They call it an illness so they can treat it -- I don't agree that the "medical model" of psychology makes sense, but at this point it's what insurance companies accept so that's how the system is set up.

You are diagnosed with a condition, such as PTSD, depression, etc, ONLY so (1) they know how to design your treatment and (2) insurance companies will pay for it. That's it. But many therapists don't work strictly according to the DSM, as it is a flawed instrument with many symptom overlaps. Many people have multiple conditions, many different conditions are treated the same way, there is huge symptom overlap, and two professionals may totally disagree about your diagnosis.

It sucks that it's called mental illness, because of the stigma.

It's called mental illness, so insurance companies will pay for it and so society will take it seriously.

But "mental illnesses" are common. People have issues. They just do -- it's NORMAL. And it's becoming more and more commonplace to seek mental health treatment. Mental illness is just a term - try not to get too wrapped up in the language.