Rural hospitals occupy a unique place in the American healthcare system. They are not simply businesses competing for patients; they are often the economic and medical infrastructure upon which entire communities depend. When a rural hospital loses money, the consequences can extend far beyond its balance sheet—to emergency care, employment, physician recruitment, access to specialists, and the economic vitality of the communities it serves.
Self Regional Healthcare in Greenwood, South Carolina, provides an important case study of these pressures.
Self Regional was created to bring hospital care to the residents of Greenwood and the surrounding rural communities. Its history dates to the aftermath of a 1944 tornado that destroyed Greenwood’s original hospital. Construction of a new facility began in 1948, and Self Memorial Hospital opened in 1951. The institution was established with philanthropic support from James C. Self Sr. and was designed to serve residents of Greenwood and the surrounding seven-county region.
More than seven decades later, Self Regional remains a major healthcare institution—but the economic environment surrounding rural healthcare has changed dramatically.
Self Regional: A Regional Healthcare Institution, Not Merely a Small Hospital
Today, Self Regional Healthcare describes itself as an independent, not-for-profit health system serving approximately 300,000 residents across South Carolina’s Lakelands region. Its system includes a 358-bed flagship hospital and two 25-bed critical-access hospitals, along with numerous outpatient and specialty locations. The organization reports more than 3,900 employees and more than 500 providers covering more than 40 specialties. The scale of its community impact is substantial.
Self Regional reports approximately:
626,000 patient visits annually
59,204 inpatient days
12,182 inpatient discharges
74,453 emergency-room visits
1,154 births
$42 million in charity care in FY2025
$838 million in total economic impact
5,247 jobs sustained directly, indirectly, and through induced economic activity
These figures illustrate an important point: describing Self Regional simply as a “small rural hospital” understates its role. It is a regional referral center that provides sophisticated services—including trauma care, neonatal intensive care, cancer treatment, cardiac care, orthopedic services, and other specialty programs—to a population spread across a largely rural geography.
The challenge is that the hospital must maintain many of the same expensive services as larger urban institutions while operating in a market with a substantially different economic and insurance environment.
The Lexington Medical Center Comparison
The contrast with Lexington Medical Center is striking.
Lexington Medical Center, located in West Columbia, operates a 607-bed hospital and a much larger healthcare network. Its community health assessment reported more than 7,800 healthcare professionals, approximately 100,000 emergency-department visits annually, more than 4,000 births and more than 25,000 surgeries.
The underlying economic environments are also different.
Lexington County has an estimated 2020–2024 median household income of $77,408, compared with $52,830 in Greenwood County. Lexington County’s per-capita income is approximately $39,667, compared with $31,408 in Greenwood County. The poverty rate is also lower in Lexington County—11.3% compared with 16.3% in Greenwood County.
Those differences matter to healthcare economics. Payor mix in Self Regional is much worse than Lexington Medical Center which affects their per patient revenue numbers.
A hospital’s financial performance depends not only on the number of patients it treats, but also on who those patients are, what insurance they have, what services they use, how much insurers pay for those services, and the hospital’s ability to spread fixed costs over a large volume of profitable services.
In this environment, a hospital serving a larger, faster-growing, higher-income market can have economic advantages that are difficult for a rural regional hospital to reproduce.
Population and Market Differences
Lexington County’s population was estimated at 317,588 in 2025, representing an 8.1% increase from its 2020 base. Its population density is approximately 421 people per square mile.
Greenwood County, by contrast, has a population density of approximately 152 people per square mile. Its median household income is nearly $25,000 below Lexington County’s.
This creates a fundamental economic difference.
A rural hospital must often maintain emergency departments, operating rooms, intensive care, obstetrics, diagnostic imaging, laboratory services, specialists and other infrastructure regardless of whether daily patient volumes are high enough to fully cover those fixed costs.
The larger metropolitan hospital has the potential to spread those costs across a much larger patient base.
