Using a Single Premium Immediate Annuity in Medicaid Planning (SPIA)

HNW Applying for Medicaid Long Term Care Benefits

MedicaidIs a SPIA appropriate for the Medicaid planning you may need?   There are requirements that an annuity has to meet for use in the Medicaid planning process if the intent is to prevent the income from the annuity from being a countable asset and excluded from mandatory spend down.  It is a complicated analysis.

Some single premium immediate annuities (SPIA) are eligible for use in Medicaid planning in New Jersey, however, a SPIA in Medicaid planning must be:

  • Irrevocable
  • Non-assignable
  • Actuarially sound

A SPIA must also designate the state Medicaid agency as a beneficiary and it customarily must provide for equal payments with no deferred payments or balloon payments.

How Does a SPIA Work in Medicaid Planning?

Moving a lump sum of countable assets into a SPIA may eliminate those assets from the nursing home resident or Medicaid applicant’s countable assets.  Not having countable assets above the asset limits, which are determined at the state level, may help make an individual eligible for Medicaid long term care benefits.

To discuss your NJ Medicaid matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at fniemann@hnlawfirm.com.  Please ask us about our video conferencing consultations if you are unable to come to our office.

By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold Township, Monmouth County, NJ Medicaid Attorney

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