ST. PAUL, Minn. (AP) — State officials say they’ve saved nearly $650 million by tweaking its subsidized health care programs.

Minnesota contracts with health plans to cover low-income residents in public programs like MinnesotaCare and Medical Assistance, which is Minnesota’s version of Medicaid. Department of Human Services Commissioner Lucinda Jesson announced Tuesday that the state saved about $450 million by putting those contracts up for competitive bidding.

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The state is also getting a $200 million windfall from health plans because new enrollees in those programs were healthier than the plans expected. That means they cost less to cover.

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Some of the extra cash needs to go to the federal government. But the state’s $250 million share will beef up an expected budget surplus that lawmakers hope to tap for tax cuts and transportation fixes.

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