This paper examines the utilization patterns of traditional and modern health services in Indonesia, using household sample survey socio-economic data in conjunction with community-level data on availability of services. The results strongly suggest that low household income is a barrier to the utilization of modern health services, even where they are publicly provided. The relatively well-to-do use the services of trained practitioners and physicians more and spend more on these services than do the poor. That is, income has a qualitative effect shown as a shift to more expensive and sophisticated practitioners and services rather than increased expenditures on the same type of services. Nevertheless, public facilities do make a difference; where they are available people prefer them to indigenous practitioners.

Despite limitations of data and method of estimation, it is clear that both income and availability of services matter and hence that public services are more important to the poor than to the rich. The results further suggest that exposure to modern services that may involve health education brings about the right kinds of substitutions from an efficiency viewpoint: paramedics for traditional practitioners as well as physicians.