NEW YORK — Rep. Ritchie Torres introduced a bill last week that would lift limits on federal funding available for mental health care institutions, the New York Daily News has learned.

The bill’s introduction comes soon after a series of fatal stabbings that left three people dead in Manhattan.

If passed, the so-called “Repealing the IMD Exclusion Act” would scrap a decades-old law that places strict limits on federal Medicaid funds paying for care at mental health care inpatient facilities for adults.

“It is far more compassionate and far more cost effective to treat those with severe mental illness … in a healthcare setting rather than allow them to languish on the streets and subways, where they are not only a danger to themselves, but to the people around them,” Torres told the Daily News.

The restriction was originally intended to prevent the warehousing of people with severe mental illness in large institutions. It prevents the federal government from footing the bill for mental health institutions serving adults, instead punting the bill to the state. Under the current laws, states are allowed to apply for waivers to the rule. New York has one such waiver.

The city’s mental health crisis has come into sharp focus and reignited a debate over how best to care for those with severe mental illness after suspect Ramon Rivera allegedly fatally stabbed a construction worker in Chelsea, a fisherman near the East River and a woman sitting on a park bench near the United Nations last month.

After the incidents, Torres slammed both Gov. Hochul and Mayor Adams for failures on the state and city level. More inpatient care options are necessary to prevent incidents like the stabbing incident, Torres said.

“Policy at the federal level swung the pendulum too far in the direction of deinstitutionalization. It has been a failure,” Torres said, adding he also wants to see fewer restrictions on involuntary removals and hospitalizations, a policy championed by Mayor Adams, and end early release from detention for those who commit violent crimes.

Repealing the IMD exclusion would free up federal funding for mental health institutions, could alleviate a front-end need for more psych beds. The push to repeal it has typically been a conservative cause, with many advocates pushing instead for more resources allocated to programs aimed at longer-term help.

Glenn Liebman, CEO of the Mental Health Association in New York State, said that while inpatient care can be necessary, discharge policies, community-oriented mental health care and outpatient care options do a better, more lasting job of helping people with severe mental illness.

“If we had a robust community system, if we had a workforce that was well paid, then a lot of these terrible incidents would not have happened,” Liebman said.

“There are always going to be people fall through the cracks, and that’s why we have to have some remedies around some sort of hospitalization for them… But the vast majority of people with mental health issues can be served very well in the community, and frankly, we have a vastly underfunded community based mental health system.”

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