(a) Upon receipt of a letter that indicates likely federal approval that the director determines is sufficient for implementation under Section 14169.63, or upon the receipt of federal approval, the following shall occur:

1. (1) To the maximum extent possible, and consistent with the availability of funds in the fund, the department shall make all of the payments under Sections 14169.54, 14169.55, and 14169.56, including, but not limited to, supplemental payments and increased capitation payments, prior to the end of a program period, except that the increased capitation payments under Section 14169.56 shall not be made until federal approval is obtained for these payments.
2. (2) The department shall make supplemental payments to hospitals under this article consistent with the timeframe described in Section 14169.66 or a modified timeline developed pursuant to Section 14169.64.