In keeping with psychiatric philosophy at the time, the hospital quickly took on the roll of a custodial institution - an overcrowded warehouse for the incurable. Figures issued in May 1959 indicated that of more than 6,500 patients, 2,200 were seniles, another 1,500 were destructive and/or assaultive, 845 were in two locked buildings for over active patients, 210 were physically ill and housed in infirmaries, and more than 300 were active or inactive tuberculosis or typhoid carriers, housed in a special TB building. With this also came tales of abuse and neglect. With insufficient funds, the asylum had quickly fallen into disrepair, and patients wound up sleeping in hallways, and raw sewage was found on the bathroom floors during an inspection of the facility. For a long time - during the hospital's term under city control - interns were hired without any training or significant selection process. The hospital was desperate for workers willing to deal with the hospital's conditions for the meager pay that the city was willing to offer. Thus the staff was fraught with drunks, transients and otherwise unemployables.
In 1938, the asylum was finally signed over to the state, where it had complete control and enough funding to expand the facility to the current needs. In the 1940's, the hospital, now called Philadelphia State Hospital but still referred to by the name of the area, Byberry, underwent an enormous expansion at the rate of one building each year until 1953 - more than 30 of those were patient buildings. Despite the change in ownership from City to State, and the subsequent construction, the hospital retained its reputation as a last resort asylum.
By the 1960's, Philadelphia State Hospital consisted of over 50 buildings, and approximately 6500 patients and 1300 staff members claims "An Anthropological Study of the Rehabilitation Unit of The Philadelphia State Hospital". But in the 1970's, the large staff buildings began to empty out as the workers would much rather commute than live on the grounds. Deinstitutionalization took it's hold on this hospital, and most of it was evacuated throughout the 1980's.
Byberry was, throughout its history, the subject of one investigation after another - almost continuously under the microscope by one of a host of governmental agencies or special interest groups. Horrid living conditions were publicized after a thorough investigation once again, including inadequate treatment, mismanagement, and patient abuse such as sexual exploitation and starvation. The hospital was ordered to close, and it's last patients left in June of 1990. Remaining patients were shifted either to Norristown State Hospital or to mental health community centers who were stealing funding from large mental health hospitals as deinstitutionalization continued.
On June 14, 2006, a ceremony was held to celebrate the beginning of the complete demolition of Byberry, and the future construction of a large adult living community, and an office park consisting of 8-10 story office buildings, on the former hospital grounds. Abatement and demolition started with "C" buildings, followed by the "W" buildings, and ended with the "N" buildings. The only remaining buildings are used for private drug/alcohol rehabilitation.