The film makes it out that its all in his head. However, in the book some of it seems to be real (such as Al the tramp and the dog). As far as I remember its never really made clear though, in either context. Remember, the Paul Allen killing, and his lawyer saying he had lunch with him is irellevant, as all of the people working at Pierce and Pierce got each other mixed up all the time... So we don't know whether its real or psychosis.
If you want to catch up with the character, read Rules of Attraction, Glamorama and Lunar Park, in which he appears briefly in all three.
The official canon of the character is that he marries Jean (the secretary) has a child (Patrick Jr) and enRAB up in therapy for his issues.
I wouldn't call it a thriller with a twist though, I'd say it was a dark comedy, just like the book.