The Health Insurance Exchange Board unanimously voted Thursday against actively negotiating with health insurance companies that want to offer their plans in the new virtual marketplace called the exchange.

The decision made health care advocates mad and satisfied health insurance companies who were against the idea of active purchasing.

As a compromise, the board agreed not to rule out the idea of negotiating price with the plans it will offer through an online portal starting in 2014.

That was “disappointing” to Ellen Andrews, executive director of the Connecticut Health Policy Project.

“They don’t inspire confidence,” Andrews said of the board after the four-hour meeting.

She said the board completely neglected to address the idea of affordability, which she argued is easily achieved through negotiations. Right now, small businesses and individuals purchasing health insurance in the open market have little or no ability to negotiate.

The exchange has the ability to negotiate and it passed, Andrews said.

The board also voted to increase the numbers of plans it offers, which Andrews and some members of the board said will only confuse consumers.

The staff of the Health Insurance Exchange recommended against negotiating with insurance carriers. It argued that the population of people coming into the virtual marketplace is unknown and the marketplace itself will take care of the competition.

Budget Secretary Ben Barnes, who also co-chairs the board, said underlying the argument about whether to negotiate is people’s lack of confidence in the market to get the best rate for the consumer.

He said the exchange makes significant changes and creates a whole different type of marketplace. He said it’s unclear at the moment exactly what the new marketplace will mean so he’s comfortable with studying it into the future.

State Healthcare Advocate Victoria Veltri was conflicted.

“My ideal position would be to negotiate out of the box, but as I said to everybody I’m not going to win that vote,” Veltri said.

Veltri doesn‘t buy the argument that the insurance carriers are ignorant when it comes to the risk associated with the population of people it would be covering.

“I do think the plans know what the population is coming in,” Veltri said.

But even if exchange was able to negotiate during the first year, the state law creating it requires that the insurance carriers go to the state Insurance Department for approval of the rates. So even if the exchange board negotiated a rate the Insurance Department could accept or reject it.

Andrews called the issue “laughable.” She said all the board needs to do is encourage the legislature to make a technical revision that cuts the Insurance Department out of the equation.

Veltri said she would have no problem seeking a technical clarification that allows insurance carriers to negotiate directly with the exchange.

“I think it ties the hands of the exchange of being an active purchaser by saying it has to go to the Insurance Department,” Veltri said.

If the state wants to allow the insurance carriers to innovate with plan design and delivery models, “why would we want to tie the hands of the exchange and not let it negotiate,“ Veltri wondered.

Health Exchange Board CEO Kevin Counihan said he thinks what the board passed Thursday gives it flexibility to see what changes need to be made to state laws if the exchange wants to negotiate.

“I think first we need to check the statute and see what kind of flexibility the exchange board has. Frankly, I don’t think that’s clear at all,” Counihan said.

He said the Insurance Department tells us not to worry about it because rate review is in their purview.

He expects the issue to be investigated and brought back to the board for discussion.

Meanwhile, Counihan was breathing a sigh of relief Thursday that the board decided more questions about the minimum requirements the insurance carriers have to meet to participate in the virtual marketplace.

“If we had missed this deadline it absolutely would have hurt our ability to meet the October 2013 deadline,” Counihan said.

By Oct. 2013, the state must have the virtual marketplace up and running so consumers can enroll before Jan. 1, 2014.