Just play through the game not taking any pills for your sanity, and this acheivement should be gotten easily.
For some extra sanity decreases, make sure to turn on the radio and let it play until the supernatural phenomenon occurs, take a picture looking into the shower, and open the toilet stall in the women's restroom after hearing the scream.
Once you reach 0 sanity, the screen will go black, and some bloody red text will appear saying you lost your sanity. The achievement will have unlocked at this point.