The beauty and horror of the internet is that we can access
all the information; the internet provides us information from
everywhere. Meanwhile, there is scientific theory to suggest that our mental capacity to handle information is ultimately finite; for example, Dunbar's Number[1] and the Paradox of Choice[2].
This means unfettered use of the internet can lead to information overload. In addition, because information from the internet most likely concerns things far away[3], you quite literally have no fucks left to give to concerns local and actually relevant to you (see: Dunbar's Number[1]).
The answer is, of course, the same as everything else we consume: In moderation.
Use the internet in moderation. Too much internet is bad for you just like too much water or oxygen is bad for you. Stop doomscrolling through sensation after sensation and running your brain literally dry of mental fuel; instead, get out into your reality and live. Touch grass, because that grass is more relevant to you than whatever the fuck the Sensation Industrial Complex is peddling onto you via the internet.
Kneejerking as you suggest ("keep away at all costs") is, well, kneejerking and doesn't actually look at the problem.
>what in particular is driving mental health outcomes down.
When you subject yourself to an endless onslaught of sensational negative "news", the logical conclusion is you end up depressed and mentally ill. You are what you consume, this includes non-tangibles like information.
This has actually been pointed out since long before even the internet[4], because "journalism" has always preferred sensational hit pieces that pull on viewers/readers' emotional purse strings since they garner more revenue. The internet enabling easier distribution of and access to information simply exacerbated this problem. Good news isn't good business.
[1]: https://en.wikipedia.org/wiki/Dunbar's_number
[2]: https://en.wikipedia.org/wiki/The_Paradox_of_Choice
[3]: War in Ukraine! Uprising in Syria! Oppression in China! Congress in turmoil! The EV revolution in Scandinavia! Here's what King Charles had for dinner!
[4]: https://www.goodreads.com/quotes/10001-if-you-don-t-read-the...