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Not a Psychological term and as such only applicable in criminal actions, what I believe you want to talk about is if the person is incompetent. The test is similar but is Civil in determination.
An incompetent person can not refuse medication because such a person does not what they are refusing, the problem then is when is a person incompetent.
In most states Incompetence is when a person is a harm to herself (or himself) or others OR otherwise unable to make decisions for themselves.
A person may be unable to work do to psychological problems and still be competent. Thus a person may be on SSI for mental problems but could still refuse to take medication they do not want to take.
A doctor has to examine the person and determine that he (or she) can not make a valid informed decision. One test for this is do they know who they are and what is being proposed to be done to them. Another test is asking them who they are and their relationship to their relatives. The doctor has to show that the person was incapable of making the decision, and even then most issue of incompetency has to be reviewed by a Judge based on the report of the Medical providers (and a person review of the alleged incompetence i.e. by the Judge asking questions to the alleged incompetent to see if she or he is competent or not (i.e. does he or she know what is going on).
I face the reverse situation every so often, I have clients come in to get a power of attorney (POA) for someone sick in the Hospital. The Hospital wants them to have it in case decision has to be made as to medical treatment. Power of Attorneys can only be made if a person is competent (even if that person has not been ruled by a Judge to be in-competent). I generally prepare the POA and then go to the hospital. I than ask the patient several questions to see if he or she knows what she or he is signing. One question I ask is I tell them their agent (generally their spouse) can use that power of Attorney to clear out their bank account, throw them into the street, sell their home, their car, their furniture and than have a good time in Atlantic City with their new flame. I generally get a laugh about that or a comment like "She would get far on those proceeds" etc. I know then they are competent, they know what they are signing, and its ramifications. They may be bed-ridden, slow to speak, may only work up a grin instead of a laugh, but they have to show that they know what they are signing. I have had clients who just could not do that and I had to refuse to go forward with the POA (If they do not know what they are signing the POA is NOT valid, incompetency at the time of signing the POA invalidates the POA).
Aside to my fellow lawyers, In Pennsylvania all POA are now Durable POAs and survive incompetency. I still use the term "Durable Power of Attorney" in my POA do to the Common law rule that incompetency ended POAs. To non-attorneys, the States created Durable Power Of Attorneys many decades ago so that people could have POAs that survive their incompetency, these were, and are, called "Durable Power of Attorneys".
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