* U.S. appeals court says lower court correctly dismissed case
* Liberty University said mandates violated U.S. Constitution (Adds details from decision, case citation)
July 11 (Reuters) - A federal appeals court on Thursday rejected a Christian university's challenge to part of President Barack Obama's 2010 healthcare overhaul, which the school claimed improperly forced large employers to provide coverage to full-time workers, and forced taxpayers and employers to subsidize abortions.
By a 3-0 vote, the 4th U.S. Circuit Court of Appeals in Richmond, Virginia, rejected Liberty University's argument that requiring individuals to purchase minimum levels of health insurance coverage and many employers to offer such coverage violated the U.S. Constitution.
The court said Congress had a rational basis to find that the employer mandate substantially affected interstate commerce, giving it authority under the Commerce Clause of the U.S. Constitution to pass the law, known as "Obamacare."
It also said the law did not violate the constitutional right to free exercise of religion because it lets individuals and employers use healthcare plans that cover no abortion services except in cases of rape or incest or to protect the mother's life.
The court also said the law did not create an unconstitutional establishment of religion or denial of equal protection, saying the government took appropriate steps to accommodate religious practices while limiting interference with the law's purposes.
Mathew Staver, who argued on behalf of Liberty and is the dean of its law school, was not immediately available for comment. The U.S. Department of Justice also was not immediately available for comment.
Liberty, which was founded by U.S. evangelist Jerry Falwell in Lynchburg, Virginia, had filed its lawsuit shortly after Obama signed the healthcare law.
In 2011, the 4th Circuit dismissed Liberty's case, saying it lacked jurisdiction. In a 5-4 vote, the U.S. Supreme Court last year upheld most of the healthcare law and ordered the 4th Circuit to revisit the case in light of that decision.
Before the Supreme Court sent the case back, the Obama administration had said Liberty's lawsuit lacked merit but that it did not oppose letting the appeals court consider it.
The case is Liberty University Inc et al v. Lew et al, 4th U.S. Circuit Court of Appeals, No. 12-2347. (Reporting by Jonathan Stempel in New York; Editing by Paul Simao)