Morrow, you have to think about your heroes a little differently. The sanitorium is for when you are ready to move into veteran level or higher runs. Your first, second, third, fourth, fifth ect. generation heroes are not heroes, they are suckers. You lured them to this god forsaken place to help cleanse the land of your family curse, and to make you filthy rich in the process. You don't actually care if they go insane or die... so long as they bring back sacks full of precious heirlooms and money. You are a deplorable sadist gripped by avarice and the overwhelming desire to restore your heritage in the face of sheer madness.
This game really hammers home the concept of the disposable hero. Make sure you focus on upgrading that stagecoach network before anything else and you will never need to worry about running out of bodies. Once you get four people showing up each week, you have a fresh team to pick from every run. They might not be optimal, but they will get some money provided you buy almost no supplies. You are trying to maximize the amount of heirlooms and money per run. Best way to do this is to simply not spend money on supplies or services and to open up every single item you come across. Sure, that guy that just rummaged around in a dead corpse looking for 25 gold might contract space herpes, but he can be replaced. So send him on his way and grab the next sap to do it again. And remember, abandoning a quest to bring back some treasure is infinitely better than having everyone die and getting no treasure.
I like Jesters not because they keep people sane and functioning week to week, but because they save me money. I don't like healers because they keep people alive, I like them because they keep people alive long enough to bring me back wagon loads of money. I don't like the people in this game, I like the money and the heirlooms. The heroes are not my characters, the town is. The heroes are consumable items that give me a temporary buff that allows me to dive into a dungeon and loot the shit out of it so I can level up.
Once you have gotten a bunch of the town structures leveled up and reduced the costs of upgrading heroes and you have collected a bunch of trinkets that make them more effective AND you have a large enough roster to start putting together much more effective party compositions, THEN you can start thinking about really investing into people in order for them to start tackling veteran level stuff. But until then, you just want loot at all costs.
So really, you can just keep plugging away with your current game. Just invest every appropriate heirloom into the stagecoach and do a bunch of runs in the weald to maximize the number of deeds you get.