On July 15, officials broke ground on the 54,500-square-foot Warm Springs Rehabilitation Hospital of Kyle. The $16 million project is a joint venture among Seton Healthcare, Post Acute Medical and Avail Healthcare Ventures.

Seton officials said the project is expected to open in June 2014 at 5980 Kyle Parkway.

Seton Ventures & Alliances CEO Tom Gallagher said the new hospital would lower the overall health care costs for patients needing rehab services.

"Rather than these people staying in the acute hospital for the entire duration of their rehabilitation needs, they get discharged from the acute hospital and enter the rehab hospital where the cost is less," Gallagher said.

Rehabbing patients currently have to drive to Austin or San Marcos for rehabilitation care.

The new hospital will feature 40 private rooms and will specialize in rehabilitation from stroke, brain and spinal cord injury, amputation, major trauma, movement disorders and orthopedic conditions.

Under terms of the partnership, Seton and Post Acute will jointly operate the hospital, and Avail will lease the property to the two companies.

"The joint venture is a perfect fit given Seton Hays' growth and the market dominance Post Acute Medical has with its Warm Springs Rehabilitation and [long-term acute care] facilities in Luling, New Braunfels, San Antonio and Victoria. Together we can achieve clinical integration and a more seamless care delivery system, which results in excellent patient care as well as optimal preparation for accountable care," said Anthony Misitano, president and CEO of Post Acute Medical, in a prepared statement.

Warm Springs has more than 20 hospitals and outpatient facilities in Texas and Louisiana.

Gallagher said he expects the hospital to staff 100 to 150 nurses, therapists and physicians.

"Seton is excited to be a part of this new venture, and we look forward to opening it and taking care of patients in about a year," Gallagher said.