Annuities & Medicaid

An immediate annuity provides a mechanism to qualify a person immediately for Medicaid benefits if the person is single and has assets over $2,000.   If the applicant is married, and the couple has assets over the community spouse resource allowance of $109,560, the annuity payment may be shifted to the well spouse.  The immediate annuity legally converts countable assets to a non-countable asset which generates an income stream to either the applicant or the applicant's spouse.

The annuity must follow certain requirements and must not be for more than the life expectancy of the applicant.  You should only deal with a firm that is adept at reviewing such annuities and assuring that such a tool will in fact meet Medicaid guidelines. Unfortunately, many people experience annuity salespeople who are unfamiliar with the Medicaid rules and how they relate the Medicaid qualification.  In addition, annuities are not for everyone and must be analyzed to see if it is appropriate in your particular situation.

The immediate annuity can be a great tool to qualify an individual for Medicaid; however, there are many factors that should be considered and discussed with your attorney:

• The immediate annuity from Senior Management Group must follow specific Medicaid guidelines in order for it to be considered an exempt asset.  Some of these requirements include:   

• The annuity must be immediate and irrevocable,

• The annuity must be actuarially sound and must be for a term less than the annuitant's life expectancy (as determined under Medicaid Tables),

• The annuity must be nonassignable,

• For a single person, the income generated by the annuity will be required to be paid to the nursing home.

• For a married couple should be established with the well-spouse as the annuitant.  The income generated will not count towards the applicant's Medicaid eligibility, but may impact the well-spouse's Minimum Monthly Maintenance Income Allowance.

• The income generated may be taxable to some extent.

• You lose the accessibility to the underlying principal.

• There is no adjustment for inflation or interest changes.

• Other factors should be discussed with your attorney as to the underlying law governing inclusion/exclusion, as well as the impact of Florida's Medicaid Estate Recovery program.

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Disclaimer: The information provided on FloridaMedicaid.com is not intended to be legal advice, but merely conveys general information related to legal issues commonly encountered. Your access to and use of this website is subject to additional Terms and Conditions. © 2005 Senior Management Group, LLC. All rights reserved.  Senior Management Group, LLC does not offer legal referrals (as defined in State Bar of Florida Pertaining to Lawyer Referral Services).