By the early 1960s, Mike Gorman was on a first-name basis with two-thirds of the U.S. Congress, as well as many state governors and mental health professionals. In 1961, on President Kennedy's recommendation, Gorman had been appointed to the twelve-member National Advisory Mental Health Council, which gave final approval to all grants awarded by the National Institute of Mental Health. President Lyndon Johnson, like Kennedy, was a Gorman friend and ally. As a result, Great Society federal programs such as Medicare included some mental health coverage, and Johnson also supported a 1965 amendment to the Community Mental Health Centers Construction Act that provided additional funding for personnel. During these years, Gorman broadened his crusade, and pushed for more services for emotionally disturbed children, and for those suffering from alcoholism or drug abuse.

And yet the reforms enacted never fulfilled the crusaders' hopeful vision. Shortcomings of the community mental health centers movement surfaced as the system evolved. The centers continued to suffer from personnel shortages; weak inter-governmental linkages often complicated or left gaps in patient care at various levels; two-thirds of chronic, severe cases were cared for in the psychiatric wards of general hospitals, rather than in outpatient community mental health centers. More importantly, comprehensive after-care programs almost never developed. Halfway houses were established in some places, but these never became a significant component of available care, in part because they were not covered under federal or state mental health benefits. No single organization ever assumed long-term responsibility for the severe, chronic cases and their basic human needs. Throughout the 1960s, Gorman continued to press legislators, state health officials, professional groups, and insurance companies to remedy these deficiencies.

The shortcomings of the American mental health system were highlighted for Gorman by a 1967 mental health mission to the U.S.S.R. This three-week tour included (at Gorman's request) not only the Moscow psychiatric research institutes normally shown to foreigner visitors, but clinics in rural areas, plus facilities for children. In sharp contrast to the U.S., the U.S.S.R. had a well-staffed and integrated network of psychiatric services for all age groups and problems, with treatment tailored to individual needs and circumstances. And there were no economic barriers to treatment. Though he found little to envy in the Communist state generally, Gorman wrote a number of articles and speeches endorsing the Soviet mental health system as a model for America.

The brave new vision of community mental health programs was also undercut by the budget realities of the Vietnam era, as the war demanded increasingly larger defense appropriations. Almost from the first, appropriations for the various mental health programs had fallen short of the original recommendations. When Richard Nixon became President in 1969 he fought to balance the budget by slashing social program funding. He tried to phase out federal programs for training mental health personnel and new community mental health centers, leaving the states to decide if they wanted to continue such programs at their own expense. When Congress appropriated the funds anyway, Nixon impounded them. In September of 1973, the American Psychiatric Association, together with many other organizations, sued the administration to release the impounded funds, and won when the U.S. District Court judge ruled that the President had no authority to impound funds. Nixon and his successor, Gerald Ford, continued their efforts to cut these and other programs, however, and Gorman and his allies found themselves fighting to preserve programs they had helped to create only a decade earlier.