Back in the mid 20th century the word retarded simply meant delayed. It referred to a person who was developmentally behind where they should be for their age. My cousin was 11 years older than me. I played with him when I was a young child but quickly outgrew him mentally as I became school aged. I learned he was "retarded" and would never grow beyond the young child he was mentally, although physically he was growing into young adulthood. He also suffered from epilepsy. My Aunt & Uncle placed him in Letchworth Village in upstate New York which, at the time, was supposed to be an exclusive facility dedicated to helping people like my cousin reach their full potential.
Over the years the word "retarded" began to be used by insensitive people to denigrate others. It was a way to insult someone's intelligence and make fun of them. Naturally, the word has become so negatively charged it is now considered offensive and not politically correct.
You can change the terms used to identify the mentally challenged, but it's hearts and minds that really need changing. Unfortunately, however, some people lack the ability to feel and show compassion to others, even some who work with this vulnerable group. That's why facilities like the infamous Willowbrook (where a coworker of mine lost her child due to neglect) exposed by reporter Geraldo Rivera as a hellhole were closed.