More than 2,000 hospitals have signed onto a public-private effort to reduce hospital-acquired conditions, federal officials said Friday, meeting the Obama administration's goal.

The Department of Health and Human Services launched the Partnership for Patients in April, touting it as a way to save 60,000 lives and $35 billion over three years by reducing medical errors by 40 percent. The partnership aims to encourage collaboration between hospitals, medical professionals, insurers, employers and patients so that best practices can be learned and shared.

"This level of participation, this early, is evidence of the strong support across the country for strengthening American healthcare for future generations by improving it; not cutting it as some have proposed to do," HHS Secretary Kathleen Sebelius said on a conference call with medical providers, state officials and patient advocates. "At a time when Medicare costs are expected to rise steeply over the next decade — and given that we lose billions to waste, harm, and error in care — every partner in this program has committed to working together to build a better, safer, more reliable health care system for all."

The administration has two sources of funding for the partnership, both created by the healthcare reform law. The Community-Based Care Transitions Program provides $500 million for community-based organizations to help patients transition out of the hospital, and the Medicare agency's Innovation Center has posted a request for bids for state, regional, national or hospital system organizations to manage improvement projects that affiliated hospitals are able to join.

The Department of Health and Human Services (HHS) announced new efforts Friday to help states cut Medicaid spending.

The initiatives are targeted at better coordinating care for people who are eligible for both Medicare and Medicaid. They represent some of the sickest — and most expensive — patients in the country.

HHS said it will begin sharing with states any savings from more efficient care of dual-eligibles. The department will test two models for shared savings.

"States that want to take on Medicaid costs now have an incredible toolbox,” HHS Secretary Kathleen Sebelius said on a conference call with reporters.

Washington Gov. Christine Gregoire (D) praised the announcement, saying Sebelius has moved with "lightning speed" to address governors' concerns over Medicaid spending.

HHS also launched an initiative to reduce hospital admissions among patients in nursing homes. Medicare could save as much as $2.6 billion per year by eliminating unnecessary hospital visits by dual-eligibles in nursing homes, HHS said.

Washington Gov. Christine Gregoire (D) said states could have a "huge problem" with President Obama's proposal to "blend" Medicaid costs.

Critics of proposed restrictions on food marketing to children have found a new hook: jobs.

A food industry front group unveiled a new report Friday that concludes that the government's proposed restrictions on food marketing, aimed at curbing childhood obesity, could cause 74,000 Americans to lose their jobs. The report comes the same day the White House is reeling from news that the unemployment rate rose to 9.2 percent last month.

"The last thing American families and the U.S. economy needs is more jobs at risk from misguided government action," Dan Jaffe, a spokesman for the Sensible Food Policy Coalition, said in a statement. "These advertising restrictions will put thousands of good-paying jobs at risk without demonstrably coming any closer to helping solve the serious obesity problem in the United States."

Republicans want to know whether the Supreme Court justice helped develop a legal defense of the law for President Obama.

The Lexington Herald-Leader details Kentucky's move to Medicaid managed care.

Rate-review legislation continues to advance in California. It passed the state Senate on Thursday. California Healthline has the story.

The chief executive of the country's largest municipal hospital system sees a "clear downside" to healthcare reform, Kaiser Health News reports.

Medicaid advocates are increasingly confident that a GOP proposal to overhaul the program is off the table.

No comprehensive overnights this week, but here's a short roundup of health news that didn't make the blog.

Kagan ties to health law probed: The House Judiciary Committee is probing Supreme Court Justice Elena Kagan's involvement in the healthcare reform law when she was President Obama's solicitor general. Federal law prohibits justices from judging cases if they served as counsel or adviser on the case or expressed an opinion about its merits while in previous government service.

Runaway wheelchairs: Sixty-one percent of power wheelchairs provided to Medicare beneficiaries in the first half of 2007 were medically unnecessary or didn't have enough documentation to justify their need, says a new government audit. Power wheelchairs cost Medicare $95 million during that period.

Disease mongering: Abbott is under fire for hyping the health impacts of insomnia in order to sell sleeping pills in India.

Pacemaker coverage: Medicare is expanding MRI coverage to beneficiaries with implanted pacemakers.

Obesity rates in the U.S. are skyrocketing alongside growth in obesity-related illnesses like diabetes, according to a report released Thursday.

The study recommends restoring funding to government anti-obesity programs and drawing from the healthcare reform law's prevention fund, which Republicans have proposed cutting.

Roughly two-thirds of adults, and one-third of children, are overweight or obese, according to the study from the Trust for America's Health and the Robert Wood Johnson Foundation. It found that obesity is growing especially fast in certain parts of the country, particularly the South.