Just one day after announcing an expansion into the consumer healthcare market, retail giant Wal-Mart has also announced it will be dropping health benefits for almost 30,000 of its employees.
Part-time employees who work on average less than 30 hours a week – about 2 percent of its current workforce – will no longer receive health insurance through Wal-Mart starting January 1st, 2015.
The reason? Simple: the nation's largest private employer can no longer afford it.
"It's more people signing up than expected in terms of their employees as a result of the rollout of the affordable care act."
Wal-Mart says it will be working with HealthCompare to advise its employees on what coverage to choose and to help them sign up.
Wal-Mart also announced insurance premiums for full-time employee's will rise by $3.50 but noted even with the increase their prices are 32 percent less than other retail employees.
Other retail employees have also had their healthcare benefits cut. Since the passing of Obamacare, Target, Trader Joe's and Home Depot have all cut healthcare benefits for part-time employees.
Many say this latest development was a long-time coming. Back in August, Wal-Mart's U.S. CEO announced the retailer was expecting to pay an extra $500 million this fiscal year just on healthcare.
Wal-Mart's announcement Tuesday served as a hint of good news for its share price, which for the last few months has been on the decline. Wal-Mart's share price jumped about 30 cents since the announcement.
This video includes images from Getty Images.
