This column describes an innovative, government-sponsored, countrywide mental health reform focusing on rehabilitation and community integration of persons with serious mental illness, which was enacted into law in Israel in 2000. The reform was part of the country's efforts to shift the locus of treatment and care from psychiatric institutions to the community. The authors review preliminary evidence of the impact of reform and offer cautionary notes regarding the future direction of its implementation. The decade after the law's enactment saw an impressive increase in rehabilitation services, a significant reduction in the number of psychiatric beds, and major changes in government budget allocations. The authors examine factors that may endanger the viability of reform and discuss lessons to be learned from the Israeli experience.

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The crisis in community care for the seriously mentally ill (SMI) stems from organizational and financial difficulties as well as from deeply embedded structural factors. The analysis shows a preference for medicalizing and individualizing the problems of SMI rather than viewing them as structural social welfare issues. The author discusses problems of deinstitutionalization, homelessness, service provisions, financing, accounting and reporting, employment, bureaucratic skimming and burden to families and points out the ambivalent ideology and the inherent contradictions within the mental health service system. Finally, the centrality of social control and the maintenance of orderly social life in public policy and program development is illuminated.

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