In a definitive decision released on October 2, 2012, the 2nd Circuit Court of Appeals affirmed a prior determination by the Federal District Court for the District of Connecticut that held that a non-assignable immediate annuity purchased by a "Community Spouse" in fact properly converted an "excess resource" to a stream of income. I had previously discussed the District Court's opinion in this prior post from December 2011.
In the case -- Lopes v. Department of Social Services, the Court of Appeals gave great deference to the brief filed by the Department of Health and Human Services in support of Mrs. Lopes' claim that the a Community Spouse's purchase of an immediate non-assignable annuity was consistent with the Medicaid's purpose of supporting the indigent and protection Community Spouse's from impoverishment.
Although New York's Department of Social Services have not taken the aggressive posture as we have seen in Connecticut, the 2nd Circuit's ruling -- which is legal precedent for New York as well as Connecticut -- provides us with the assurance that spousal annuity planning remains a viable strategy for New York Medicaid planning.
The Court's full opinion can be found here.