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Published March 23, 2011, 01:10 PM

UPDATED: Dayton orders more disclosure from health plans

ST. PAUL — Gov. Mark Dayton is ordering competitive bidding and a new level of financial disclosure from Minnesota health plans as he seeks to save money on $3 billion worth of state contracts.

By: Associated Press, INFORUM

ST. PAUL — Gov. Mark Dayton toughened his stance toward health plans that manage care for subsidized health programs on Wednesday, ordering competitive bidding for state contracts and a new level of financial disclosure.

The Democratic governor directed state agencies to begin auditing the plans and produce a yearly report detailing their finances. His administration will also launch a website to showcase financial information about the plans, due to go live next week. The health plans do $3 billion worth of business with the state each year, managing care for more than 500,000 poor patients in MinnesotaCare and Medical Assistance.

Human Services Commissioner Lucinda Jesson wouldn't quantify how much she expects the state to save through competitive bidding on health plan contracts, but said it would be significant. She said in past years officials have renewed the contracts based on past business, but that will change for 2012 contracts with a new bidding process that kicks off this month.

"How much we can lower costs, I think the market will tell us," Jesson said in an interview. "But we haven't had the market in there before, so this really is a fundamental shift."

Minnesota's budget is running $5 billion short in the coming two years, with health and social services programs among the fastest-growing spending items.

Jesson is also pressing health plans to voluntarily return excess reserves to the state treasury after one plan, UCare, gave back $30 million on its own.