Missouri votes to block U.S. health insurance law

KANSAS CITY, Missouri (Reuters) - Missouri voters on Tuesday rejected the new U.S. healthcare bill, approving a measure that would forbid the federal government from penalizing people who do not buy health insurance.

With 78 percent of precincts reporting, 72.6 percent of voters supported the Health Care Freedom Act, also known as Proposition C, while 27.4 percent rejected it.

In approving the measure, Missouri won a victory in a series of planned assaults around the country against the sweeping reform, which was a major part of President Barack Obama's domestic agenda and became law in March.

The fight over the healthcare law -- and the individual mandate that requires individuals to have healthcare insurance -- is expected to be a major issue in the November congressional elections as Republicans plan to make repeal a major campaign theme against Democrats.

"Proposition C will be a boon to other states that are trying to repeal the individual mandate," said American Legislative Exchange Council task force director Christie Herrera. "Having that grassroots groundswell will give political courage to lawmakers."

The council helped draft the legislation in Missouri and in many other states.

The Missouri measure states that no rule or law can compel an individual or business to participate in any healthcare system, and prohibits laws that level penalties against people who do not buy health insurance.

Arizona and Oklahoma will have similar constitutional amendments on their November ballots to opt out of part or all of federal healthcare reforms.

MORE ACTION IN OTHER STATES

Similar initiatives are being pushed in several U.S. states by Republicans and groups who say the new healthcare law marks an unprecedented seizure of power by the federal government.

The effort was invigorated on Monday when a federal judge ruled that Virginia could proceed with a lawsuit that argues the federal requirement that its residents have health insurance is unconstitutional. Some 20 other states have made a similar legal challenge.

Experts said because federal law typically supersedes state laws, the state efforts could ultimately be largely symbolic, although it is likely the debate will make its way to the U.S. Supreme Court.

Ethan Rome, executive director of Health Care for America Now, which backs U.S. reform, said the measure in Missouri is more about Republicans trying to regain power than about healthcare.

"The Missouri vote is nothing more than a Republican straw poll with no legal force and it certainly isn't about healthcare," Rome said.

The federal penalty provision of the healthcare reform law does not take effect until 2014, and the Obama administration has said tax credits, subsidies and other measures will help those who cannot afford to buy insurance.

The passage of the Missouri measure angered the Missouri Hospital Association, which spent about $400,000 to try to defeat the act. The group warned voters that not requiring health insurance for all would continue to push healthcare costs higher as uninsured people tap resources.

"It will certainly be a matter for the courts to decide," said Missouri Hospital Association spokesman Dave Dillon. " But the message they send by their vote could be one that is costly to them."

(Reporting by Carey Gillam; Editing by Bill Trott)