CBO’s Obamacare predictions: How accurate?

CBO did better than the White House would have you believe.


So, was the Congressional Budget Office really “way, way off … in every aspect” of how it predicted that Obamacare would work, as the White House claims? No, it wasn’t.

The CBO actually nailed the overall impact of the law on the uninsured pretty closely. It predicted a big drop in the percentage of people under age 65 who would lack insurance, and that turned out to be the case. CBO projected that in 2016 that nonelderly rate would fall to 11 percent, and the latest figure put the actual rate at 10.3 percent.

It’s true (as Trump administration officials have repeatedly pointed out) that CBO greatly overestimated the number who would get government-subsidized coverage through the new insurance exchanges. But at the same time, CBO underestimated the number who would get coverage through expanding Medicaid.

And whatever the failings of CBO’s predictions, they were closer to the mark than those of the Obama administration and some other prominent forecasters.

Let’s look at the details.

Back on March 20, 2010, when the law had taken its final form and was working its way to President Obama’s desk, the CBO issued its official estimate of the cost and effects of the Affordable Care Act. And after the Supreme Court struck down a key part of that law – ruling that states could not be forced to expand eligibility for Medicaid – CBO updated its estimates accordingly in July 2012.

In what follows, we will cite CBO’s 2012 projections unless otherwise indicated, since we can never know how accurate the 2010 projections would have been had the law been allowed to take effect as written.


As it normally does, CBO attempted to forecast the law’s effects in each of the following 10 years. And here we compare what actually happened last year with what CBO predicted for 2016.

CBO got the big picture right. It predicted that millions of people would gain coverage, and millions did.

It predicted that the number of nonelderly (under age 65) people lacking insurance would drop to 30 million in 2016. And that turned out to be pretty close. The actual number was 27.9 million during the first nine months of last year, according to the latest figures from the Centers for Disease Control and Prevention’s National Health Interview Survey. That’s a decline of 20.3 million since 2010, by CDC’s reckoning.

In percentage terms, CBO predicted 89 percent of the nonelderly would be covered by last year. CDC put the actual percentage at 89.7 percent.


Where CBO had trouble was predicting the number of newly insured who would get their coverage by purchasing private insurance through the new exchanges set up by the law. CBO predicted that in 2016 there would be 23 million getting policies through the exchanges. The actual number was 10.4 million during the first half of the year, according to the Centers for Medicare & Medicaid Services.

That’s less than half the predicted total.


On the other hand, CBO was too low in its estimate of the number who would gain coverage through expansion of Medicaid, the state-federal program for low-income people and children.

CBO estimated 10 million would be added to the Medicaid rolls by 2016, even with many states refusing to expand eligibility. But that was too low. As of the first quarter of last year, 14.4 million adults had enrolled in Medicaid as a result of the Affordable Care Act’s expansion of the program, according to an analysis by the nonpartisan Kaiser Commission on Medicaid and the Uninsured.

So to a large extent, CBO’s mistake was in estimating where the uninsured would get covered, not how many of them would gain coverage.

Other estimates

In January 2016, the nonpartisan Commonwealth Fund published an analysis by New York University’s Sherry Glied of CBO’s forecast of the ACA’s effects. She called CBO’s predictions “reasonably accurate” compared with actual results in 2014.

The gap between CBO’s prediction and reality has widened now that 2016 figures are available for comparison. But Glied also found that CBO’s predictions were closer to 2014 reality than those of four other forecasters – the Obama administration’s own figures, and those of the RAND Corporation, the Urban Institute and the Lewin Group, a health industry consulting firm.

Glied concluded, “Given the likelihood of additional reforms to national health policy in future years, it is reassuring that, despite the many unforeseen factors surrounding the law’s rollout and participation in its reforms, the CBO’s forecast was reasonably accurate.”

And on March 13, CBO issued another, much-anticipated projection of the Obamacare repeal bill being considered by the Republican-controlled House. CBO estimated that under the GOP’s “American Health Care Act,” 14 million fewer people would have health insurance next year than under current law, and that number would rise to 24 million in 2026.

“In 2026, an estimated 52 million people would be uninsured, compared with 28 million who would lack insurance that year under current law,” CBO said.

Earlier on the day the analysis was published, White House Press Secretary Sean Spicer – who had been denigrating CBO’s work for days – said, “The last time they did this, they were wildly off and the number keeps declining.”

But as we’ve seen, CBO did better than the White House would have you believe.

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