US-based Encompass Health and Covenant Health have agreed to form a joint venture to own and operate the latter’s Patricia Neal Rehabilitation Center in Knoxville, Tennessee.

Encompass Health and Covenant Health intend to submit two certificate of need applications.

According to the partners, the first application will be to construct a new 51-bed inpatient rehabilitation facility on Covenant Health’s Fort Sanders West campus in Knoxville.

The second application will be to refurbish and convert the existing Patricia Neal Rehabilitation Center into a 22-bed hospital-in-hospital facility. As part of the renovation, the hospital’s semi-private rooms will be converted to private rooms.

Patricia Neal Rehabilitation Center is set to remain open during the renovation period. The construction of the new hospital, as well as the renovation are expected to complete in 2022.

The inpatient rehabilitation facilities are intended to cater to patients recovering from debilitating illnesses and injuries such as strokes and other neurological disorders, brain injuries and complex orthopedic conditions.

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Covenant Health president and CEO Jim VanderSteeg said: “Part of our long-term strategic plan for enhancing the Fort Sanders Regional Medical Center campus includes a $15m investment in modernisation to the existing Patricia Neal Center, as well as building an additional new rehabilitative hospital to serve the west Knoxville and surrounding areas.

“These investments total in excess of $50m and are in addition to more than $200m that we invested recently in the expansion of Parkwest and Fort Sanders Regional.”

The establishment of the joint venture is subject to customary closing conditions and its operation of both hospitals is contingent on regulatory approvals.

Last month, Encompass Health opened the Encompass Health Rehabilitation Hospital of Sioux Falls in South Dakota, US.