Corewell Health and Select Medical Corporation are teaming up to build an 84-bed rehabilitation hospital on Dequindre Road in Sterling Heights, sitting directly across the street from Corewell Health Beaumont Troy Hospital's emergency department. The four-story, roughly 100,000-square-foot facility is expected to open in 2029, replacing a much smaller rehab unit that's currently packed to the brim inside the Troy hospital itself.
The joint venture, announced this month, pairs Michigan's largest health system with a national post-acute care operator, and the two organizations aren't strangers. As reported by The Detroit News, the new hospital will include 84 private inpatient rooms, a therapy gym, daily activity spaces, dedicated public areas, and dining facilities, offering a full range of rehabilitation services for patients recovering from stroke, spinal cord injury, neurological injury, amputation, or complex orthopedic conditions. Gillian Conrad, a Corewell spokesperson, said a joint venture allows two organizations to be even more effective, according to the same report.
The arrangement builds on a partnership that dates back to 2017, when Select Medical and the legacy Spectrum Health system opened a long-term acute care hospital at Blodgett Hospital in Grand Rapids, according to Corewell Health. Select Medical, based in Mechanicsburg, Pennsylvania, operates critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation centers across the country, per the company's LinkedIn page, the Detroit News report notes. As of this month, Select Medical runs 41 specialized rehabilitation hospitals in 15 states and 103 critical illness recovery hospitals in 28 states, along with more than 1,900 outpatient physical therapy clinics nationwide, according to Becker's Hospital Review.
Troy's Rehab Unit Is Already Nearly Full
The need behind the project is straightforward: Corewell Health Beaumont Troy Hospital's current 22-bed inpatient rehabilitation unit runs at about 90% occupancy, per the Detroit News. Nancy Susick, president of Corewell Health Beaumont Troy Hospital, said the larger standalone facility will help care for patients with more complex medical needs as the population ages, since patients recovering from serious injuries often need intensive therapy before they can go home. Once the new rehabilitation hospital opens, Troy will stop having inpatient rehabilitation beds altogether.
Lamont Yoder, president of Corewell Health in Southeast Michigan, put a number on that shift, stating that the purpose-built 84-bed hospital will nearly quadruple the inpatient rehab footprint currently available at the Troy campus, according to Becker's. Select Medical CEO Tom Mullin said the Sterling Heights facility will extend the post-acute care continuum, allowing patients to move seamlessly from initial acute hospital admission to specialty rehabilitation and home discharge, per the same report.
A Piece of a Much Bigger Expansion
The rehab hospital is one piece of a larger building push at Troy. Corewell also plans to build an eight-story tower at the Troy hospital, valued at $440 million, with construction slated to start next summer. That tower will include more private rooms and a new emergency department waiting room, and Susick said the rehabilitation hospital project is complementary to the tower project, according to the Detroit News. Corewell Health Beaumont Troy Hospital's emergency department handles more than 106,000 patient visits annually while the hospital maintains an average inpatient capacity above 90%, according to CBS News Detroit.
The Troy tower is itself nested inside an even larger statewide push: a $1.7 billion capital expansion that also includes a $1.34 billion, 11-story patient tower at Butterworth Hospital in Grand Rapids, CBS News reported in late August. Corewell Health, formed through the 2022 merger of Beaumont Health and Spectrum Health, is Michigan's largest health system, employing more than 60,000 staff and operating 21 hospitals statewide, per Becker's.
New Ownership, Familiar Partner
Select Medical arrives at the Sterling Heights table under new corporate ownership. The company completed a $3.9 billion take-private buyout in July, led by an investor consortium including co-founder Robert Ortenzio, CFO Martin Jackson, and private equity firm Welsh, Carson, Anderson & Stowe, according to Investing.com. That shift moved Select Medical from public markets back into private equity hands just as it enters this new Michigan joint venture.
Geographically, the project also straddles a county line. Dequindre Road divides Oakland County to the west from Macomb County to the east, meaning the new rehabilitation hospital in Sterling Heights sits in Macomb County even though it faces Corewell's Troy campus, which is in Oakland County, according to the Road Commission for Oakland County.
Regulatory Reviews Still Ahead
The project still has to clear hurdles before any shovels hit the ground. Corewell and Select Medical will need approval under Michigan's Certificate of Need statutory framework, which requires the state's CON Commission to review any new specialty health facility or relocation of licensed hospital beds, per the Michigan Legislature. The Detroit News reports the project is also proceeding through municipal reviews in Sterling Heights.
Cost estimates and a construction start date remain unknown for now. Conrad said Corewell has no cost figures to release at this very early stage of the project, and there is currently no projected construction start date, according to the Detroit News. Corewell Health and Select Medical say they will share more details about the joint venture as plans progress.
This isn't the first time Corewell's operations in Southeast Michigan have drawn scrutiny this year. Hoodline previously reported on Corewell's insurance network dispute with UnitedHealthcare, as well as a federal class-action lawsuit over the system's medical billing and collections practices. The Sterling Heights project also comes amid broader shifts in emergency care capacity across the region, following Hoodline's report that a Southfield hospital lost its trauma status and now sends ambulances to Royal Oak instead.
