In my kids' school, this "departmentalizing" happens in fifth grade, but not for the purpose of improving the quality of instruction in the "departments." It happens to give the kids some familiarity with the idea that different subjects will be taught by different teachers, and they will move from room to room for school, in preparation for middle school. The whole class moves together, and the kids get a lot of scaffolding on staying organized and remembering to go to their "lockers" (cubbies) to get the materials that they need for their next class.
Interestingly, the only subject for which students are grouped by ability is math, which is taught at the same time by all of the fifth grade teachers.
