Medicaid Annuity

A Medicaid annuity is a type of insurance contract that will guarantee a set income to the person that is insured. The individual will receive a lump sum of money over a period of time or all at one time. Most companies do not like the idea of giving them the lump sum of money at one set time. That is why they will try to work out a deal to give them a steady income for a year or however long it might take.

According to the rules set up by Medicaid you have to spend down the assets that you have. When you own an annuity it will be very beneficial to you. However, it is important to understand the rules and the benefits that it has to offer.

Flexibility

In most cases a Medicaid annuity might actually be a deferred annuity until you will need to get a certain amount of payments from the contract. When this process takes place the deferred annuity will be non reversible and it cannot be taken away from you. This is very helpful to those who need to use it for medical needs or to live off of. It also helps people to be able to qualify for Medicaid without having to dip into their savings.

Change of Ownership

It is possible, in certain cases, to transfer the ownership of the Medicaid annuity contract. This must be done at least five years before you are trying to get into a nursing home. This is because the Medicaid office will look back over the period of five years in order to know what assets to put into your total amounts of savings and income. They use this information to see how much Medicaid you will qualify for.