Cyber-psychosis doesn't just happen, its the result of losing all empathy for other human beings.
The line at which a PC becomes a rampaging cyber-psycho NPC controlled by a GM does occur when a PC's EM stat reaches zero, but this doesn't just happen, a player made a choice to get yet another piece of hardware and overwhelmed themselves in the process. Empathy is a bit of a unique stat for CP2020 in that it doesn't simply represent a skill or ability, but also your state of mind.
"This Stat represents how well you relate to other living things--a measure of charisma and sympathetic emotions. In a world of alienated, future-shocked survivors, the ability to be "human can no longer betaken for granted. Empathy (EM) is critical when leading, convincing, seducing or perceiving emotional undercurrents. Empathy is also a measure of how close he/she is to the line between feeling human being and cold blooded cyber-monster (see pg. 73 for details). - Cyberpunk 18.104.22.168. Core Book p. 26
Because you lose a point of EM for each 10 humanity points lost to cyberware installation the process will be cumulative over time as they cyber up.
There are no published Sanity rules for CP2020
I don't believe that there was every a sanity rule option introduced in any of the chrome books. It is out of tone with the game that they published and the genre as a whole. That isn't to say that you shouldn't do it, simply that the publishers didn't feel it fit.
Fan's have created their own sanity system however based on Chaosium's Call of Cthulu system.
Over at Wlydeside (a fan community), someone has ported/created a sanity stat for Cyberpunk 2020. Essentially you add EM, COOL, and LUCK together and times that by 3 and you have the sanity percentage a character has. Call of Cthulu uses percentile dice for everything so you could have players make sanity checks by rolling 2d10s. and having ill effects if they roll over and have things in the campaign consistently bring their sanity down in the way humanity points lower EM.