68 Match 5 Mega Millions winners but the 21 in California get low pari-mutuel payouts

What seems to be a record number of the 2nd place Mega Millions winners in the March 20, 2012 drawing illustrates two important lottery oddities.

First, we find that a total there was a total of 68 winners who matched the 5 white balls and won the second tier prize. The white ball numbers drawn were: 01 04 06 11 14. These are classified as "Birthday" numbers because they can all be made from the numbers of the month and the day of month.

In choosing numbers to play, many people use important dates as their numbers.  While we do not know if the majority of winners picked their own numbers, we suspect that they did. This would certainly account for the large amount of winners. However, if most of the winning tickets were generated as Quick Picks, we would have to question the random number generator being used. Most likely though, most of the winners  played their favorite numbers and not quick picks.

Looking at the increase in the annuity jackpot prize by $49 million, we can also estimate that there were approximately 98 to 100 million tickets were sold. Given that number, we would expect to have 25 to 26 match 5 winners. But, since we have 2.6 times that amount, the Birthday Number Theory provides a sound explanation.

The low prize payout to the 21 California winners highlights the second oddity which is because of pari-mutuel payouts in that State. Normally, a Mega Millions match 5 winner without the Megaplier Option would receive $250,000.  But, California pays out the Mega Millions prizes on a pari-mutuel basis (not a fixed prize level). This means that the payout fluctuates depending on the number of winners. The fewer the winners, the higher the prize; and, the more the winners, the lower the prize.

Because of this, the California winners will receive $56,382 each, almost 5 times less than the 47 winners in the other States.  

When multiplying the $56K times the 21 winners, it appears that California expected to see 4 to 5 winners in this tier that would have won $250,000. But because there were 21 winners, they all had to share the allocated prize amount equally which substantially reduced their earnings.

We can learn 2 things from these results:

• First, many people play their birthday numbers which are often duplicates,
• Second, try not to buy tickets in California if you live on a border state where the payouts are fixed.

Lastly, we wish to congratulate all of last night's Mega Millions winners on a job well done!