When nursing home care is needed immediately but a costly spend-down is necessary to qualify for Medicaid long-term care benefits, a Medicaid-Compliant Annuity (MCA) might help avoid the spend-down by turning excess assets into an income-stream. We have found that MCA’s work well in Texas to preserve assets in IRA’s and retirement accounts that otherwise must be cashed-in and spent-down to qualify for Medicaid.
Although MCA’s are not the only way to re-characterize and preserve assets, they are particularly useful when only one of two spouses require long-term care. Excess resources can be converted to an income stream for the community spouse.
Each State is charged with administration of the Federal Medicaid rules and enforcing its own state-specific Medicaid policies and regulations. MCA’s have gained traction in Texas as a legal means to preserve life savings through a “Name on the Check” rule. This comes into play in determining the amount of income that must be paid to the nursing home and income available for benefit of the “community spouse.”
It’s never too early or too late to see us for help with long-term care planning that could include Medicaid eligibility and maximum asset protection.