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Budget delay prompts cola for CalWORKS; payment problem for hospitals

While everyone is waiting for Senate Republicans to release their list of proposed savings, the absence of a budget is playing funny tricks on state welfare and health care supplements.

Without an on-time budget, the state's welfare-to-work program automatically kicked in a cost-of-living adjustment to all 465,000 CalWORKS recipients, costing the state $10.1 million in July, according to the Department of Finance. For a family of three receiving the maximum $723, that's an additional $25.

CalWORKS recipients, however, shouldn't get used to the boost.

The budget passed by the Assembly and now sitting before the Senate proposes to suspend the annual increase for a $123.6 million savings based on a 3.7 percent increase. Either way the state is out $10.1 million because of the delay.

And starting Aug. 2, Medi-Cal, the state's public insurance program for the poor, will have exhausted its funding for the year, which means California won't be able to make reimbursements to hospitals and clinics. That's worth $227.2 million in payments, of which $113.6 comes from the general fund.

The reason? "Because there's no budget in place," says finance spokesman H.D. Palmer, citing arcane government codes.

Only practitioners - doctors, nurses and pharmacists - will receive reimbursement under a court decision.