Callie really did quit in a huff and is now an Attending at Mercy West. It's quite a surprise when her first patient is the Chief, who runs a red light when he's distracted about the meeting he's about to have with the board. There's a whole lot of meetings and whispering through the entire episode, but we'll wait to get to that. Interestingly, Richard has the gall to snap at Derek, who rightfully points out that he has had the Chief's back, but things are definitely tense between the two. He relieves himself of any possible tension, however, by having sex with Meredith anywhere and everywhere. It's her way of dealing with George's death since she hasn't cried -- it takes a janitor finally cleaning out his locker for her to break down in tears.

Alex and Izzie are having the opposite problem in that Alex won't touch his wife. They meet with a new doctor, because Izzie's cancer has subsided enough for her to no longer be interesting to Swender, which everyone assures her is a good thing. She'll continue treatment, but there is no real timeline -- they just wait and hope the cancer doesn't start to grow again. It doesn't do much to fix things between the two of them, so at the trailer Izzie finally demands Alex take off his pants and be her husband. He blows up about the matter of her DNR and her dying in his arms, and how he's angry and terrified of that ever happening again, but of course this means they can then make up.

Arizona sends her pain patient from the last episode to Mercy West with a message to get Callie to run the expensive test that Richard forbade. It still doesn't really help, so she goes to Derek; wonder surgeon that he is, he figures out what's wrong and they're able to help free the kid from a life of chronic pain. Between these scenes and the one with Richard at Mercy West earlier, we also pick up that they are having as much budget trouble there as they are at Seattle Grace. What on earth could that mean down the line, do we think?

Lexie is trying to help out her amputation patient, Clara, but Clara is refusing physical therapy and sinking further and further into depression. Hunt finally tells Lexie that she'll have to have Clara committed, which freaks Lexie out enough to yell at her patient that the doctors are referring to her as "ceviche" -- chopped fish. Clara finds this so funny that she bursts out laughing and winds up both doing physical therapy and letting Lexie call her mom in England and tell her about the accident. Lexie is then so moved that she stops balking at the idea of living with Mark and shows up with a toothbrush and a gigantic suitcase in tow, much to his delight. It's just like Friends now, with Mark and Lexie across the hall from Cristina and Callie!

Speaking of Cristina, she goes to a therapy session with Hunt in an effort to show how close they are and therefore, why they should be having sex. It's all stilted and weird and Dr. Amy points out that they don't talk at all about the war or Owen's choking her and until then, they won't be able to actually help fix the problem. Some joking at a later session finally turns into a conversation about the Incident, and afterward it seems they've decided that they have been honest enough that they can have sex again. I imagine she's still going to keep from ever putting a ceiling fan up again, though.

Last but not least, after seeing her storming around for weeks on end like an angry robot, Derek forces Bailey to talk about what's going on. She admits that she's too attached and emotional about her group of former interns and that she needs to stop giving away her feelings and keep them for her son. It's horrible and depressing, but Derek accepts her will and then lets them continue on in the elevator.

So with everyone finally coming to terms with things nearly 40 days after George's death, the Chief gathers the staff together for an announcement: Seattle Grace and Mercy West are going to be merging, and there are definitely going to be staff cuts. It's time to let the real fun begin!