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PHOENIX (Reuters) - Arizona Governor Jan Brewer, an ardent critic of President Barack Obama's push to overhaul the U.S. healthcare system, said on Wednesday she was rejecting a new federal mandate to set up a state-based health insurance exchange under the U.S. Affordable Care Act.

Citing lingering unanswered questions about the exchanges and concerns about high costs she said would be passed on to Arizona families and small businesses, Brewer, a Republican, said her state would opt instead for a federally run exchange.

Such networks are designed to function as online insurance markets where consumers can shop for private coverage at federally subsidized rates, and are an integral provision of the act, a centerpiece of Obama's first term in office.

Under a newly extended deadline, states have until December 14 to notify the U.S. Health and Human Services Department whether they intend to comply with the insurance exchange mandate or leave it to the federal government to set up and operate exchanges for them.

About 17 states have told the Obama administration they plan to move ahead on their own exchanges, while at least nine Republican governors in recent days have rejected the plan outright, as Brewer has, or opted to cooperate with Washington in setting up a hybrid federal-state network.

"My opposition to the Affordable Care Act is unwavering, as is my belief that it should be repealed and replaced," Brewer said in a statement announcing her decision.

(Reporting by David Schwartz; Writing by Steve Gorman; Editing by Cynthia Johnston)

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