Skip to main content

Mental Healthcare in North Carolina: Disparity, Reform, and Challenges

By Eleanor Christianson, Selena Kleber, Alex Tanas, and Kartik Tyagi


This playlist tells a story of mental health disparities that exist in North Carolina in the past and present. Donald Williams asks for more affordable healthcare. Donald Smith speaks about his personal experiences at Dorothea Dix Hospital and Donna Smith explains her role as a mother navigating the system. Esteen Allen describes her experiences with mental health patients and families. Jim Kellenberger shares his personal view of the broken mental health system, including the homeless and the loss of his mother. Manuel Versola talks about how medications and treatment have changed and the difficulties of mental health facilities. Pettis Montague explains why there is a need for these facilities and what closures mean. These stories do not end with these six individuals. There are many more like them. Our objective is to share their stories and paint a picture focusing on: mental health policy/reform, hospital & logistical challenges, impacts on patients, and solutions moving forward to address mental health disparities.


In looking at the modern healthcare system in the state of North Carolina, it is clear disparity exists. After all, some might say that disparity is inevitable. However, in examining the mental healthcare system in the state, it is also clear that the history of mental health reform and policy in North Carolina has impacted the delivery of appropriate mental healthcare, insurance equity, provider relations, and in ensuring healthcare access. Dorothea Dix Hospital, the “now-shuttered” psychiatric facility in Raleigh, has a rich history of over 150 years; established in March 1849, the hospital served as a facility for the mentally ill, consistently marked by shortages in space, funding, and resources, with more than 2,700 patients by the year 1974 (Goldsmith). Eventually, as a result of the U.S. Supreme Court’s Olmstead decision, which mandated lesser-restrictive patient environments, deinstitutionalization ensued and eventually the hospital closed in 2012.

It is because of instances such as those of Dorothea Dix Hospital that bring into the limelight the long history of mental healthcare in North Carolina. Dr. Vijay Ghate, a former staff physician in the admissions ward at Dorothea Dix, says in his interview with the Southern Oral History Program that, in looking at how mental healthcare has shifted over the years statewide, management failed as a result of the radical change that happened when judges made the decision that “state hospitals are not providing the care for the mentally ill, so deinstitutionalization should be the goal.” He says that in making this decision, the judiciary acted “without thinking about the consequences,” which resulted in chaos (Ghate). As a result, it is imperative to analyze the impacts of North Carolina’s history of mental health policy and reform, address the challenges pertaining to mental health resources in healthcare systems, consider the impacts of disparity on the statewide patient community, and discuss solutions moving forward to address those very disparities in mental healthcare.

In regards to the impacts of North Carolina’s history of mental health policy and reform, it is evident that, when speaking about the state’s mental health system, “where we have been, where we are, and where we are headed” may not be as simple as it seems, according to Mebane Rash, CEO and Editor-in-Chief of EducationNC. With the passing of the aforementioned Olmstead decision by the U.S. Supreme Court in 1999, mental health reform became widespread across the country. In the state of North Carolina, this took the form of the 2001 Mental Health Reform Act, which enabled limited management entities (LMEs), government entities, to serve clients directly as opposed to expecting them to “manage the state-funded insurance payments for the providers in their network” (Coates). This reform served as the basis for the current struggles faced by North Carolina’s mental healthcare system.

Since 2001, North Carolina has condensed its thirty-nine area mental health authorities to twenty-three local mental health management entities. Now, there remain only eleven managed care organizations (Rash). Furthermore, funding for mental health in the state has seen tremendous spikes as well as drops in the past decade. This fact, when combined with constant shifts in leadership within the state health services staff and legislative priorities, “further complicates” mental healthcare in North Carolina, and altogether “compromises the stability of the system” (Rash). In handling these concerns going into the future, a legislative agenda with mental health priorities must be evaluated; “more legislative solutions are necessary to support providers” (Duong). Additionally, the ongoing issues of patients in need ending up “in the criminal justice system instead of the mental health system” as well as serving patient communities closer to home and in their communities, which is “less expensive than the alternatives,” must be addressed (Rash). Moving forward, addressing these ongoing issues must begin in addressing the challenges pertaining to mental health resources in healthcare systems as a result of the past, present, and future of mental health policy and reform in North Carolina.

