Blue/Orange (Young Vic)

A huge hit for the National in 2000, Joe Penhall's Blue/Orange is a contemporary classic – an evisceration of all things New Labour, from a strained NHS to tip-toeing political correctness and, above all else, a clinical dissection of institutional racism.

Set in the psychiatric wing of an NHS hospital, it shows two white doctors arguing over a young black patient with borderline personality disorder, Christopher, after 28 days under section.

Young idealistic Bruce believes him schizophrenic, worth keeping in, given that he sees oranges as blue and insists his father is Idi Amin, while senior consultant Robert, wants Christopher released – partly out of limited resources, partly for his own good, and partly to mitigate against the very possibility of institutional racism.

It's not that either doctor is racist, per se, but that the psychiatric system, its definitions and methodologies, works against black men. If sanity is, in its way, conformity, then cultural and linguistic differences interfere with diagnosis. Christopher's insistence on calling QPR fans, "zombies" – understandable given their throwing bananas his way and pissing through his letterbox – is taken as evidence of delusional activity. His suspicion of authority, after years of stop and search, counts against him, and he's bamboozled by the two doctors' technical terminology.

And yet, Christopher so clearly needs help. Penhall's masterstroke is to press that home, and Daniel Kaluuya plays him without pity, prone to swings from playful mischief to explosive aggression. Whether he's schizophrenic or not is, in practice, by the by. One way or the other, the system fails him – either abandoning him altogether or damning him to a life in and out of care. As Catch-22's go, it's a blinder.

That's what gives Penhall's play its power, but – and this came as a surprise – it hasn't aged well. Written today, it would come in half an hour shorter, crisp and compact, and it could do with a retune to tighten the strings. At times, it feels contrived, as Penhall strains to keep the three men in one room. Jeremy Herbert's design maroons them on an in-the-round island.

It doesn't help that it's become a period piece. (Remember smoking indoors?) It's still relevant – institutional racism's hardly been remedied – but it's retrograde too, and we've come just far enough to distance ourselves from the doctors. The time difference lets us off the hook.

Matthew Xia's production, though it shows how people dissolve into institutions, is somewhat off the pace, swallowing several key moments and never quite detonating. It suffers from a surfeit of acting. Kaluuya's restlessness lessens his physical threat – as does a clunking 'Lahn-dahn' accent – and Luke Norris's jittery junior is no match for David Haig's smarmy suburban bulldozer. He hasn't the youthful arrogance to stand up to his superior or to ingratiate himself, cringingly, with his patient. Penhall's three-hander needs to be a match between equals. Here, it's not.

Blue/Orange runs at the Young Vic until 2 July.