakeholders who design and operate each court (Redlich, Steadman, Monahan, Robbins, & Petrila, 2006).

The judicial role in mental health courts is distinctive and has attracted both praise and criticism. Mental health court judges typically adopt a therapeutic rather than adversarial stance, engaging directly with participants during status hearings, offering encouragement and praise for progress, expressing concern about setbacks, and using their authority to motivate treatment compliance. This therapeutic judicial orientation has been credited with creating the sustained motivation and accountability that enable participants to engage in treatment over the extended periods that serious mental illness requires. Critics have raised concerns about the expansion of judicial authority into clinical domains, the coercive potential of court-ordered treatment, and the due process implications of a system in which the judge functions simultaneously as adjudicator and treatment supervisor (Redlich et al., 2006).

The sustainability of mental health courts depends on the availability of community treatment resources—a dependency that makes the courts vulnerable to the chronic underfunding of public mental health systems. Courts that operate in communities with adequate psychiatric services, supportive housing, substance abuse treatment, and case management capacity achieve better outcomes than those operating where these resources are scarce. The irony of mental health diversion is that its success requires precisely the community treatment infrastructure whose absence drove the criminalization of mental illness in the first place—a structural contradiction that limits the capacity of diversion programs to address the problem at scale (Steadman et al., 2011).

Jail Diversion and Forensic Assertive Community Treatment

Jail diversion programs that operate independently of mental health courts provide alternative pathways for redirecting individuals with mental illness from incarceration to treatment. Pretrial jail diversion programs negotiate with prosecutors and judges to release eligible defendants to supervised treatment in lieu of pretrial detention, monitoring compliance through case management and reporting back to the court on treatment progress. Post-booking diversion programs screen jail inmates for mental illness and connect them with community treatment upon release, often through forensic case managers who provide intensive support during the transition from jail to community (Steadman et al., 2009).

Forensic Assertive Community Treatment (FACT) adapts the Assertive Community Treatment (ACT) model—an evidence-based practice for individuals with serious mental illness characterized by multidisciplinary teams, low client-to-staff ratios, 24/7 availability, and community-based service delivery—for the specific needs of justice-involved individuals with mental illness. FACT teams combine the clinical intensity of ACT with the criminal justice expertise necessary to interface with courts, probation, and corrections, providing the sustained treatment engagement and crisis response capacity that this population requires. Research on FACT has documented reductions in hospitalization, incarceration, and homelessness among participants, though the high cost of ACT-model services limits their scalability (Lamberti et al., 2004).

The Forensic Intensive Case Management (FICM) model provides a less resource-intensive alternative to FACT for individuals whose needs do not require the full ACT team structure. FICM programs assign dedicated forensic case managers—typically with caseloads of 15–25 clients—who provide mental health service coordination, housing assistance, benefits navigation, substance abuse referral, and ongoing contact with criminal justice authorities to monitor compliance and advocate for their clients. The evidence base for FICM is growing, with several studies documenting reduced recidivism and improved treatment engagement among participants, though the heterogeneity of program models and outcome measures limits definitive conclusions about effectiveness (Steadman et al., 2009).

Effectiveness and Limitations

Evidence on Outcomes

The evidence on the effectiveness of mental health diversion programs has strengthened considerably over the past two decades, moving from descriptive program evaluations to quasi-experimental studies and, increasingly, randomized controlled trials. The most rigorous evidence supports the effectiveness of mental health courts in reducing recidivism: the randomized trial conducted by Steadman and colleagues (2011) in four U.S. mental health courts found that participants experienced significantly fewer days of incarceration over an 18-month follow-up period compared to defendants processed through conventional courts. Quasi-experimental studies have replicated these findings across diverse court models and jurisdictions, providing a reasonably strong evidence base for the court-based diversion model (Sarteschi et al., 2011).

