Mental Health Diagnosis: Harmful or Helpful?

“I’m just too much, right?” she asked, half-joking, her eyes scanning mine for reassurance.

She was 24—articulate, passionate, and deeply intuitive—but overwhelmed by emotions she couldn’t control. Relationships felt like a rollercoaster; even small signs of distance could trigger overwhelming fear of abandonment. When she felt someone pulling away, she sometimes turned that pain inward, resorting to self-harm to cope with the emotional chaos. 

The signs pointed to borderline personality disorder. I knew the diagnosis could be a key to understanding her patterns, a path toward real tools and support. But I also paused. Would she feel labeled as broken? Would others reduce her to a stereotype? Would she start to believe that her need for connection made her unstable or unworthy of love? A formal mental health diagnosis might give her answers or make her question everything.

But then there are moments when the diagnosis is exactly what someone has been waiting for.

The responsibility of clinical mental health diagnosis

Conversations around mental health are more open than ever, but with that progress comes complexity, like navigating the nuances of clinical diagnosis. For many, receiving a diagnosis provides clarity, direction, and access to treatment. It can validate a person’s experience and open doors to healing. But its diagnosis is not always simple, and it doesn’t come without consequences.

One of my clients, a 15-year-old boy, was shocked by his diagnosis.“Wait… there’s actually a name for this?” he asked, sitting back in his chair with wide eyes. He was bright, funny, and constantly brimming with ideas, but always losing his backpack, zoning out in class, and feeling like he was letting everyone down. He’d grown used to being called lazy or careless. But as I described the symptoms of Attention Deficit Hyperactivity Disorder (ADHD), something clicked for him. For the first time, his struggles made sense. “I really thought I was just bad at being a person,” he admitted quietly.

For people like these clients, clinical diagnosis can be life-changing. It can provide clarity, a shared language, and access to meaningful support. For many, it’s the first step toward healing. Receiving a diagnosis can be a reminder that a person is not broken and that they are not alone. But diagnosis also carries risk, particularly when it’s incorrect. Stahnke (2021) highlights that Obsessive Compulsive Disorder (OCD) is frequently misdiagnosed. 

This condition is not only misdiagnosed by the general public but also by healthcare providers and mental health professionals. These errors can lead to significant consequences, including delayed or inappropriate treatment. In fact, misdiagnosis of OCD has been linked to increased rates of depression, psychosis, and suicidality, showing just how critical accurate diagnosis and treatment truly are.
 

The clinical diagnostic process

To form a mental health diagnosis, clinicians rely on clinical interviews, client self-reports, standardized assessments, observation, and clinical judgment, all within the framework of the DSM-5. There’s no lab test that confirms anxiety. No scan that guarantees depression. That means context matters. A person’s cultural background, trauma history, current stressors, and even insurance requirements can all shape what gets written down.

A diagnosis can unlock therapy, medication, school accommodations, or disability benefits. However, it can also alter how someone perceives themselves. For some, that shift feels empowering: “Now I understand why I feel this way.” For others, it’s limiting: “I’ll always be the person with anxiety.”Whether you’re navigating your own mental health journey or supporting someone else, understanding the weight and role of diagnosis is essential.

The powerful relief of a mental health diagnosis

For many, finally receiving a mental health diagnosis is like a heavy weight lifting off their shoulders. It gives voice to what they’ve been struggling with silently and offers validation that they are not “broken” or alone. That simple act of naming a condition can transform confusion into clarity and isolation into connection. It can also offer relief by creating a clear path forward, opening the door to evidence-based treatment options, support groups, and community resources. For mental health professionals, diagnosis serves as a framework for assessing symptoms, tracking progress, and communicating effectively with other providers (DSM-5-TR, 2022).

At my practice, I often hear clients share that receiving a diagnosis brings a profound sense of relief, helping them understand why they were often blamed or misunderstood by loved ones and providing a clear, hopeful direction for healing. For some, like those who have lived with undiagnosed ADHD, this relief comes after years of criticism (i.e, being told they’re lazy, careless, or simply not trying hard enough). 

They’ve struggled with attention and organization their entire lives, but were dismissed or misunderstood, left without the tools or support they truly needed. Others, such as clients coping with depression, may have been told to just “shake it off” or “snap out of it,” minimizing their pain and deepening their isolation. For these individuals, a mental health diagnosis finally confirms that their struggles are real and treatable medical conditions, not personal weaknesses or flaws.

It also allows clinicians to tailor interventions to specific needs and, when applicable, ensure that clients receive necessary accommodations or insurance coverage. In short, a mental health diagnosis can provide structure and direction for the healing process. A formal diagnosis is essential for insurance companies to acknowledge the clinical need for treatment, allowing them to approve necessary medications and specialized therapies.
 

The harmful side of mental health diagnosis

You may be thinking, if a mental health diagnosis can bring clinical direction and relief to clients who are suffering, what could the harmful side effects be? According to Ecker and Fay (2024), diagnostic labels can carry unintended consequences, such as stigma, shame, and self-limiting beliefs, that affect how clients view themselves and their capabilities. Some individuals begin to see their identity solely through the lens of a diagnosis, leading to learned helplessness or a reduced sense of agency.

In my practice, I have noticed an additional challenge for younger Millennials and Gen Z, who are frequently exposed to mental health content on platforms like TikTok. While some of this content can increase awareness, much of it is inaccurate or overly simplified. Creators may unintentionally misrepresent conditions like ADHD, bipolar disorder (BD), or generalized anxiety disorder (GAD), spreading misinformation about symptoms that don’t align with diagnostic criteria. 

As a result, many young people may be self-diagnosing based on trending videos rather than seeking qualified support, which can lead to confusion, mislabeling, or delayed treatment. Without clinical context and care, a mental health diagnosis can shift from being a tool for healing to a barrier to growth.

Therapy and insurance: A complicated relationship

One of the earliest and most eye-opening lessons I’ve learned as a therapist is that graduate school doesn’t fully prepare you for the complex, often frustrating world of insurance. Many clients are surprised to learn that insurance companies require a formal mental health diagnosis to approve and reimburse for services. This policy can place pressure on clinicians to assign a diagnosis—even when someone is seeking therapy for personal growth, life transitions, or simply needing someone to talk to (Clark, n.d.). 

Yes, you're reading that right: even if you’re not experiencing a clinical disorder, you may still need to be labeled with one for insurance to cover your sessions.

Another common misconception around therapy and insurance concerns confidentiality. While therapists do everything they can to protect client privacy, therapy information may not remain fully confidential when insurance is involved. Records submitted for claims can be reviewed or audited, and in some cases, having a documented mental health diagnosis can impact future applications for life insurance or certain medical policies (North American Company for Life and Health Insurance, 2025).
 

Pro tips for navigating a mental health diagnosis and therapy

This is the advice I give friends and family: if you want to avoid feeling defined by a diagnostic label, consider seeking out therapists who use a person-centered or strengths-based approach.

These therapists focus on understanding your unique experiences, values, and strengths rather than rushing to assign a label. For those who prioritize privacy and autonomy in their mental health care, working with a therapist who does not bill insurance can offer greater confidentiality and more personalized treatment without external limitations.

If you find yourself struggling with the weight of diagnostic labels, try these empowering mantras: 

“A label does not define my worth or limit my growth.” 

“I can acknowledge my struggles without letting them shape my identity.” 

“I trust my journey, even when it looks different from others.” 

“I can honor what I’ve been through without being defined by it.”