Obamacare Will Penalize You if You Make “Too Much Money”

One of the main consequences of “taxing the rich,” especially when what is considered “rich” keeps getting lower and lower, is that it penalizes success. You can’t make “too much money,” or else you’ll have to pay more in taxes. So, it’s best if you just stay below “rich” tax bracket and not try to do any better.

Not surprisingly, Obamacare has the same effect. If you make more than 400% of the federal poverty limit (FPL), which varies by household size, even by $1, you will no longer be eligible for a government subsidy to purchase health insurance, and you’ll be on your own.


Household Size

400% FPL

Premium Cap

1 (Single)



2 (Couple)









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Under Obamacare’s rules, as long as you’re within 400% of the FPL, you won’t be required to pay more than 9.5% of your income toward health insurance. The subsidy will pick up the difference.

But as soon as you make just over 400% of the FPL, you’ll no longer be eligible for the subsidy, and you’ll have to pay the entire premium yourself, leaving you with less money by the end of the year, even though your income is higher.

Here’s an example taken from ValuePenguin.com:

 “The monthly premium for the silver policy for two 50 year olds living in Connecticut is $1,039, or $12,468 dollars annually. Under the ACA, if this couple makes under $62,040, they would benefit from having their premiums capped at $5,893, yielding a savings of $6,575 (subsidized federally). $62,040 – $5,893 = $56,147, post health insurance income. If this same couple earns more than the $62,040 amount, then they would lose the $6,575 of federal subsidies and find themselves that much worse off. In fact, this same couple would need to earn $68,615 to find themselves at the same take-home income post insurance that they had at $62,040.”

In effect, this will disincentivize people to be more successful, to work overtime or to get raises, for fear that they would end up with less money than they would have had, had they remained under their government mandated income threshold. Is there anyone that still believes Obamacare is about taking care of everyone and providing everyone with health insurance? It’s been about power and control from the beginning.

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