Washington Administrative Code
Title 182 - Health Care Authority
WASHINGTON APPLE HEALTH
Chapter 182-516 - Trusts, annuities, life estates, and promissory notes-Effect on medical programs
Section 182-516-0201 - Annuities established on or after April 1, 2009
Universal Citation: WA Admin Code 182-516-0201
Current through Register Vol. 24-18, September 15, 2024
(1) The medicaid agency or the agency's designee determines how an annuity, purchased by or on behalf of an annuitant and established on or after April 1, 2009, affects eligibility for medicaid.
(2) General information.
(a) Clients of noninstitutional medicaid must
disclose to the agency or the agency's designee any interest that client, or
the financially responsible members of that client's assistance unit, has in an
annuity.
(b) Clients of
institutional or home and community-based (HCB) waiver services must disclose
to the agency or the agency's designee any interest that client, or that
client's community spouse, has in an annuity.
(c) Subject to (d) of this subsection, this
section applies when the annuitant is:
(i)
The client of medicaid;
(ii) That
client's spouse, if that spouse is financially responsible for that client;
or
(iii) That client's community
spouse.
(d) If this
section does not apply because of (c) of this subsection, but the client of
institutional or HCB waiver services, or that client's community spouse, is the
owner of the annuity, then the purchase of the annuity is evaluated as an asset
transfer under WAC
182-513-1363.
(e) For the definition of "disabled," see WAC
182-512-0050(1)(b)
and (c).
(f) Actuarial life expectancy in this section
is rounded up to the nearest whole year.
(3) Annuities as resources.
(a) Subject to (b) of this subsection, a
revocable annuity is an available resource.
(b) The following annuities are not available
resources, even if revocable:
(i) An annuity
described under 26 U.S.C. Sec. 408 (b) or (q); or
(ii) An annuity purchased with proceeds from:
(A) An account or trust described under 26
U.S.C. Sec. 408 (a), (c), or (p);
(B) A simplified employee pension (within the
meaning of 26 U.S.C. Sec. 408(k)); or
(C) A Roth IRA described under 26 U.S.C. Sec.
408A.
(c) An
annuity not described under (b) of this subsection is an available resource
unless the annuity:
(i) Is issued by an
entity licensed and approved to issue annuities in the jurisdiction in which
the annuity is established;
(ii) Is
immediate, irrevocable, nonassignable; and
(iii) Is paid out, in equal monthly amounts
with no deferral and no balloon payments, over a term:
(A) Of at least five years, if the actuarial
life expectancy of the annuitant is at least five years; or
(B) Not less than the actuarial life
expectancy of the annuitant, if the actuarial life expectancy of the annuitant
is less than five years.
(d) If an annuity fails either the immediate
requirement under (c)(ii) of this subsection or the monthly payout requirement
under (c)(iii) of this subsection, the annuity is not a resource if:
(i) The annuity is fully paid out within the
actuarial life expectancy of the annuitant; and
(ii) The annuitant:
(A) Changes the scheduled payout to equal
monthly payments; or
(B) Asks the
agency or the agency's designee to calculate and budget the periodic payments
as equal monthly payments beginning the month of eligibility. Periodic payments
made before the month of eligibility are not included in the
calculation.
(iii)
Nothing under (d) of this subsection affects the deferral or balloon payment
requirements under (c)(iii) of this subsection, or the payment term
requirements under (c)(iii)(A) or (B) of this subsection.
(4) Annuities as income.
(a) If an annuity is not an available
resource under subsection (3) of this section, the payments from the annuity
are unearned income to the annuitant.
(b) If an annuity is an available resource
under subsection (3) of this section, the payments from the annuity are not
income to the annuitant.
(5) An annuity as a transfer of assets.
(a) The purchase of an annuity is an
uncompensated asset transfer, unless the annuity designates the state of
Washington as remainder beneficiary under subsection (6) of this
section.
(b) The purchase of an
annuity by the client of institutional or HCB waiver services is an
uncompensated asset transfer, unless the annuity is an annuity under subsection
(3)(b)(i) or (ii) of this section, or the annuity:
(i) Is issued by an entity licensed and
approved to issue annuities in the jurisdiction in which the annuity is
established;
(ii) Is immediate,
irrevocable, nonassignable; and
(iii) Is paid out, in equal periodic amounts
with no deferral and no balloon payments, over a term that is actuarially sound
(i.e., a term that is not greater than the actuarial life expectancy of that
client).
(6) Beneficiary designation requirements.
(a)
Subject to (b) of this subsection, to satisfy subsection (5)(a) of this
section, when the client of institutional or HCB waiver services, or that
client's community spouse, is the annuitant, the annuity must:
(i) Name the states as the remainder
beneficiary, for at least the total amount of services covered under medicaid,
paid on behalf of the client of institutional or HCB waiver services;
and
(ii) The remainder beneficiary
must be listed in the annuity in the:
(A)
First position;
(B) Next position,
after the community spouse, and any minor or disabled children; or
(C) First position, if either the community
spouse, or any minor or disabled children, or a representative for such
children, named as beneficiary in the first position under (a)(ii)(B) of this
subsection, transfers the right to receive payments from the annuity for less
than fair market value.
(b) When the community spouse is the
annuitant, the community spouse, or the community spouse's estate, cannot be
named as remainder beneficiary under (a)(ii)(A) of this subsection.
(c) If a change of circumstance requires a
change in beneficiary designation under (a) of this subsection, the agency or
the agency's designee reevaluates the annuity's beneficiary
designation.
(7) Actuarial life expectancy is determined by tables that are published by the office of the chief actuary of the Social Security Administration.
WSR 13-01-017, recodified as §182-516-0201, filed 12/7/12, effective 1/1/13. Statutory Authority: RCW 74.04.050, 74.04.057, 74.08.090, 74.09.500, 74.09.530. WSR 09-06-048, § 388-561-0201, filed 2/25/09, effective 4/1/09; WSR 08-20-117 and 08-21-083, § 388-561-0201, filed 9/30/08 and 10/14/08, effective 4/1/09.
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