Florida Medicaid Annuities - Pass The Asset Test

A single individual may have only $2,000 of countable assets in order to qualify for Medicaid. However, if the individual’s monthly income is less than $763, he/she can keep $5,000 of assets. In 2008 the community spouse may only have $104,400 of countable assets. Not all assets are counted, however. Examples of countable assets include: CD’s, savings accounts, checking accounts, bonds, stocks and money market accounts. Below is a list of assets that are “excluded assets”, that is they are not counted by Medicaid.

Major Asset Exclusions:

Homestead – If the spouse or certain dependent relatives continue to reside in the home, it is excluded. Also, if the applicant intends to return to the home, the home is excluded.

Vehicle – One vehicle of any age; a second vehicle if it is over seven years old (unless it’s a luxury model, antique or custom vehicle).

Life Insurance – If the total face value of all of the policies is equal to or less than $2500, then the cash value is excluded as an asset. If the total value exceeds $2500, the cash value is considered an asset.

Burial Funds and Prepaid Funeral Contracts – The full value of an irrevocable burial contract is excluded regardless of the amount. In addition, there is a $2500 exclusion for funds that have been designated for burial expenses. Oftentimes a new bank account can be opened for this purpose (e.g. John Doe Burial Account). In addition, one burial plot is allowed for each family member.

Personal/Household Goods – Personal items in the home such as home furnishings are excluded assets.

Retirement accounts - (e.g. IRA’s) are not counted as long as they are properly structured and the individual is taking regular income distributions from the account.

Properly Structured Immediate Annuities – assets placed into a properly structured “Florida Medicaid Friendly Annuities” are excluded assets. These Medicaid Annuities are frequently used tools to preserve assets for the family. Medicaid has several requirements that must be met in order for the assets placed into the annuities to be excluded. If the annuity is not structured properly, the family can tie up assets and then be declined for Medicaid. Therefore, it is imperative that a knowledgeable Medicaid practitioner be involved to structure the annuities properly.

Ongoing Business Concerns are excluded as assets since they generate income for the applicant that is ultimately contributed towards the cost of care as Patient Responsibility. Similarly, other real property that is rented or listed for sale is excluded.