The Insurance Payment Question
This brings the discussion to one of the most important—and least transparent—questions in American healthcare:
How much does an insurer actually pay different hospitals for the same service?
Hospitals publish enormous quantities of pricing information under federal hospital price-transparency requirements. Lexington Medical Center, for example, publishes machine-readable files containing negotiated rates with third-party payers. Self Regional likewise publishes its hospital pricing files and notes that the actual amount a patient pays is determined largely by the patient’s insurance coverage and the negotiated agreement between the insurer and provider.
BlueCross BlueShield of South Carolina also publishes machine-readable transparency files containing negotiated in-network rates and other pricing information. The company says those files are updated monthly.
That information creates an opportunity for regulators, researchers and journalists to conduct something that has historically been extremely difficult: compare actual negotiated payments for identical procedures across hospitals.
A Potentially Significant Payment Disparity
According to payment figures supplied for this analysis, the reported negotiated amounts for two CPT procedures paid by BlueCross and Blueshield of South Carolina differ substantially among South Carolina hospitals.
CPT Code 47562 Procedure Laparoscopic removal of gallbladder
Lexington Medical Center $2,892.57
Prisma $1,724
Self Regional $1,200.00
CPT Code 12001 Simple wound repair
Lexington Medical Center $168.75
Prisma $158.25
Self Regional $119.00
Since these figures represent the same insurer (BCBS of SC), the same network, the same site-of-service conditions and comparable contractual circumstances, the differences would warrant serious investigation.
For CPT 47562, the reported Lexington payment is approximately 141% higher than the Self Regional amount.
For CPT 12001, the reported Lexington payment is approximately 42% higher than the Self Regional amount.
The question is not whether every difference in reimbursement is improper. The question is whether systematic differences in negotiated reimbursement exist after controlling for legitimate contractual and clinical differences—and, if they do, why?
Why BlueCross BlueShield of South Carolina Deserves Examination
BlueCross BlueShield of South Carolina is an important participant in the state’s health insurance market, and its negotiated rates with hospitals are now subject to greater public scrutiny because of federal price-transparency requirements.
This creates a potentially valuable avenue for public policy research.
If a dominant commercial insurer pays substantially different amounts to hospitals for the same procedures, policymakers should be able to determine why this happens
The Rural Hospital Problem Is National
Self Regional’s situation should also be viewed within the broader financial crisis affecting rural hospitals.
A recent analysis from the Center for Healthcare Quality and Payment Reform reports that more than 700 rural hospitals lost money in 2024, with more than 350 experiencing losses exceeding 5%. The organization identifies low private-insurance payments and patient bad debt among the major contributors to financial losses at small rural hospitals.
Its broader analysis estimates that more than 700 rural hospitals—approximately one-third of rural hospitals nationwide—are at risk of closing, with more than 260 described as being at immediate risk under its methodology.
The underlying economic problem is nevertheless significant: rural hospitals generally have lower patient volumes and fewer opportunities to compensate for inadequate reimbursement through highly profitable service lines.
The Two-Sided Consequence
The payment issue creates a potential two-sided problem.
On one side is the rural hospital.
If reimbursement for commercially insured patients is persistently low relative to the cost of providing care, the hospital has fewer resources to recruit physicians, purchase technology, expand specialty services, maintain facilities and subsidize essential services that may not be profitable.
On the other side is the consumer.
If another hospital receives (LMC) substantially higher negotiated reimbursement for the same procedure, those higher payments ultimately become part of the cost of the healthcare system. Depending on how insurers and employers structure premiums and benefits, higher negotiated rates can contribute to higher healthcare spending.
This produces an unusual policy question:
Can a payment system simultaneously place financial pressure on a rural hospital while increasing the cost of healthcare in a more affluent market?
South Carolina Has Already Recognized the Rural Payment Problem
The state has taken steps to address rural hospital finances in Medicaid.
In November 2024, the South Carolina Department of Health and Human Services announced changes to the state’s Medicaid payment methodology that supplemented outpatient hospital fee-for-service rates for South Carolina-defined rural hospitals. The stated purpose was to maintain and enhance access to quality care in rural communities.
