SPOKANE, Wash.—IPC the Hospitalist Co., the hospitalist physician group based in North Hollywood, Calif., has acquired Hospital Specialists of Spokane, Wash.

Hospital Specialists has acute-care practices in Spokane and Coeur D'Alene, Idaho, that record a combined 40,000 patient visits a year. IPC counts 1,700 affiliated healthcare providers across 23 states. The deal gives IPC its first venture in the Northwest. Financial terms of the deal weren't disclosed. Dr. Bob Zurcher, CEO of Hospital Specialists, was given a new title at IPC as a regional director. “Given the uncertainties and demands of the evolving healthcare environment, our practice group felt it was important to look for a partner who could provide us with the right balance of autonomy and support,” Zurcher said in a news release.

PHOENIX—A reduction in Arizona's Medicaid rolls can go forward, a three-judge panel ruled this week. An Arizona state appeals court upheld a lower court's rejection in July of a lawsuit aimed at barring the Medicaid program from undertaking a major cost-cutting overhaul. Patient advocates sued the state over a new law capping enrollment for childless adults in order to help balance the budget. The advocates maintained that an earlier voter initiative required the state to fund Medicaid coverage for the adults in question but the judges disagreed. “Whether the Legislature has complied with this directive presents a political question not appropriate for judicial resolution,” Judge Patricia Norris wrote in the unanimous ruling of a panel of the Arizona Court of Appeals. The $500 million in Medicaid cuts were necessary, Republican Gov. Jan Brewer wrote in a news release, to close a budget gap and avoid “devastating” cuts in other areas of the state budget. The cuts also aimed to “slow runaway state Medicaid spending that had grown by 65% in just four years.” Separately, the Arizona Hospital and Healthcare Association filed suit in federal court in November seeking to prevent a 5% cut in the Medicaid program's hospital payment rates. The hospitals maintained that when added to four years of rate freezes and payment reductions, the latest cuts will reduce hospital payments 33% below the actual cost of caring for patients.