The evidence for pre-arrest diversion (CIT and co-responder models) is more limited but generally positive for immediate process outcomes—reduced arrests, reduced use of force, increased treatment referral—while the evidence for longer-term outcomes such as reduced criminal justice involvement and improved mental health functioning is less clear. The methodological challenges of evaluating pre-arrest diversion are significant: randomizing police encounters is generally infeasible, selection effects complicate quasi-experimental comparisons, and the outcomes of interest—recidivism, hospitalization, housing stability—require long follow-up periods that most evaluations have not achieved (Watson et al., 2017).

The critical limitation of the diversion evidence base is that nearly all evaluation research focuses on the individuals who are successfully diverted, without addressing the far larger population of justice-involved individuals with mental illness who are never identified, never referred, or never accepted into diversion programs. Mental health courts typically serve small numbers of participants—often fewer than 100 per court at any given time—relative to the thousands of individuals with mental illness cycling through the jails and courts of the same jurisdiction. The scale mismatch between the problem and the programmatic response means that even effective diversion programs address only a fraction of the need, leaving the systemic drivers of criminalization largely unaddressed (Torrey et al., 2010).

Systemic Barriers

The most fundamental barrier to effective mental health diversion is the chronic underfunding of community mental health services that created the criminalization crisis in the first place. Diversion programs can redirect individuals from criminal justice processing to treatment, but only if treatment exists, is accessible, and is adequate to address the complex needs of individuals with serious mental illness, co-occurring substance use disorders, histories of trauma, homelessness, and chronic poverty. In communities where public mental health systems are overwhelmed, understaffed, and underfunded—which describes most American communities—diversion programs face the structural impossibility of diverting individuals to services that do not exist at sufficient capacity (Lamb & Weinberger, 2005).

Housing represents a particularly critical barrier. Individuals with serious mental illness who are released from jail without stable housing are at dramatically elevated risk of psychiatric crisis, substance use relapse, treatment disengagement, and re-arrest—a cycle that diversion programs cannot break without access to supportive housing that provides both residential stability and on-site mental health services. The Housing First model, which provides permanent supportive housing without requiring sobriety or treatment compliance as preconditions for housing, has demonstrated effectiveness in reducing homelessness and criminal justice involvement among individuals with serious mental illness, but the availability of Housing First units falls far short of the need in virtually every American city (Steadman et al., 2011).

The fragmentation of the American service delivery system—with mental health, substance abuse, housing, employment, benefits administration, and criminal justice operating through separate agencies with different funding streams, eligibility criteria, and institutional cultures—creates coordination challenges that individual diversion programs cannot resolve. Individuals with serious mental illness who are involved in the criminal justice system require services from multiple systems simultaneously, and the absence of integrated service delivery means that case managers must manage across organizational boundaries that were not designed for coordination. The Stepping Up Initiative, launched by the National Association of Counties in partnership with the Council of State Governments and the American Psychiatric Association, seeks to address this fragmentation through county-level planning and coordination, but systemic change at this scale requires political will and financial investment that most jurisdictions have not sustained (Munetz & Griffin, 2006).

Substance Use Comorbidity and Dual Diagnosis

Co-Occurring Disorders in Justice-Involved Populations

The majority of individuals with serious mental illness in the criminal justice system also have co-occurring substance use disorders—a clinical reality that complicates assessment, treatment planning, and diversion programming. Estimates of comorbidity among justice-involved individuals with mental illness range from 50 to 75 percent, depending on the population studied and the diagnostic criteria applied. The co-occurrence of mental illness and substance use creates a synergistic risk profile in which each condition exacerbates the other: untreated mental illness increases the likelihood of substance use as self-medication, while substance use worsens psychiatric symptoms, reduces treatment compliance, and increases the behavioral dysregulation that leads to criminal justice contact (Drake, Mueser, Brunette, & McHugo, 2004).

Diversion programs that address mental illness without simultaneously addressing substance use are unlikely to produce sustained reductions in criminal justice involvement, because the substance use that drives much of the criminal behavior associated with mental illness remains unaddressed. Integrated treatment models—which address mental health and substance use within a single treatment framework rather than requiring individuals to engage with separate and often poorly coordinated service systems—have demonstrated superior outcomes to sequential or parallel treatment models for individuals with co-occurring disorders. The Integrated Dual Diagnosis Treatment (IDDT) model, designated as an evidence-based practice by SAMHSA, combines psychiatric medication management, substance abuse counseling, motivational interviewing, and peer support within a unified treatment team (Drake et al., 2004).

