Earning just one dollar more could mean a $10,000 increase in insurance premiums.
https://www.nytimes.com/2026/01/30/upshot/obamacare-subsidies-financial-cliff.html
Why was the Affordable Care Act created with a cliff back in 2009? The policy achieved a few important goals for the legislators who wrote it. It limited the total cost of the legislation — an important constraint imposed by the Obama White House. And it insulated Democrats from attacks that they were handing out tax credits to wealthy Americans.
In the early years of Obamacare, the cliff meant a cost increase of a few thousand dollars a year for a typical 60-year-old, though prices varied around the country. Younger Americans, whose insurance tends to be cheaper, often experienced even smaller differences. (The numbers in our charts above illustrate incomes and subsidies for a 60-year-old living in the contiguous United States.)
Dan Sacks, an associate professor of risk and insurance at the University of Wisconsin-Madison, described the difference at the time as more of a “kink” than a “cliff.”
“The expectation was that this would not be a hard cutoff for many people,” he said.
In the years since, as insurance costs have risen faster than incomes, that cliff has gotten taller.