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Questions? | Policy Manual | Training Information

• Padma, the MA-LTC applicant, purchased (owns) the annuity.
• She meets all MA and MA-LTC eligibility requirements as determined throughout the LTC Courses Sequence.
• Her annuity was annuitized on the 30th of the CM-8 months as was determined in Annuities 101 and recorded on Padma’s Annuity Data Worksheet (DHS-5532).
• Her annuity is not revocable and is not assignable, as was determined in Annuities 101 and recorded on Padma’s Annuity Data Worksheet (DHS-5532).

• Padma funded the annuity with a court-ordered settlement, per her completed DHS-5143.
• She is the payee of the annuity.
• An MA-LTC annuity transaction took place with the annuitization of the annuity eight months ago on the 30th of that month.
• The annuity is annuitized.
• The annuity was not funded with a funding source that meets an exception.

To Do: check the “1” checkbox in the “Annuity Transfer Evaluation Method field” found on the Annuity line of Padma’s DHS-5590 (MA-LTC Case Checklist). Method 1 is the only transfer evaluation method, per a policy change. A bulletin was issued regarding this update. The DHS-5590 will be updated in the future to reflect this.

1. The annuitized cash value was $100,000, which was indicated on the documentation provided with the annuity contract (page 24).

2. The total annuity payout is $99,437.12. This was calculated using the following steps:

a. A yearly amount is $8,136 ($678 X 12 months).

b. Use the length of term for the monthly annuity payments, 7.92 years, because this figure is less than Padma’s life expectancy figure (age at annuitization is 75) of 13.10 years. Calculation for term length figure is 7 years x 12 months = 84 months + 11 months = 95 months / 12 = 7.91666 years. Round up to 7.92 years.

c. 7.92 years X $8,136 yearly payment + $35,000 balloon payment.

3. The annuity payout is less than the annuitized cash value.

The uncompensated transfer amount is ($100,000 – $99,437.12) which results in an uncompensated transfer amount of $562.88.

Remember in this case there was a balloon payment so the transfer evaluation would have stopped there and you would have applied that uncompensated amount to determine the penalty period.