I'm looking for information on people who were unable to work because of schizophrenia or other major mental illness. Does anyone know what happened to them in the USSR?
People who were declared handicapped because of some medical condition received some pension (material help from the state) and other benefits. There were several categories depending on severity of handicap. Those who could and wanted to work also worked. There were co-operatives of handicapped people who could do certain simple kinds of work.
This applied to all sort of illness, including mental illness, including schizophrenia. Those who were considered dangerous were confined to mental hospitals.
Source: I knew several of such people. They were not permanently confined in asylums, just hospitalized for short time of treatment.
EDIT. Another aspect of this matter is that some normal people who criticized the regime were declared insane and confined in mental hospitals against their will. But this is another matter, probably not related to the question. https://www.newscientist.com/article/mg13217951.100-soviet-union-admits-to-abuses-of-psychiatry/