JOHNSON CITY, Tenn. -

Mountain States Health Alliance will expand their services in Johnson City -- that means new life for an old hospital and more jobs.

MSHA said Wednesday they'll be expanding their inpatient rehab and skilled nursing services in Johnson City.

Mitch Miller, the president of the Washington County Economic Development Council, tells us this is big for the county. "Partnerships like this, the opportunity for new job creation, more investment it's only going to lead to more commerce. We're fortunate to have an organization like Mountain States here in Washington County," he said.

We found out Mountain States generates close to $400 million for the county alone per year, and it could become even more.

Alan Levine, Mountain States President and CEO, says they reached a deal with HealthSouth Corporation to create a partnership to expand services at Quillen Rehabilitation Hospital. "We're trying to create alternative care settings that are lower-cost that help people retain the dignity of independence," he said.

Levine says currently there are 26 inpatient beds; HealthSouth intends to add at least ten beds. "These investments that we're making today will help provide the services that our seniors are going to need as they age," he said.

Levine tells us Mountain States also signed a letter of intent with the company Signature HealthCARE to develop an assisted living community and skilled nursing facility.

The new skilled nursing facility will be built on the campus of the old North Side Hospital, and will have 47 skilled nursing beds and 60 assisted living beds. "By investing in what will be demolishing the old hospital and building a new facility, there is another 16 to 20 acres around it that we could possibly develop," adds Levine.

Levine hopes the new facility will bring an additional 100 jobs with it, something Miller says is great for the county. "With that you'll see the spinoff of folks visiting here, spending their dollars in sales tax, deciding to locate here. New jobs, new construction, all those kind of play together," he said.

Levine says construction for the new facility at the old North Side Hospital should begin within in the next two years. He says they hope to have services expanded at Quillen by the Fall.