This case decision is a perfect example of how proper planning with a knowledgable Elder Law attorney can really help a family in need of long term care throught he Medicaid program. This federel decision regarding using annuities to protect community spouses is an excellent planning tool to be considered. However, keep in mind, different states can have some cavaets to the rules based on their own state regulations that work in conjuctioon wiht the federal law stated below. In any event, this was a great decision!
Author:Donna M. Stefans. Esq
Reversing a district court, a U.S. court of appeals holds that an annuity is an unavailable resource even if it is purchased in addition to the community spouse resource allowance, and that there is no transfer penalty for the couple’s purchase of the annuity prior to a determination of Medicaid eligibility. Morris v. Oklahoma Dept. of Human Services (10th Cir., No. 10-6241, July 9, 2012).
When Oklahoma resident Glenda Morris applied for Medicaid benefits, she and her husband, Leroy, had assets totaling $107,812. The state determined that Mr. Morris’ community spouse resource allowance (CSRA) would be $53,906 and that the couple would have to spend down $51,906 for Mrs. Morris to become eligible for Medicaid. The Morrises purchased burial plots as well as an irrevocable annuity for $41,000 that would provide income to Mr. Morris over a three-year period.
The state denied benefits, finding that Mrs. Morris could not spend her share of the couple’s resources on an annuity payable to Mr. Morris, or in the alternative, that Mrs. Morris was subject to a transfer penalty for transferring to Mr. Morris an amount above his CSRA. Read More
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