Number Games: “The latest cost estimate is 15% lower than the prior estimate”

Say, what?

During last Thursday’s impromptu press conference, President Obama ballyhooed that the OC Exchanges had passed 8 million sign-ups (whatever the heck a “sign-up” is) … and that the CBO’s “latest estimate” says the ObamaCare “costs are down 15% from the prior estimate”.

Oh, really?

My BS detector auto-starts when I hear well-parsed, weasely words like those.

Wonder when the latest estimate was made?  What were the assumptions?  How does it tie to the miracle of 8 million?

 

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So, I took  a  moment to dissect that statement … the digging didn’t disappoint

For a long while the CBO had been projecting that the OC Exchanges would get about 7 million enrollees.

Then, after the web site fiasco and before the Two Ferns blockbuster promo,  the CBO revised it’s official estimate down 14.2% to 6 million … and scaled costs accordingly.

That is, they took their costs estimates down about 15%.

Turns out that was the “last official estimate”, so Obama was technically telling the truth: latest estimate is 15% less than the prior estimate.

Here’s what the President didn’t say:

The CBO hadn’t officially re-upped their estimates to 7 million sign-ups… or, the new-news 8 million.

When they do, their cost estimates are likely to go up 25% or more from the costs associated with the 6 million base in the “last official forecast” (a 2 million increase is 33% more than than the 6 million “active” baseline).

I don’t know if these jabrones spew these misleading numbers because they are bad at math … or because they are masters of illusion.

My money’s on the latter …

The teaching point: When you’re comparing 2 numbers, always know specifically what 2 numbers you’re comparing … and what assumptions underlie them.

#HomaFiles

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