A. Each covered employee shall continue to be a state employee who is governed by and eligible to participate in the human resources and benefits programs that governed him and in which he was eligible to participate immediately prior to the effective date of the initial management agreement for the covered institution by which he is employed, including the state retirement system, state health insurance program, state workers’ compensation coverage program, and state grievance procedure, until the covered institution establishes a human resources program or programs, plan, or procedure applicable to him pursuant to this article in any such human resources or benefits program area. If, however, a covered institution is permitted by law other than in this chapter to establish an alternative health insurance plan or an alternative faculty or University of Virginia Medical Center retirement plan, such alternative health insurance or faculty or University of Virginia Medical Center retirement plan shall apply to and govern the covered employees included in such plan.