BACKGROUND: There are few reports on the effects of extensive decentralization of mental health services. We investigated the total patterns of utilization in a local-bed model and a central-bed model. METHODS: In a time-trend case-registry design, 7635 single treatment episodes, from the specialist and municipality services in 2003-2006, were linked to 2975 individual patients over all administrative levels. Patterns of utilization were analyzed by univariate comparisons and multivariate regressions. RESULTS: Total treated prevalence was consistently higher for the central-bed system. Outpatient utilization increased markedly, in the central-bed system. Utilization of psychiatric beds decreased, only in the central-bed system. Utilization of highly supported municipality units increased in both systems. Total utilization of all types of services, showed an additive pattern in the local-bed system and a substitutional pattern in the central-bed system. Only severe diagnoses predicted inpatient admission in the central-bed system, whereas also anxiety-disorders and outpatient consultations predicted inpatient admission in the local-bed system. Characteristics of the inpatient populations changed markedly over time, in the local-bed system. CONCLUSIONS: Geographical availability is not important as a filter in patients' pathway to inpatient care, and the association between distance to hospital and utilization of psychiatric beds may be an historical artefact. Under a public health-insurance system, local psychiatric personnel as gatekeepers for inpatient care may be of greater importance than the availability of local psychiatric beds. Specialist psychiatric beds and highly supported municipality units for people with mental health problems do not work together in terms of utilization. Outpatient and day-hospital services may be filters in the pathway to inpatient care, however this depends on the structure of the whole service-system. Local integration of psychiatric services may bring about additive, rather than substitutional patterns of total utilization. A large proportion of decentralized psychiatric beds may hinder the development of various local psychiatric services, with negative consequences for overall treated prevalence.