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

ANNUITY RULES

According to the Rules of Tennessee Department of Human Services Division of Medical Services, chapter 1240-3-3 entitled Technical and Financial Eligibility Requirements for Medicaid:

1. The annuity must be treated as a transfer of assets unless it is irrevocable and non-assignable, actuarially sound, and provides payments in equal amounts during the term of the annuity, with no deferral or balloon payments.
2. The purchase of an annuity will be treated as a transfer of assets for less than fair market value unless:

a. The State of Tennessee is named as the remainder beneficiary in the first position for at least the total amount of medical assistance paid on behalf of the annuitant. This provision applies to annuities purchased by an applicant or by a spouse, or transactions made by the applicant or spouse.
b. If there is a community spouse and/or a minor or disabled child, the State is named in the next position after those individuals.

3. In addition to the provisions above, an annuity purchased by or on behalf of the annuitant who has applied for medical assistance will not be treated as a transfer of assets if the annuity meets any of the conditions in part (a) or part (b) or all of the conditions in part (c) below:

a. The annuity is:

i. An individual retirement annuity according to section 408(b) of the Internal Revenue Code of 1986, or
ii. Deemed Individual Retirement Account (IRA) under a qualified employer plan according to section 408(q) of the IRC, or

b. The annuity is purchased with proceeds from

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

c. The annuity meets all of the following:

i. The annuity is irrevocable and non-assignable,
ii. the annuity is actuarially sound, and
iii. The annuity provides payments in equal amounts, with no deferred or balloon payments.

ANNUITY DECISION

• Billie Ray v. State of Tennessee, Department of Human Services

Visit TennCare’s website to learn more.

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