The “Reagan defunded psychiatric hospitals” trope needs to die. The wards started emptying in the 60s with the granting or rights to the patients. We don’t want to go back to “one flew over the cuckoo’s nest”. Then more with the invention of meds that controlled the worst symptoms. Psychiatric hospitalization rates dropped 65% from 1970-1979. Those hospitals were funded by states not the feds, so there was a much larger trend going on.
The bill had been only law for 10 months when Reagan repealed it. It seems dubious that either the bill or its repeal had any significant impact on the national trend which, as the gp pointed out, was well on its way by 1980.
[1] https://www.nasmhpd.org/sites/default/files/TACPaper.2.Psych...