Utah uses its own life expectancy table.

ANNUITY RULES

According to the Utah Department of Health Medicaid Manual § 554-1 entitled Treatment of Annuities:

A. Annuities Purchased or Changed on or After February 8, 2006

1. Any payment received from the annuity is income, regardless of whether the annuity itself is countable as an asset or is considered a disqualifying transfer.
2. Consider an annuity changed on or after February 8, 2006, if any action is taken on or after that date that changes the course of payments or the treatment of the income or principal of the annuity. These actions include additions or principal to the annuity, elective withdrawals, requests to change the distribution of the annuity, elections to annuitize the contract, or similar actions. This change requires the State to be named as the preferred remainder beneficiary.
3. Count the annuity as an available asset unless:

a. The annuity is considered a disqualifying transfer and the penalty period is not finished (if the penalty period is finished and the applicant or recipient still owns the annuity, the annuity may be considered an available asset);
b. The annuity has been annuitized and constitutes an employee benefit annuity that cannot be surrendered; or
c. The annuity meets all of the following conditions:

• The annuity is irrevocable and cannot be assigned to another person;
• The issuing entity is an insurance company or other commercial company that sells annuities as part of the normal course of business;
• The annuity provides for equal monthly payments and does not provide for a balloon or deferred payment of principal or interest;
• The State Medicaid agency is irrevocably named as the primary beneficiary of the annuity, second only to the surviving spouse or minor or disabled child, not to exceed the amount of benefits paid by Medicaid;

4. For Family-related Medicaid programs, all annuities are countable resources if the funds are available, even if the annuities are considered retirement funds or plans. If the annuity qualifies as an employer-based retirement plan, and the client would have to quit working to receive the funds, the funds are not available. See Sec. 521-11.

5. The annuity is considered a disqualifying transfer unless:

a. The payment options was selected, or the latest change to the annuity was made, prior to the individual’s, or the individual’s spouse’s look-back date;
b. The annuity is a qualified employee benefit annuity, and the State Medicaid agency is named as the remainder beneficiary in the first position for at least the total amount of Medicaid paid on behalf of the annuitant or the annuitant’s spouse;
c. The annuity:

• The annuity meets all the requirements in (3)(c) above;
• The annuity will return the full principal and interest within the annuitant’s life expectancy; and
• The State Medicaid agency is named as the remainder beneficiary in the first position for at least the total amount of Medicaid paid on behalf of the annuitant or the annuitant’s spouse.

d. The annuity is a third party annuity. See Sec 554 for definition.

6. The uncompensated value of an annuity that is considered a disqualifying transfer is an amount equal to the remaining payments due from the annuity or the outstanding principal amounts due.
7. The date of the transfer is the date the payment option was selected on the annuity or the date the annuity was changed so the annuity could no longer be surrendered, whichever date is later.

Learn more by visiting Utah’s Medicaid Policy Manual.

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