The need for some customers to protect assets from Medicaid spend down is obvious. It may be due to the needs of the spouse, a child disability or a myriad of good solid reasons. This is where the medicaid planning advisor is responsible to the rescue. Most medicaid planning advisor know that certain types of annuities can avoid passing down and can provide protection for the assets of the annuity. These annuities have specific language to make them fully qualified under the rules for Medicaid. Most annuity contracts do not contain the language of the rules to qualify for Medicaid. Personal responsibility comes into play when an agent does not understand the rules or the process that must be met to qualify the fund. An agent will sell “just an annuity,” explaining to the client funds are safe to go down.
You may wonder why this happens. The reason is obvious, important commissions. Commissions for Medicaid through annuities are often very low, while commissions for a standard annuity are generally much higher.
Planning Medicaid using annuities is a good idea.
Medicaid planning with annuities refers to the organization or transfers your assets to prevent or minimize their use by Medicaid, if they pay for your long-term care. This explains how you can shelter some of your assets with medicaid planning with annuities for you or your spouse have Medicaid pay for your costs. Medicaid long term care costs will pay for nursing home care, but it does only for those who are poor. Since Medicaid is a combined state and federal program, each state defines how little of your assets before Medicaid must pick your nursing costs.
An annuity is a regular flow of payments to you in exchange for a lump sum of money. They can be either private (between you and a family member) or commercial (made with an insurance company). Medicaid does annuities. As commercial you can see, using the entire amount of surplus funds to purchase an annuity for Medicaid for one individual makes little sense. However, to be sure, you should simply “run the numbers”: how much money is there to invest in the annuity? What is the expected life expectancy of the resident? Once you know these factors, you can try different scenarios and see whether it makes sense to purchase the annuity.
Ensure that your annuity is Medicaid complaint.
Medicaid compliant annuity agency to recover residual benefits.In general, after the Act of 2005 deficit reduction, if one spouse uses community Medicaid compliant annuity or promissory note, eliminate the amount spent below an institutionalized spouse is immediately eligible for Medicaid benefits. After purchase of Medicaid compliant annuities, if the community spouse’s income is less than the monthly maintenance needs allowance shortfall would be moved from its income or institutionalized spouse before determining the share of Medicaid. Thus, maximizing the life of the annuity to the extent the results of Medicaid compliant annuities community spouse’s life expectancy during the income planning. The only drawback of a stretch to maximize is that if the spouse dies before the term community, leaving an opportunity for the state