North Carolina’s mental healthcare policy has drastically underestimated the need for increased infrastructure and support for mental health care systems. Due to this failure, shortages in treatment availability, fractured mental healthcare systems, and privatized treatment have become obstacles for legislators and healthcare providers aiming to improve mental healthcare. In North Carolina, in particular, these challenges were exacerbated in the closing of Dorthea Dix. Since deinstitutionalization, all of the psychiatric patients have been funneled into the existing hospital systems. With less space designated specifically for people with mental illnesses, people seeking help are sent to emergency rooms that are already at capacity. State psychiatric beds have been reduced by ninety percent (Copeland). To make matters worse, only eight psychiatrists are available for every one hundred thousand North Carolinians, which is forty-two psychiatrists less than recommended (Copeland). At the same time, the amount of patients seeking treatment for mental illnesses has greatly increased since Dorthea Dix’s doors were closed; today, one in five adults and one in ten children have mental illnesses in North Carolina (Doung). Many people feel helpless in this situation because the very policies designed to reform mental healthcare are making it so much harder to get the help that people deserve. In an interview with the Southern Oral History Program, Jim Kellenberger, a family member of a former patient at Dorothea Dix Hospital, put it simply: “The mental healthcare system is broken” (Kellenberger).   This truth is felt by every North Carolinian and, sadly, is a hardship to overcome especially with current mental health care policy.

The misjudgment of hospital bed and treatment availability is compounded by the immense failure by legislators to designate resources for long term support for those suffering from mental illnesses. Mental healthcare has been reduced to either short stays in emergency rooms that are not set up for long term health plans, or privatized mental healthcare treatment centers that cater to the top section of North Carolina’s socioeconomic ladder. Without proper infrastructure and support through the few outpatient programs that exist, many of North Carolina’s residents are left with inadequate resources and housing. Pettis Montague grew up around Dorthea Dix and is quite cognizant of the effects of deinstitutionalization. In an interview with the Southern Oral History Program, she states, “ I see people on the streets, living on the street now, and I’m thinking, ‘You probably would have been at Dix’” (Montague). To her, deinstitutionalization caused more problems than good; she saw the good that Dorthea Dix could do and recognized that deinstitutionalization prohibited people from getting the care that they could have had without the policy change. While legislators had hoped that deinstitutionalization would save money and raise the quality of care, they failed to extend resources to the state hospitals that would take on the inflow of patients from mental institutions. Legislators drastically reduced funding, limiting patients to short emergency room visits. This is not a solution, but a bandaid on a growing wound in the healthcare system. The grim reality is that the policies have neglected vulnerable populations in North Carolina which has further worsened the inequality.

Disparities in mental health care severely affect patients seeking treatment in North Carolina and, as a result, frustrations over access to mental health services arise including insurance problems, the mentality of a crisis-driven system, and geographic barriers. Mental healthcare institutions in North Carolina were once racially segregated. Since integration, there have been immense advances, but there are many challenges that still exist for North Carolinians that are mentally ill and lack insurance. Private hospital groups have community extensions and outpatient arrangements for mental and behavioral health care services within their provider network, but those are rarely accessed because people cannot afford them. Donald Smith, a former patient at Dorothea Dix, explained in an interview with the Southern Oral History Program that in his area there are no psychiatrists who take Medicare. Smith had to go to UNC’s STEP (Schizophrenia Treatment and Evaluation Program) Clinic because he could not afford to pay for a doctor beyond what Medicare would cover. Donald Williams, farmer and resident in North Carolina said, “the whole healthcare system is too expensive for most people. If they can’t afford insurance, they’re in bad shape.” (Williams) The financial aspect of healthcare, specifically mental health care, has been a burden for people for years and still remains a problem today, as evident by Williams.

Another one of the critiques from the patient community is that the mental health system feels like a revolving door. In Donna Smith’s, mother of Donald Smith, own words she says, “I think our system is a crisis-driven system. It forces people into crisis in order to get services and support, and as soon as they’re out of crisis, they lose those. The whole function is to control and contain.” (Smith) The idea that after discharge there is a lack of assistance in terms of support and services is discouraging for family members, like Donna Smith. Patients get frustrated by the absence of effective mental health treatment because there is no continuity or relationship with their provider.

Not only is the system based on being reactive versus proactive, but there is also a lack of mental institutions that remain open, which poses a geographic barrier to getting mental health services. After being asked about Dorothea Dix and its closure, Pettis Montague, having grown up on “the Hill” at the hospital, said, “Yeah, it was sad because as an adult, I’ve learned what a tremendous need there is for people who have mental handicaps, mental disease, people who can’t function in society without assistance …So without that, I see people on the streets, living on the street now.” (Montague) Montague has a unique first-hand perspective having lived at Dorothea Dix. She is referring to the importance of having mental health facilities and that the loss of these facilities may lead to an increase in homelessness. Donna Smith, also said in her SSL interview, “It’s just so frustrating to have somebody in your life who is actively ill and never be able to do anything about it. I’m still really angry about it [Dorothea Dix closure in 2012]”. Smith is expressing both her concerns and frustration. In addition to Dorothea Dix, the Eastern NC mental health unit is also slated for closure. It is obvious that these closures make it increasingly difficult for residents to access, much less receive, inpatient mental health services. North Carolina communities, especially the rural areas, are affected the most by these problems of affordability, continuity, and access. The reality is that there are thousands of people in North Carolina that need psychiatric help but are unable to.

