Michael D. Rosberg, Ph.D.
Introduction
Treatment-resistant schizophrenia (TRS) represents a disproportionate driver of healthcare and social costs in the United States. The ASC Treatment Group’s human-centered redesign model integrates evidence-based environmental design and creative therapies, including horticulture, art, animal care, and restorative architecture, to promote safety, autonomy, and adherence. These interventions are intended to reduce behavioral crises, hospitalizations, and medication reliance.
Estimated annual savings range from $60,000 to $100,000 per patient. For a 20-patient program, this equates to approximately $2 million in projected yearly savings, before counting broader benefits across healthcare, forensic, and housing systems.
The model reframes environmental redesign as a core clinical intervention rather than an aesthetic enhancement. Residential treatment centers built around this principle have the potential to reduce costs across the system while supporting recovery, lowering homelessness, and strengthening California’s behavioral health continuum of care.
Overview
Treatment-resistant schizophrenia (TRS) is one of the most expensive and destabilizing conditions in modern behavioral healthcare. Approximately one-third of individuals with schizophrenia do not achieve adequate symptom control with standard antipsychotic therapy, and healthcare costs for this subgroup are estimated to be three to eleven times higher than for treatment-responsive schizophrenia, driven largely by recurrent hospitalizations and social services contact (Kennedy et al., 2014). In 2019, the total economic burden of schizophrenia in the United States reached $343.2 billion, including direct healthcare costs, indirect costs related to unemployment and productivity loss, and nonhealthcare costs such as incarceration and homelessness (Kadakia et al., 2022). TRS patients account for a disproportionate share of this burden, driven primarily by longer and more frequent inpatient stays than those typical of schizophrenia overall (Kennedy et al., 2014).
Environmental Redesign and Cost Efficiency
Much of this cost burden is not inevitable but iatrogenic, resulting from systems built around containment rather than recovery. Re-engineering environments to promote safety, autonomy, and engagement produces measurable economic and clinical benefits. Human-centered design interventions, including access to natural light, therapeutic gardens, flexible social spaces, and animal-assisted and horticultural programs, have been associated with improved adherence, reduced agitation, and a stronger therapeutic alliance.
A systematic review of the built environment as a therapeutic intervention in mental health facilities found that design elements such as access to nature, sensory balance, and spaces that promote social interaction are consistently linked to improved patient outcomes and reduced behavioral tension (Rodríguez-Labajos et al., 2024). These environmental therapies directly decrease high-acuity episodes and staff intervention frequency, thereby lowering total system costs.
Adherence is itself shaped by environment. Mote and Fulford (2020) found in a systematic review of ecological momentary assessment studies that social motivation in schizophrenia fluctuates with environmental context, with both under-stimulating and chaotic settings reducing participation in care. Green et al. (2018) similarly argue that while social cognitive deficits are intrinsic to schizophrenia, the disconnection that follows is shaped by environment, which is where intervention becomes possible.
ASC has observed clinical correlates of this principle in its own residential programs. Following environmental redesign that introduced therapeutic gardens, animal-assisted interventions, designated quiet zones, and communal art spaces, two TRS residential programs showed a 54% reduction in staff interventions and a 32% drop in PRN medication use over 18 months, along with improvements in resident-reported comfort and willingness to participate in group activities (Rosberg et al., 2023). These clinical changes translate directly into the cost parameters discussed below.
Economic Scenarios Illustrating Cost Advantages
To illustrate the fiscal advantages of providing desirable, human-centered treatment options, two scenarios are presented below. These are illustrative models grounded in published cost estimates and ASC’s observed clinical outcomes; actual savings will vary by case mix, payer structure, and regional rates.
Scenario 1: Enhanced Residential Model vs. Conventional Institutional Care
A patient with TRS in a conventional, minimally therapeutic institutional setting may require multiple acute hospitalizations annually. At typical acute psychiatric inpatient rates of approximately $2,000 to $2,300 per day, direct hospitalization costs alone can approach $200,000 annually for patients with extended and repeated stays. In contrast, a patient in a redesigned, human-centered residential treatment environment that integrates creative therapies (horticulture, art, music, animal care) can be expected to show substantial reductions in acute hospital days and PRN medication use, consistent with the clinical patterns observed in ASC’s redesigned programs (Rosberg et al., 2023). A projected 50% reduction in acute hospital days and a 30% reduction in PRN medication use translates to an estimated annual cost savings of approximately $100,000 per patient. Across a 20-patient program, this model yields an estimated $2 million in annual direct-care savings, before downstream benefits such as reduced emergency utilization and improved staff retention.
