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Louisiana Medicaid Eligibility Manual Eligibility Factors

Reissued October 21, 2025 Page 18 of I-1670 Replacing January 27, 2025 Revised/added text indicated by underscore Deleted text indicated by “**” amounts, with no deferred or balloon payments.

Applicants or their responsible or authorized representative will be responsible for providing documentation from the financial institution for verifying qualifying IRS annuities. Absent such documentation, the purchase of the annuity will be considered a transfer for less than fair market value which is subject to penalty. The full purchase value of the annuity will be considered the amount transferred. Even if the purchase of an annuity is not treated as a transfer, if the annuity or income stream from the annuity is transferred, it may be subject to a penalty except when transferred:

• To or for the spouse’s sole benefit;

• To their child who is under age 21 or blind or disabled; or

• To a trust established solely for the benefit of an individual under 65 years of age who is disabled.

Consideration of Income and Resources from an Annuity

Even when an annuity is not penalized as a transfer of resources, it must still be considered in determining eligibility, including spousal income and resources, and in the post eligibility calculation.

Count income or resources derived from an annuity in determining eligibility.

I-1675 UNCOMPENSATED VALUE

The uncompensated value of an asset is the difference between:

• FMV at the time of transfer (less any outstanding loans, mortgages, or other encumbrances on the resource); and

• The amount actually received for the asset.

The uncompensated value cannot exceed the amount that would have been counted if the asset had been retained.

To determine the uncompensated value, first determine the amount of compensation and the Fair Market Value.