This is the Cato Daily Podcast for Friday, June 12, 2015.

I'm Caleb Brown.

For potentially millions of families, the decision to make more money or less money or

get married or stay single may be significantly affected by the

structure of the Affordable Care Act. For some families earning a single

dollar more per year can mean thousands of dollars in foregone Obamacare subsidies.

Aaron Yellowitz, an adjunct scholar at the Cato Institute has crunched some of the numbers

on these so-called Obamacare earnings cliffs.

The rollout of the exchanges in 2014 created a crazy patchwork of incentives to increase or

decrease one's earnings in order to qualify for what's known as the premium tax credit.

The premium tax credit limits the amount that you pay out of your own pocket for health insurance

premiums when you purchase it on the exchange. So I go to an exchange and I take a

look and based on my income and based on other characteristics whether I'm a smoker, whether I'm not and where I live I get a quote that is a number that includes some amount of federal subsidy.

You get a quote that includes an amount of federal subsidy and if you go on to the health care.gov website, what you'll see is that as your

income changes ever so slightly at times the premium tax credit changes not so slightly.

This is known as the Obamacare earnings cliff.

Let me give two important examples.

In states that didn't expand Medicaid, if your income

moves up to 100% of the poverty line, you instantaneously get a much, much larger subsidy which creates incentives

to increase your income at least to that threshold.

On the other hand, in all 50 states in DC, if your income goes above 400% of the federal poverty line,

then you potentially lose a very large amount of subsidy by earning an extra dollar.

...