Scenario 2: Continuity of Care vs. Discontinuous and Undesirable Services
A patient discharged from a clean and orderly psychiatric institution to an under-resourced, chaotic community setting often experiences deterioration within weeks, resulting in re-hospitalization or forensic involvement. Each cycle of decompensation can cost approximately $50,000 to $80,000 in emergency, inpatient, and legal services. By contrast, transitioning patients into stable and therapeutically engaging community programs is projected to reduce relapse rates and eliminate many of these cyclical costs, with estimated savings of approximately $60,000 per person per year.
This contrast underscores a clinical reality. Moving a patient from a psychiatric institution that is at least neat, orderly, and clean into a community-based setting defined by disruption and poverty is contrary to the mission of treatment and rehabilitation. Environments that are unsafe, unattractive, or impoverished work against recovery and can undo years of progress achieved in care.
Downstream and Systemic Savings
Improved environmental and engagement models produce downstream savings across systems:
• Healthcare and emergency services. Fewer psychiatric readmissions, emergency visits, and medical complications free up hospital capacity and reduce operating costs.
• Forensic and legal systems. Reduced behavioral incidents and stabilization of high-risk individuals decrease incarceration rates and legal expenditures.
• Housing and community impact. Enhanced residential stability diminishes chronic homelessness and reduces reliance on emergency shelter and street-based outreach services.
• Family and workforce participation. Improved functioning allows family caregivers to return to employment, reducing lost productivity and secondary economic strain.
Conclusion
When TRS patients are treated through integrated pharmacologic, psychosocial, and environmental approaches, reductions in symptom burden and service utilization are measurable and sustained. Environmental redesign is both clinically appropriate and fiscally rational. Human-centered environments improve lives and reduce the cost of poorly treated schizophrenia on healthcare, justice, and community systems.
Investment in environmental redesign and adherence-focused treatment offers grantors and public agencies one of the more direct paths to lasting improvements in recovery outcomes, with corresponding reductions in the long-term costs associated with treatment-resistant schizophrenia.
References
Green, M. F., Horan, W. P., Lee, J., McCleery, A., Reddy, L. F., & Wynn, J. K. (2018). Social disconnection in schizophrenia and the general community. Schizophrenia Bulletin, 44(2), 242–249. https://doi.org/10.1093/schbul/sbx082
Kadakia, A., Catillon, M., Fan, Q., Williams, G. R., Marden, J. R., Anderson, A., Kirson, N., & Dembek, C. (2022). The economic burden of schizophrenia in the United States. The Journal of Clinical Psychiatry, 83(6), 22m14458. https://doi.org/10.4088/JCP.22m14458
Kennedy, J. L., Altar, C. A., Taylor, D. L., Degtiar, I., & Hornberger, J. C. (2014). The social and economic burden of treatment-resistant schizophrenia: A systematic literature review. International Clinical Psychopharmacology, 29(2), 63–76. https://doi.org/10.1097/YIC.0b013e32836508e6
Mote, J., & Fulford, D. (2020). Ecological momentary assessment of everyday social experiences of people with schizophrenia: A systematic review. Schizophrenia Research, 216, 56–68. https://doi.org/10.1016/j.schres.2019.10.021
Rodríguez-Labajos, L., Kinloch, J., Grant, S., & O’Brien, G. (2024). The role of the built environment as a therapeutic intervention in mental health facilities: A systematic literature review. HERD: Health Environments Research & Design Journal, 17(2), 281–308. https://doi.org/10.1177/19375867231219031
Rosberg, H., Alcantar, J., Rosberg, M. D., & Flowers, C. (2023, October 12–14). Enhanced residential settings as an augmentation of clozapine pharmacotherapy for treatment-refractory schizophrenia patients [Poster presentation]. American Psychiatric Association Mental Health Services Conference, Washington, DC, United States.