ALTHOUGH MANY PEOPLE with serious mental illnesses have moved successfully from hospitals to the community, thousands have not. By the early 1990s, it was estimated that more than 200,000 mentally ill people lived on the street. Experts guess that between 25 and 33 percent of the homeless have a severe mental illness, while another third may have alcohol and drug problems. Some of these people arouse pity and concern. They may appear confused, panicky, sad, or unable to meet their own needs. Others have made news headlines by assaulting and harassing neighbors.

The homeless mentally ill

In a column called "Sick and Cheated," journalist Bob Herbert wrote:

For years we have been told that the massive discharge of patients from mental institutions would not be harmful because the patients would receive the services they needed from facilities in the community. This has been...