In recognizing these issues, the state of North Carolina has undergone legislative and non-legislative actions to combat the issue of mental health disparity statewide. In the Southern Oral History interview, Dr. Manuel Versola, a psychiatrist in Smithfield, North Carolina, explains that behavioral crisis patients “have to go through procedures [to get] all necessary tests” and to work with social workers and psychiatrists in the field (Versola). This is supported in conjunction with the It was the first action towards involuntary commitment since the Mental Health, Developmental Disabilities, and Substance Abuse Act of 1985. This law had set in new expectations for behavioral crisis patients: it required primary screenings to eliminate possibilities of psychiatric conditions, expanded the workforce for first examinations to include more nurse practitioners, licensed professional counselors, and physician assistants, and, lastly, promoted the creation of community crisis plans by healthcare providers across the state to get patients to the most appropriate healthcare location. Financially, to combat mental health disparities, the state created a new funding model with federal Medicaid waivers in which the state would pay a set amount of money each month for all consumers provided medical treatment. One non-legislative example from the North Carolina Institute of Medicine (NCIOM) included the NCIOM task force which expanded community-based “prevention, treatment, and recovery services” for individuals with mental health disorders (NCMJ 2020). These laws and programs serve as a foundation for the future of improving overall mental healthcare in the state of North Carolina.

Moving forward, however, mental health disparities can be minimized with stronger enforcement of the federal Mental Health Parity and Addiction Equity Act of 2008. One of the main reasons North Carolina struggles immensely in terms of their mental health treatment programs is because this law has not been efficiently enforced on the statewide level. This can be done by providing more access to mental health resources in North Carolina as well as cutting down and penalizing insurance plans that do not fully commit to the 2008 law. There are still many challenges facing the adequate implementation of legislative and non-legislative measures, but, overall, the future of mental healthcare in North Carolina is a working progress, one that healthcare providers, lawmakers, and community-based social workers are working together to improve upon.

In the past, North Carolina’s legislators have written policies that failed to account for adequate resources in hospital systems, further increasing mental healthcare disparities and creating new challenges for legislators today. Like many states in the United States, mental healthcare is a complex issue that affects every person in some way. The Southern Oral History Program brings these struggles to life by interviewing the very people that have experienced hardship in the mental healthcare system. Interviews like these can make a monumental impact on how legislators and healthcare professions see their work. Through this, hopefully, they become inspired and driven to amend the wrongs in place and help people get the treatment and resources they need for a better life.


Coates, Jessica, et al. “Navigating the Cyclone: 21st Century NC Mental Health Policy.” Carolina Public Press, 24 Feb. 2018,

Copeland, John Nathan.  “NC Mental Health System Needs Rebuilding.” The News & Observer, 20 March 2017, Accessed 25 March 2020.

Duong, Yen, and North Carolina Health News. “Mental Health Providers Struggle with Disparities in the System.” North Carolina Health News, 13 Feb. 2019,

Duong, Yen. “North Carolina Gets an ‘F’ on How Equally It Treats Mental and Physical Health Issues.” North Carolina Health  News, 15 January 2019, Accessed 25 March 2020.

Ghate, Vijay. Interview with Caroline Efird. 1 February 2019 (Y-0061). Southern Oral History Program Collection (#4007), Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill.

Goldsmith, Thomas, and North Carolina Health News. “Dorothea Dix Hospital – Interactive History Timeline.” North Carolina Health News, 11 Oct. 2016,

Henry, Julie. “NC General Assembly Passes Major Update to Mental Health Law.” NCHA, NCHA, 14 June 2018,

Kellenberger, James. Interview by Caroline Efird. 4 January 2019 (Y-0063) Southern Oral History Program Collection (#4007), Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill

Montague, Pettis. Interview by Caroline Efird. 21 March 2019 (Y-0064). Southern Oral History Program Collection (#4007), Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill.

NCIOM Task Force.  “Issue Brief: Transforming North Carolina’s Mental Health and Substance Use Systems.” North  Carolina Medical Journal, vol. 77, no. 6, pg. 437-440, 18 November 2016, Accessed 25 March  2020.

Rash, Mebane. “North Carolina’s Mental Health System: Where We Have Been, Where We Are, and Where We Are Headed.” N.C. Center for Public Policy Research, North Carolina Insight, Dec. 2012,

Smith, Donna. Interview by Caroline Efird, 3 February 2019 (Y-0065) Southern Oral History Program Collection (#4007), Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill

Versola, Manuel. Interview by Caroline Efird, 3 February 2019 (Y-0067) Southern Oral History Program Collection (#4007), Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill

Williams, Donald. Interview by Caroline Efird, 28 June 2018 (Y-0059) Southern Oral History Program Collection (#4007), Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill