A psychiatric disability is standard terminology. The term person with a psychiatric disability is "person first" meaning their disability is part of them and doesn't define them. I don't care for the term "illness", "sick", "disorder" etc. as it conveys someone will never recover. But technically bipolar disorder as medically classified is all those things as the brain doesn't work as it should. I don't really have a problem with the terminology doctors use for medical language but its depressing when people think of themselves as "sick". Of course we all need medication but many of us can live healthy and productive lives and if we assume we can't then our predictions may come true. If I am speaking to someone I don't know I may just say I have a disability and not detail further as they should know there is something going on but don't need to know my whole personal life but its up to each person how and whether they choose to disclose.
Good question. I am always torn between trying to defend myself and my "disorder" to the uninformed who often see it as a disability (when the effects of it are largely responsible for many of my assets) and getting people to understand how debilitating it has proven in my life. Political correctness is responsible for many of these changes.