This is not a New Kadampa Tradition (NKT) policy at all and is contradictory to the teachings. Any cases of this happening need to be reported straightaway to the NKT Office.
NKT Teachers are not qualified medical practitioners, so they cannot and should not advise their students on whether or not to take medications. In all cases, an NKT Teacher must advise a student who has mental health issues or physical sickness to consult their doctor. Ven. Geshe Kelsang himself has on innumerable occasions advised his students to follow the advice of their doctors.
In The New Eight Steps to Happiness, Geshe Kelsang says:
There is no point in our enduring suffering needlessly, such as by refusing to accept medical help when we are seriously ill. We may think ‘As a Lojong (training the mind) practitioner, I can solve all my problems through my inner strength alone’; but in fact by refusing help we are breaking the Lojong commitment to ‘Remain natural while changing your aspiration’. According to the Kadampa Tradition of Je Tsongkhapa, even if we have high realizations we should observe the conventions of ordinary society. Since it is customary to accept medical treatment when we are sick, we should not attract undue attention to ourself by refusing it if it can help us, even if we are mentally strong enough to bear the pain unaided. Je Tsongkhapa’s tradition of outwardly remaining like an ordinary person whilst inwardly cultivating special minds is very practical and beautiful.