If you're happy because your perception of reality is very far off from reality, yes. That is psychosis. If I see myself in a mansion and I'm currently in a box under the freeway that is an hallucination.
You're conflating an emotion (happiness) with perception (living somewhere you don't live).
You certainly can give someone medication because they have a negative emotion, but you don't typically give them medication for positive emotions. Unless, it is affecting their life in a negative way.
