This happens even at large zen monasteries. Truth is, Buddhism has no mechanism for distinguishing between mental illness and the usual suffering all samsaric beings experience. Therefore, Buddhist teachers cannot deal with mental health emergencies: all mental suffering is seen through the Buddhist lens
I've seen this too; guy had a bipolar episode. Teacher told him he'd ruined everything, and would have to start again.
More generally, Buddhist medicine would be a good thing, as Ghandi might have put it. The heart of Buddhist medicine is that life is short, suffering is unavoidable, and that the best treatment is to teach and practice Buddhism.
