What is Medicaid Annuity?

There is no such thing as a Medicaid annuity. Annuities can however help some people shelter assets so that they can qualify for Medicaid long term care benefits. The reader is encouraged to consult an elder care attorney to understand the laws that apply in his state. Medicaid rules vary from state to state, so the following discussion is a general discussion of federal rules that impact the use of annuities for Medicaid planning. Some retirees have concern about paying for ill health (long term care) in later years. One strategy is to exhaust one’s assets and then qualify for Medicaid support. Understandably, most people are not eager to exhaust their assets. When it comes to counting your assets to determine Medicaid qualification for long term care benefits, properly structured annuities may be an exempt or non-countable asset and can be retained by the person who also gains Medicaid benefits. But that annuity must meet the following criteria: 1. It must be an immediate annuity or deferred annuity that is now being annuitized 2. The guaranteed payments must be for the life of the owner, or term certain shorter than the owner’s life expectancy Annuity agents often refer to annuities that meet the above [...]

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