A Via Meadia reader writes in about his experience with the Affordable Care Act. This reader lives in the Midwest and is in the midst of purchasing a family health insurance plan on the ACA exchange through an insurance broker:
When I first reported my income level to my insurance broker it excluded a three thousand dollar raise my boss is giving me. Today I called in and gave the updated salary that included the raise, and the broker re-ran the numbers. With the old quote at the lower salary level, my plan would include a $389 premium,a $1k family deductible, and a $2.5k family max out of pocket. At the new quote those numbers become a $424 premium, a $4k family deductible, and a $9k family max out of pocket. So by increasing my income by three grand, my costs would increase by ~$7k when you factor in premium increase + the new out of pocket max. Big picture, then, it’s in my interest to avoid increasing my salary above that threshold until I can increase it well over that threshold. But that isn’t really how pay raises work at most companies, so we have a law that—in certain cases at least— incentivizes keeping wages down.