PHOENIX, Nov 28 (Reuters) - Arizona Governor Jan Brewer said on Wednesday she was rejecting a major provision of President Barack Obama's healthcare reform law that calls for creating state-based health insurance markets where consumers can purchase private, federally subsidized coverage.

Citing lingering questions about the plan and operating costs she said would be passed on to families and small businesses, Brewer, a Republican, said Arizona would join at least 16 other states in op t ing instead for a federally run health insurance exchange.

Such networks are designed to function as online insurance markets where the uninsured can shop for private health plans offered at federally subsidized rates, and are an integral provision of the Affordable Care Act, a centerpiece of Obama's first term in office.

Brewer, along with many other Republicans, has been an outspoken critic of Obama's healthcare overhaul initiative, calling it an “overreaching and unaffordable assault on states' rights and individual liberty.”

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