Mental health courts that have adopted integrated co-occurring disorder treatment protocols report better outcomes than those that address mental health and substance use through separate referrals to different treatment providers. The integration challenge is significant, however, because the mental health and substance abuse treatment systems in most American communities operate through different funding streams, different licensing and credentialing systems, different treatment philosophies, and different organizational cultures. Achieving true integration requires structural reforms—including cross-training of staff, blended funding, unified clinical supervision, and outcome measures that capture both mental health and substance use outcomes—that most communities have not yet implemented at scale (Osher & Steadman, 2007).

Medication-Assisted Treatment in Diversion

Medication-assisted treatment (MAT) for opioid use disorder—using methadone, buprenorphine, or naltrexone in combination with behavioral therapy—has strong evidence of effectiveness in reducing opioid use, overdose mortality, and criminal behavior. For justice-involved individuals with co-occurring mental illness and opioid use disorder, access to MAT during and after incarceration is critical for preventing the relapse and overdose that frequently occur during the high-risk reentry period. Research demonstrates that individuals who receive MAT during incarceration and continue it upon release have significantly lower rates of opioid relapse, criminal recidivism, and overdose death compared to those who receive abstinence-based treatment only (Steadman et al., 2009).

Despite this evidence, access to MAT in jails, prisons, and diversion programs remains limited. Many correctional facilities do not offer MAT, and many mental health courts do not include MAT access as a component of their treatment protocols. The barriers include institutional resistance rooted in abstinence-oriented treatment philosophies, concerns about medication diversion within correctional settings, insufficient medical staffing to prescribe and monitor medications, and the fragmentation of funding streams that makes it difficult to sustain MAT across the transition from jail to community. Expanding MAT access within diversion programs represents one of the most evidence-supported improvements available to the field (Drake et al., 2004).

The integration of MAT into mental health diversion programs requires coordination between prescribing physicians, mental health treatment providers, probation officers, and the courts—coordination that the fragmented American service delivery system does not facilitate naturally. Programs that have achieved this integration report that the combination of psychiatric medication management, MAT for substance use, and court-supervised case management produces outcomes superior to any single intervention alone, suggesting that the highest-risk, highest-need segment of the justice-involved population benefits most from integrated models that address the full complexity of their clinical presentation (Lamberti et al., 2004).

Equity, Ethics, and Reform

Racial Disparities in Diversion Access

Racial disparities in access to mental health diversion programs mirror the broader racial disparities that characterize American criminal justice. Research suggests that Black and Hispanic defendants are less likely to be referred to mental health courts, less likely to be accepted into diversion programs, and more likely to have their mental health needs unrecognized or unaddressed within the justice system. These disparities reflect multiple mechanisms: racial differences in arrest patterns that bring more Black individuals into the justice system for behaviors that might not result in arrest for white individuals, diagnostic biases that lead clinicians to underidentify mental illness in Black patients or to attribute their symptoms to criminality rather than illness, and eligibility criteria that screen out individuals with violent charges or extensive criminal histories—criteria that disproportionately exclude Black defendants (Steadman et al., 2009).

Addressing racial disparities in diversion access requires attention to both the referral processes that determine who enters diversion programs and the structural conditions that determine who encounters the criminal justice system in the first place. Standardized screening at booking, rather than reliance on discretionary referral by attorneys or judges, can reduce the bias introduced by individual decision-makers. Expansion of eligibility criteria to include violent offenses and extensive criminal histories—categories from which Black defendants are disproportionately excluded—can increase the diversity of diversion participants. But upstream interventions—investment in mental health services in communities of color, reduction of police encounters through alternative crisis response, and the elimination of policies that criminalize homelessness, substance use, and other behaviors driven by untreated illness and poverty—are ultimately necessary to reduce the disparate criminal justice exposure that creates the diversion need (Compton et al., 2014).

