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or SSDI disability criteria • If there is a community spouse and/or minor or disabled child, the State must be named as the remainder beneficiary in the second position after the community spouse or minor or disabled child • If the State has been named as a remainder beneficiary after a community spouse and/or a minor or disabled child, and any of those individuals or their representatives dispose of any of the remainder of the annuity for less than fair market value, the State must then be named beneficiary in the first position • The requirement is waived if the individual has purchased a long-term care insurance policy that protects the annuity as approved by the Indiana Long-Term Care Partnership (ILTCP). As remainder beneficiary, the State is entitled to receive the total amount of medical assistance paid on behalf of the applicant for medical assistance. Additional Criteria Applicable ONLY to the person in LTC: The rules explained below do not apply to annuities owned by or transactions made by community spouses. There are 2 separate sets of criteria that, if met by the terms of the annuity, will not result in a transfer penalty. The first set will be referred to as “soundness” criteria. The second set will be referred to as “class exceptions”. The annuity does not have to meet both sets of criteria – it must meet the criteria from either set. The purchase of an annuity or transactions completed will not result in a transfer of property penalty if the following conditions, referred to as soundness criteria, are met: • The annuity is irrevocable and non-assignable in that it cannot be cashed in, nor ownership transferred to another individual or entity, and • The annuity is actuarially sound in that it is expected to return full principal and interest within the institutionalized individual’s life expectancy, and • The annuity provides payments in approximately equal amounts with no deferred or balloon payments. To determine actuarial soundness for promissory notes, loans and annuities use the Life Expectancy Table at the end of this document. If the individual does not (will not) receive compensation in the amount of the full purchase price within lifetime (or within the contract’s specified time period if shorter than the life expectancy), the uncompensated amount is the difference between the purchase price and the amount that the annuity will pay out to the individual within the individual’s life expectancy, or term of the contract if shorter than life expectancy. Ownership of an annuity in one of the following classes of retirement annuities will not result in a transfer of property penalty: • An individual retirement annuity (according to Sec. 408(b)) of the Internal Revenue Code of 1986 (IRC), or