What is a Medicaid Friendly Annuity and how it is used to preserve assets?
A Medicaid Friendly Annuity is an insurance product which has been used for well over 10 years to preserve assets prior to applying for Medicaid Planning. Thus life insurance agents have been integrally involved in Medicaid Planning for well over 10 years. While many life agents have chosen to specialize in this arena, MIR is one such agency which focuses solely on Medicaid Planning. The Deficit Reduction Act of 2005 has placed some limitations on the use of these annuities. However, these Medicaid Planning Annuities are still in use today for Spousal Cases here in Florida. Typically, excess assets above allowable limits are placed into the annuity and then it gets annuitized thereby creating an income stream for a fixed period of time. Once annuitized, the asset is gone and the individual receives a guaranteed income stream each month for a set number of years. Thus, the Medicaid Friendly Annuity is a way to “make the asset go away” without losing the financial benefit of the asset. U
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