The state's MinnesotaCare health insurance program is refunding $1.8 million to people who paid premiums after they were no longer covered.

The Minnesota Department of Human Services, which manages the health plan with 85,000 members, said Tuesday that 25,000 people continued to pay premiums online even though their cases had been closed.

The agency said it began notifying those affected by letter or phone this week. Most refunds are less than $250.

Refunds had not been issued earlier due to a problem with the agency's computer systems, DHS said. Ordinarily, when an individual's Minne­sotaCare coverage ends, the state automatically refunds any outstanding credit over $5 to the member after 65 days.

"We recently discovered a defect with the automatic refunds in some closed cases," DHS said in a statement.

The agency said it is advising people who paid their premiums online "to review their online payment setup and make adjustments as needed, which may include stopping the automatic payment if they no longer receive MinnesotaCare."

It added that it is now making monthly reviews to make sure that former enrollees are no longer paying.

MinnesotaCare covers state residents who make more than the income limits for Medical Assistance, the state insurance program for the poor, but generally cannot afford private coverage. A family of four can make up to $51,500 in order to qualify for MinnesotaCare.

MinnesotaCare premiums are based on a sliding-fee scale and top out at $80 per month.

"People who receive insurance through the state expect to trust the system, and I know a small unexpected expense can have a big impact on Minnesota families," said DHS Commissioner Jodi Harpstead.