Wal-Mart Stores Inc , the biggest private sector employer in the United States, said on Tuesday it would no longer provide health benefits to some of its U.S. part-time workers due to ballooning healthcare costs.

The company it would stop health benefits for part-time employees who work less than 30 hours a week. The move is expected to impact about 2 percent of the company’s workforce, Wal-Mart said in a blog post.

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Coverage will be discontinued from Jan. 1, 2015. That’s when the Affordable Care Act – popularly known as Obamacare – will require all companies employing 50 or more people to offer health insurance to those working at least 30 hours a week.

Providing health plans to employees working less than 30 hours may disqualify them from income-based government subsidies offered on insurance exchanges.

“Like every company, Wal-Mart continues to face rising health care costs,” Sally Welborn, the company’s senior vice president of global benefits, wrote in the post.

“This year, the expenses were significant and led us to make some tough decisions as we begin our annual enrollment,” she said.

Wal-Mart, which has 1.3 million employees in the United States, cut its full-year profit forecast in August, citing higher employee benefit costs, among other things.

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The company said then that it expected to spend $500 million on U.S. healthcare this year, up from $330 million estimated in February, as enrollments and medical costs rise.

Welborn said in a conference call that Wal-Mart had not yet estimated how much it would save by cutting benefits.

Employee healthcare costs have risen for companies since the passing of the healthcare reform bill.

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As a result, many companies are moving employees onto public or privately run online exchanges for their medical coverage.

Target Corp said in January that it would stop offering health coverage to part-time workers, while Home Depot Inc said in September last year that it would shift coverage for part-time workers to public exchanges.

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Wal-Mart said on Tuesday it would increase premiums for all of its U.S. employees in 2015.

Premiums will increase by $3.50, to $21.90 per pay period for the most popular and lowest-cost employee-only plans.

The company said it was changing some eligibility terms for part-time employees working more than 30 hours a week, but did not provide details.

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For eligible workers – both full and part-time – the company said it would continue to provide options that include no lifetime maximum, preventative care covered at 100 percent, and up to $1,000 to help pay for medical expenses.

Wal-Mart’s shares were little changed at $77.40 in early afternoon trading on the New York Stock Exchange.

(Reporting by Siddharth Cavale in Bangalore; Editing by Ted Kerr)