Diagnosed and Denied
The repercussions of getting help.
By a healthcare provider who’s watched too many patients get penalized for doing the right thing: getting help.
You finally convince someone to see a therapist. Maybe it’s a patient. Maybe it’s a friend. Maybe it’s you. After months, even years, of battling the invisible, they get a name for it. Something to hold onto. “Generalized Anxiety Disorder.” “Bipolar II.” “PTSD.”
Relief.
And then: they apply for life insurance. Or get called into court. Or mention it at work. And suddenly, that diagnosis—-the one meant to unlock healing—-becomes a red flag flapping behind them like a caution tape cape.
As a healthcare provider, I’ve seen it more times than I can count: people punished for seeking care. Because when it comes to mental health, our systems don’t just ask “How are you doing now?” rather, they ask “Have you ever been... not okay?”
A Label is Supposed to Help. Instead, It Can Haunt.
Let’s set the record straight: mental health diagnoses are not moral failures. They’re tools. Guideposts. Starting points for treatment.
But in the real world, they can become lifelong liabilities.
Research shows that psychiatric labels can permanently alter how others perceive you, regardless of your actual behavior or stability. This phenomenon, known as diagnostic overshadowing, means people tend to interpret all your future actions through the lens of that diagnosis, even when it’s irrelevant or outdated.
A 2024 study found that individuals labeled with schizophrenia or borderline personality disorder were perceived as more dangerous and less capable, even by trained professionals.
Once labeled, always labeled. Even if you're thriving.
Life Insurance: “Thanks for Being Proactive, That’ll Bump-Up Your Premium”
Life insurance companies have zero chill when it comes to mental health history. If you’ve ever been diagnosed with depression, bipolar disorder, anxiety, PTSD, or, frankly, if you’ve just seen a therapist more than twice—-your application is now under the microscope.
According to the National Alliance on Mental Illness (NAMI), applicants with psychiatric histories often face:
Higher premiums
Lengthy delays
Denials with little explanation
There are no federal laws that prevent life insurers from using your mental health history in underwriting. Multiple case reviews have demonstrated that applicants with a past suicide attempt or psychiatric hospitalization were more than twice as likely to be denied coverage.
Reiterating that very important point: these are people who got help and stabilized and then were financially punished for it.
Court Systems: The "Crazy" Card is Still in the Deck
Let’s talk family court. You’ve got a stable parent, in therapy, taking meds responsibly. But their ex brings up a diagnosis from five years ago.
That label can still sway custody decisions.
A 2023 review in the Journal of Child and Family Studies found that psychiatric diagnoses are routinely used against parents in custody disputes—even when there is no evidence of impaired parenting.
Mental illness in this context is often framed not as a treatable condition, but as a permanent character flaw. Courts rarely distinguish between someone in the throes of a crisis and someone in long-term remission. The diagnosis alone becomes “evidence.”
As a clinician, I’ve watched patients go silent about their mental health because they were terrified it would lose them their kids. Can you blame them?
Legal System: Are You Less Credible Because You Had a Panic Attack in 2016?
Even outside of family court, psychiatric diagnoses can color credibility in criminal or civil proceedings. While some defendants benefit from mental health diversion programs, others are seen as:
Less trustworthy
More impulsive
Unstable witnesses
A 2015 Paper in the International Journal of Law and Psychiatry found that jurors associate mental illness with dangerousness and unpredictability, even when the facts don’t support those assumptions.
In other words: your diagnosis may speak louder than your testimony.
So, What’s the Solution? Burn the DSM?
Not quite. But we need serious change.
1. Policy Reform
We need to extend mental health parity to life insurance and family court. Because if we say mental health is healthcare, we need to treat it like it matters.
2. Privacy Protections
Many people don’t know they can request a copy of their MIB (Medical Information Bureau) file, which insurers use to track health histories. You can review and dispute it. Yes, this exists. Yes, it sounds like dystopian credit scoring for your brain.
3. Nuanced Narratives
Let’s retire the idea that mental illness = instability. Show me a parent with PTSD who’s done trauma work, and I’ll show you one of the most emotionally aware people on the planet.
4. Change in Practice
As providers, we need to diagnose responsibly and educate patients on how that diagnosis might show up later. Empower them with the full picture, not just the treatment plan.
Final Thought: Labels Are for Soup Cans
We tell patients “You’re not your diagnosis.” But until systems catch up, sometimes they are. And that disconnect can be dangerous.
Because in a society that still penalizes people for seeking help, the bravest thing a person can do might also be the most risky.
Let’s fix that.