I’m not sure how to take your post, but it seems certainly possible for state mental institutions to become highly wasteful. Everything becomes a “disease” that needs treatment - for a price. The prison system is partially transferred to mental health.
When Ronald Reagan was Governor of California, I believe he shut down state mental institutions for precisely this reason.
The issue I was discussing was medical experimentation on humans without their consent.
Much of it was funded by the CIA, the Rockefeller Foundation etc.
They believed they could manipulate humans like robots if they did not analysis on how the brain worked.
The “scientists” were not happy with tests on mice or dogs or chimps—they insisted on going “all the way” with humans.
While MKUltra is the best known example there were dozens of mental hospitals used as “fronts” for the American versions of Joseph Mengele.
The “follow the science” crowd do not like to talk about this history.