The ethical tensions in mental health diversion reflect the broader tensions in clinical criminology between therapeutic benefit and coercive control. Diversion programs offer treatment and support that participants may truly need and want, but they do so within a framework of court supervision, compliance monitoring, and graduated sanctions that retains the coercive authority of the criminal justice system. Participants who reject treatment or fail to comply with program requirements face criminal prosecution that they might otherwise have avoided—a dynamic that raises questions about the voluntariness of participation and the appropriateness of using criminal justice authority to compel treatment engagement. The ethical legitimacy of diversion depends on the genuine availability of alternatives, the quality of the treatment provided, and the proportionality of the consequences imposed for non-compliance (Redlich et al., 2006).

Toward System-Level Reform

The limitations of program-level diversion have prompted growing recognition that addressing the criminalization of mental illness requires system-level reform rather than incremental program expansion. The Stepping Up Initiative’s goal of reducing the number of people with mental illness in jails by coordinating efforts across mental health, substance abuse, housing, and criminal justice systems represents one approach to systemic reform. Medicaid expansion under the Affordable Care Act has provided health insurance to millions of previously uninsured individuals with mental illness, potentially improving access to community treatment that prevents criminal justice involvement—though the implementation and impact of Medicaid expansion on justice-involved populations has varied across states (Torrey et al., 2010).

The 988 Suicide and Crisis Lifeline, launched in 2022, represents another system-level reform with implications for mental health diversion. By establishing a national crisis response number analogous to 911, the 988 system creates an alternative entry point for behavioral health crises that bypasses law enforcement entirely, directing callers to crisis counselors, mobile crisis teams, and crisis stabilization centers. The effectiveness of 988 in reducing law enforcement involvement in mental health crises depends on the capacity of the crisis response infrastructure behind the phone number—a capacity that varies enormously across communities and that requires sustained investment to build and maintain (Munetz & Griffin, 2006).

The most fundamental reform would address the root cause of criminalization: the systematic underfunding and fragmentation of public mental health services that has made the criminal justice system the default institutional response to serious mental illness in America. Restoring adequate funding for community mental health centers, expanding access to psychiatric medications and therapy, investing in supportive housing and employment services, and developing integrated service delivery models that coordinate care across mental health, substance abuse, housing, and criminal justice systems would reduce the flow of individuals with mental illness into the justice system more effectively than any number of diversion programs operating downstream of the systemic failure that produces the need for them. The clinical criminology of mental health diversion thus points beyond itself—toward the social policy reforms that would make diversion unnecessary for the majority of the population it currently serves (Lamb & Weinberger, 2005).

Conclusion

Mental health diversion programs represent the American criminal justice system’s most sustained effort to address the crisis of criminalized mental illness that deinstitutionalization and community mental health system failure have produced. From pre-arrest police interventions through mental health courts to post-release forensic case management, diversion programs at every intercept point have demonstrated the capacity to redirect individuals with mental illness from criminal processing to treatment, reducing recidivism, incarceration, and psychiatric hospitalization while improving mental health functioning and quality of life for participants.

The limitations of diversion are equally clear. Programs reach only a fraction of the justice-involved population with mental illness. Their effectiveness depends on community treatment resources whose chronic underfunding created the criminalization crisis in the first place. Racial disparities in access and the coercive dynamics of court-supervised treatment raise equity and ethical concerns that the field has acknowledged but not resolved. And the scale mismatch between program capacity and systemic need means that diversion, however effective at the individual level, cannot address the structural conditions that produce the mass criminalization of mental illness at the population level.

The future of mental health diversion lies in the integration of program-level interventions with system-level reforms that address the root causes of criminalization—adequate funding for community mental health services, expansion of supportive housing, development of crisis response alternatives to law enforcement, and the creation of integrated service delivery systems that coordinate care across the institutional boundaries that currently fragment the response to individuals whose needs span multiple systems. The evidence supports the effectiveness of well-designed diversion programs; the challenge is to build the systemic infrastructure that would make them the exception rather than the rule in the justice system’s response to mental illness.

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