North Carolina uses the life expectancy tables published by the Office of the Actuary of the Social Security Administration, here.

ANNUITY RULES

According to the North Carolina Department of Health and Human Services Age, Blind and Disabled Medicaid Manual, section MA-2240 entitled Transfer of Assets:

1. The following requirements apply to all annuities whether they are determined to be a resource or not:

a. The State of North Carolina’s Medicaid Program must be named remainder beneficiary in the first position for all annuities created on or changed on or after November 1, 2007 (Note: This requirement also applies to annuities held by the spouse of the a/r).

i. If there is a community spouse and/or any child under age 21 or a disabled child of any age when the purchase or change takes place, the North Carolina Medicaid Program may be named in the next position after those individuals.

2. Assets of an applicant/recipient used to purchase or change an existing annuity on or after November 1, 2007, will not be treated as a transfer of assets if, in addition to North Carolina’s Medicaid Program named as a beneficiary, the annuity meets the following conditions (Note: this requirement does not apply to an annuity held by the applicant/recipient’s spouse):

a. The annuity was sold by a bank, insurance company, or other person engaged in the business of the sale of commercial annuities, AND
b. The annuity is considered either:

i. An individual retirement annuity, or
ii. A deemed individual retirement account (IRA) under a qualified employer plan, OR

c. The annuity is purchased with proceeds from one of the following:

i. A traditional IRA; or
ii. Certain accounts or trusts which are treated as traditional IRAs; or
iii. A simplified retirement account; or
iv. A simplified employee pension account; or
v. A Roth IRA, OR

d. The annuity meets all of the following requirements:

i. The annuity is irrevocable and does not allow the policy holder to assign or transfer the ownership or income of the policy to a third party; and
ii. The purchase price of the annuity is expected to be paid back in full during the actual or expected lifetime of the annuitant.
iii. The annuity provides for payments in equal amounts during the term of the annuity with no deferral and no balloon payments.

Visit the North Carolina Adult Medicaid Manual to learn more.

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