So now making 231k makes you worse off than someone making 230k? Why even have that threshold when it doesn't even exclude that many people, it just causes weird incentives.
The article also mentions a 50% subsidy up to $310,000. The details aren’t spelled out, but subsidies like this often phase out gradually to avoid a cliff at the threshold.
Stepwise phaseouts often create more cliffs rather than avoiding cliffs. It is possible to do continuous phase out without cliffs (with or without bend points), the easiest way being to simply give a flat, income-insensitive benefit based on non-income qualifications, and then do the clawback through increases to marginal income tax rates, but if you are committed to clawback internal to the program you can do it through a fixed or tiered marginal clawback rate, instead of having a single or tiered set of benefit cliffs. But programs rarely do that, for a variety of reasons.
You make it sound like a problem, but if you can make 311k, I'd say it shouldn't too hard to make 310k instead if that's better for you? Unless some companies have minimum salaries that high?
Probably because in order to get it passed they had to have some cutoff because there was some people who would argue against it being free for everyone.