CHARLESTON — West Virginia’s health care program for public employees decided Thursday to end subsidies for retirees, starting next year with all new hires, and was promptly told to expect a lawsuit.

American Federation of Teachers-West Virginia President Judy Hale vowed to sue following the vote by the finance board for the Public Employees Insurance Agency.

“It’s one of the things that helps us recruit teachers, retain teachers,” said Hale, whose group continuously battles for pay raises, with mixed results. “It’s outrageous in light of teacher shortages ... We will settle this in court.”

Board members countered that the change puts West Virginia’s coverage more in line with that of other states. But Hale also questioned the board’s ability to cast such a vote during an emergency meeting. She further blamed Gov. Joe Manchin, seeing his fingerprints on the outcome.

“This appears to be a well-planned sneak attack on public employees by PEIA,” Hale later said in a statement.

A Manchin spokesman said the governor believes the board “did what they thought would be best for the state and its employees.”

“Certainly the governor is sympathetic with Judy’s concerns, and wishes there were an easier decision,” spokesman Matt Turner said. “Any time finances are involved, tough decisions have to be made.”

But other groups representing public employees said they are consulting lawyers over the move.

“I wouldn’t rule anything out,” said President Dale Lee of the West Virginia Education Association. “We will do everything we can to ensure that this benefit continues to be provided so that we can retain and attract the best and brightest to this profession.”

The board held the emergency meeting to respond to recent announcements from the private insurer now overseeing retiree coverage.

Maryland-based Coventry Health Care is increasing its monthly per-enrollee rate for handling Medicare Advantage by 37 percent, from $163 to $223, as of July 1. It also plans to stop managing such privately run portions of the government health program for seniors at the end of this year.

On a motion from member Joe Smith, the board voted to return the 35,000 affected retirees to PEIA’s main program after that, if it can’t find a new provider. That will put retirees on the same footing as they were in 2007, when PEIA launched Medicare Advantage.

But Smith’s proposal would also maintain the $22-per-month cut to retirees’ premiums that resulted from adopting Medicare Advantage. To cover the ensuing $28 million cost, PEIA will raid an already inadequate trust fund meant to provide non-pension benefits to future retirees. Health coverage accounts for much of these “other post-employment benefits” or OPEB, costs that such government programs must calculate and fund under recent federal accounting standards.

Smith argued it would be wrong to penalize retirees for an 11th hour business decision by Coventry.

“I do not think that the burden should be on the retirees for the expense,” he said.

Member Mike Smith then proposed ending the retiree subsidy for new hires. Retirees now pay 40 percent of their premium costs, with active enrollees shouldering the rest.

Neither vote was unanimous. Member Perry Bryant opposed both proposals, questioning their effect on enrollees.

But Turner and PEIA officials both predicted the subsidy’s end will gradually, and perhaps greatly, reduce the cost to the trust fund from future employees.

“In light of the OPEB situation we are facing, PEIA’s finance board has a fiduciary responsibility to address that liability, and they have taken this very seriously,” Turner said.

PEIA Director Ted Cheatham said the agency believes Medicare Advantage has saved $104 million. But Coventry and other insurers are exiting the market in advance of funding cuts by the Obama administration.

The White House estimates these privately managed Medicare programs cost about $1.30 for each dollar spent on traditional Medicare.

Cheatham also sought to interest board members in phased-in personal responsibility agreements for all PEIA enrollees, starting July 1.

Cheatham proposed linking premium breaks to blood screenings, advance end-of-life care directives, and ultimately enrollment in a preventive care-wellness plan. Board members said they needed more time to weigh that proposal and seek public comment.