IPC the Hospitalist Co. is an oddity among Southern California physician groups. Based in North Hollywood since its 1995 founding, the manager of hospital-based physician practices has never had a real presence in its own backyard.

That changed with last week’s acquisition of Inland Hospitalist Medical Group Inc. in Riverside. Analysts say the L.A.-area medical community should consider the deal the first of many IPC will want to make in the region.

“IPC likes to have depth in their markets, and many of the acquisitions they’ve made over the past year reflected that,” said Jeff Hoernemann, an equity analyst with Minneapolis-based Feltl and Co.

IPC has on its rolls more than 1,600 physicians at 600 facilities in 22 states. The physicians are hospitalists, who manage treatment of inpatients often needing complex care.

The company expanded aggressively last year, making 15 acquisitions in several states. The Riverside deal is the second this year. IPC has been able to strike merger deals with small practices that believe the larger company can more efficiently handle administration and billing.

Investors have approved of the strategy, sending shares up 8 percent over the last 12 months. Shares closed at $39.17 on Jan. 27.

More challenging health care economics have made the hospitalist practice an increasingly attractive specialty, analysts said. As hospitals struggle to make ends meet with lower reimbursement rates, administrators like having hospitalists on staff as a way to more cost-effectively manage care. Meanwhile, financially stressed general physicians can’t see as many patients if they have to make hospital rounds, so referring inpatients to a hospital-based physician makes economic sense.

“The demand for hospitalists is far exceeding the supply,” said Brian Tanquilut, an equity analyst with New York-based Jefferies & Co. Inc.

It’s not clear how IPC will attempt to build on its Southern California acquisition. However, if its past strategy is any indication, the company will likely try to buy additional practices in the Riverside area before entering Los Angeles.

Also, IPC has stepped up its expansion into the subacute market, which includes rehabilitation hospitals and skilled nursing homes. Two of last year’s deals involved such practices.

Recent increases in Medicare reimbursement rates for medically complex cases give nursing homes more incentive to have top-flight physicians on call so they can admit those types of patients.

“With health care reform, providers are going to be held more accountable for an entire episode of care,” said Chief Executive Dr. Adam Singer. “So we want in our markets to be able to staff hospitalists in acute care and subacute facilities.”

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