Council approves joint venture, financing steps for new 40–50‑bed inpatient rehab hospital on CRMC campus

The Cookeville City Council on May 15 approved two measures enabling Cookeville Regional Medical Center (CRMC) and Encompass Health to build a new inpatient rehabilitation hospital on the CRMC campus: authorization for CRMC to borrow up to $13,000,000 to support development and construction, and approval of the joint‑ownership arrangement between CRMC and Encompass Health.

CRMC representatives told the council the project will be a joint venture with Encompass Health and is expected to be a roughly $60,000,000 investment. CRMC said the plan calls for an initial 40‑bed tower with private rooms that could expand to 50 beds; Encompass vice president Melanie Lewis said the facility will deliver hospital‑level inpatient rehabilitation care for patients recovering from stroke, brain injury and major surgeries. Lewis said inpatient rehab is a 24‑hour, hospital‑level service and that Encompass operates more than 160 hospitals nationally, many as joint ventures with acute care hospitals.

Melanie Lewis said the initial facility will employ roughly 115 total full‑time equivalent positions when it opens — largely clinical staff including nurses and therapists — and that headcount could grow to about 150 FTEs as the facility expands to 50 beds. CRMC staff said they expect about half of the project spend to flow to local contractors and suppliers. Officials told the council construction would begin in early 2026 with an estimated 14–18 month construction window.

Councilman Walker moved approval of the borrowing authorization and Councilman Baji seconded; the council voted 4–0 to approve the request to allow CRMC to borrow up to $13,000,000. The council then approved the joint ownership arrangement 4–0.

CRMC representatives said the new rehab hospital should improve throughput at the acute care hospital by providing an appropriate discharge destination for patients who need inpatient rehab but currently occupy acute beds. CRMC said the new facility would also reduce patient transfers out of the area and keep families closer to care.

The council did not discuss detailed repayment terms for the borrowing authorization during the meeting; CRMC and Encompass representatives answered questions about staffing and timing. The items passed on unanimous votes and staff will return with further project details and implementation steps as work proceeds.