This is a grey area, and it gets complicated when normal reactions and illness get defined as one or the other. There is an increasing array of diagnoses and I doubt very much that a person has 10 different mental health conditions, though there are psychiatrists out there who like to slap labels on their 'boxes'. In reality a person is multidimensional and their issues will be complex. Some normal reactions, I think if there is logic in something how ever unpleasant it is there will always be argument that its not purely illness. Psychotic experiences are not always negative, it can depend on their nature and the person who experiences them/how they react to it.
We are so complex and perception is everything, a woman going through child birth may be in agony and feel like they are dying of pain, another may mentally cope and see it as positive pain, symbolising an very special event. I guess that is a bit of a duff explanation but illness is perhaps too strong a word for some of the things people go through and 'emotional experience' might be a better phrase.
Part of the lag in understanding is because nobody else can view the mental images, beliefs and experiences of another and as a society I think there is a lot of shame, stigma and lack of understanding for someone else's experiences that are different to our own. It can b quite a skill to empathise but even more to not immediately feel the abnormal if someone sees things that you do not or hears things that you do not.
I have not seen the video but I would imagine that it pertains to private hospitals with corrupt staff that are trying to make money rather than help people.
To summarise, experiances are real, but the idea that certain experiances should b firmly classed as illness is not so. I dont believe psychiatric doctors in this country are paid for the illness they diagnose to treat but of course there are treatments that cost different amounts. Thankfully there is a separate regulated process that evaluates treatments, nice guidelines for example.
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