Medicaid Annuities--Government Help If You Qualify

You probably already know that nursing home costs average more than $66,000 per year, and Medicare only covers short periods of skilled care after you are released from a hospital.  And maybe you have purchased a long-term care insurance policy to help pay for such an expense. But do you realize that that may not be enough to protect your spouse (community spouse) who is still at home and that there may be a way for you to receive additional government assistance?

Almost 70 percent of nursing home residents receive help from Medicaid. This program is funded and regulated by the federal and state governments and will pay the portion of your nursing home expenses that your income and long-term care policy don’t cover.

The eligibility requirements vary from state to state so it’s important for you to understand your state’s rules on spousal protection.
Medicaid will provide funds for care before insisting you exhaust all of your personal assets and income. Most states will let your spouse keep between $1,451 per month and the federal limit of $2,175. And he or she will also be able to keep between $17,400 and $87,000 that represents half of your combined assets not including your home and some other assets. Anything over that amount can be attached to pay for your care. As a result you might have to “spend down” to your state’s definition of “needy” in order to get assistance, which could leave the community spouse in financial difficulty. Then when you get out of the nursing home, you could be left without those assets that you had previously used to supplement your income (there are many ways, however, to shelter your assets). 

Each state has specific guidelines of what are considered attachable assets. These generally include CDs, IRAs, money market accounts, and deferred annuities. However, an immediate annuity, the kind that starts paying an income immediately, is usually not attachable provided certain requirements are met:

·   It must be irrevocable

·   It must be based on your life expectancy

·   Payments must begin prior to you entering a nursing home

If you would like to learn how an immediate annuity could possibly help you qualify for Medicaid, preserve assets, and provide an income for your spouse, find an advisor trained with various types of annuities and who can provide advice in your local area, click here

Note that immediate annuity investments contain fees and expenses and may not be able to be surrendered for value.