That policy action recognizes a fundamental reality: maintaining healthcare infrastructure in rural communities can require payment policies different from those used in densely populated markets.
The same question should therefore be asked of commercial insurance.
What Regulators Should Investigate
South Carolina policymakers could undertake a systematic examination of hospital payment data. The state could request or analyze de-identified claims and negotiated-rate data for major commercial insurers and compare reimbursement across hospitals for identical CPT and DRG codes.
The analysis should include:
Self Regional Healthcare
Lexington Medical Center
Prisma Health hospitals
Other independent rural hospitals
Critical-access hospitals
Large urban and suburban hospitals
The analysis should then control for factors that legitimately affect reimbursement, including hospital type, trauma designation, teaching status, service complexity, geographic market, case mix, outpatient versus inpatient setting, and insurance product.
The central question would be straightforward:
Are rural hospitals systematically paid less than larger hospitals for comparable services by the same commercial insurers?
If the answer is yes, policymakers should then determine whether the disparity reflects legitimate differences in contracts and costs—or whether changes in healthcare payment policy are warranted. BCBS of SC’s fee schedule shows that payment disparity is substantial.
Transparency Could Change the Debate
The healthcare industry has historically operated with limited public visibility into the actual prices paid by insurers.
That is beginning to change.
Self Regional’s transparency page provides downloadable pricing information, while Lexington Medical Center publishes negotiated-rate information, and BlueCross BlueShield of South Carolina maintains its own transparency files. The data now exist to conduct a much more sophisticated analysis.
Instead of debating rural hospital finances in general terms, South Carolina could examine millions of individual negotiated rates and determine exactly where payment disparities occur.
That would move the discussion from anecdote to evidence.
The Stakes for Rural South Carolina
Self Regional Healthcare is not simply another employer in Greenwood. It is a major economic institution and a critical component of the healthcare infrastructure serving approximately 300,000 people across the Lakelands.
The system reports more than $838 million in economic impact and more than 5,000 direct, indirect and induced jobs. It also provided $42 million in charity care in FY2025.
Its survival and ability to expand services therefore have consequences far beyond hospital administrators and physicians.
The question is not whether every hospital should receive the same reimbursement.
Hospitals differ. Markets differ. Costs differ. Services differ. Patient populations differ.
The more important question is whether rural hospitals are being placed at a structural disadvantage in commercial insurance negotiations—and, if so, whether that disadvantage is contributing to the erosion of rural healthcare access. There is no good explanation why BCBS of SC will pay LMC twice more than it pays Self Regional.
Self Regional provides a compelling case study because it sits at the intersection of these issues: a sophisticated regional hospital, a predominantly rural service area, lower household incomes than nearby metropolitan markets, substantial uncompensated care, and the need to maintain expensive specialty and emergency services.
Conclusion
The future of rural healthcare may ultimately depend less on whether rural hospitals can become more efficient and more on whether the payment system recognizes the unique economic role these institutions play.
Self Regional Healthcare has existed for more than 70 years because South Carolina’s Lakelands region needs a hospital capable of providing care close to home. Today, that mission includes trauma care, cancer treatment, cardiac services, neonatal intensive care, surgery, emergency medicine and dozens of other specialties.
The economic question is whether the payment system gives such an institution a sustainable foundation.
The reported reimbursement differences for procedures such as CPT 47562 and CPT 12001 deserve independent verification and, if confirmed across a broader sample, closer scrutiny.
South Carolina legislators and regulators have an opportunity to use the state’s newly available healthcare price data to answer a fundamental question:
Does the current commercial insurance payment system adequately support rural hospitals—or does it systematically reward hospitals operating in larger and more affluent markets?
That question should be answered with data.
And if the data reveal a persistent rural reimbursement disadvantage, policymakers should determine what, if anything, should be done to ensure that the residents of rural South Carolina do not ultimately pay the price through reduced access to local healthcare.
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