>is it possible that the patient in the alternate reality was james?
In essence, yes. The patient they're discussing is Joseph Barkin, who, in the original script--before a massive overhaul--was to be the [otherside] of James, much like Maria is the [otherside] of Mary.
Interesting that his name should be Joseph.
[spoiler]Because, as we know, much is made of the possibility that Henry could be a split-personality type figure due to the fact that everyone he runs into immediately dies, as well as the notes under the door thing. As it turns out, we find that Joseph does, in a way, form the alternate aspect of Henry (the giver - receiver of wisdom). Considering how SH4 pics up on the Walter and Sunderland aspects of SH2 I wouldn't be surprised if the James/Joseph idea was also taken up and formed into the Henry/Joseph aspect we see...[/spoiler]