OBJECTIVE: To document differences in provider behaviour between private and public providers in hospital outpatient departments, health centres and clinics in Bangkok, Thailand. METHOD: Analysis of the characteristics of 211 taped consultations with simulated patients. RESULTS: Private hospitals and clinics were significantly more responsive. Private clinics but not private hospitals were also significantly more patient-centred. All doctors, but particularly those in private hospitals, prescribed unnecessary and potentially harmful technical investigations and drugs. The direct cost to the patient varied between 1.5 (in public health centres) and 12 (in private hospitals) times the minimum daily wage. The combined cost--to the patient and to the state--in public hospitals and health centres exceeded the cost of consultations in private clinics. CONCLUSION: Market incentives favour responsiveness and a patient-centred approach, but not more appropriate therapeutic decisions. Excessive use of pharmaceuticals is observed among public as well as private providers, but is most pronounced in private hospitals. If patients in Bangkok want to maximize responsiveness and degree of patient-centred care and yet minimize costs and iatrogenesis, they would benefit from avoiding hospitals, both public and private, and, to a lesser extent, specialists. Choosing to use primary facilities, health centres and clinics, particularly when consultations are carried out by general practitioners (GPs), is more beneficial than choosing between public and private providers.