Our goal is to make the crisis planning process as simple and streamlined as possible. We take pride in being a national leader and trusted resource for elder law attorneys. If you have any questions not addressed on this page, please contact our office. We’ll be more than happy to help you navigate any landmines that come with Medicaid planning.
Q: How Do I Work With You?
A: We understand time is very important when dealing with Medicaid benefits. Therefore, obtaining an annuity through us is an easy and streamlined process. Our Benefits Planners will take your client’s case facts and work with you to determine the most appropriate plan to help them gain Medicaid eligibility. Simply contact us to get started.
Q: Why should I work with you?
A: We have over 25 years of crisis Medicaid planning experience, working with elder law attorneys and helping build practices across the nation. We have earned the distinct reputation of the “Pioneer of Medicaid Compliant Annuities.” Thousands of elder law attorneys trust us with their clients’ cases. Learn more on our Testimonials page.
Q: What services do you offer?
A: We are a full-service, boutique crisis planning firm. We offer one-on-one case guidance and Medicaid planning case analysis. We want to be your strategic partner for all things related to crisis planning. All our services can be found on our services page.
Q: What products do you offer?
A: We are the nation’s leading provider of Medicaid Compliant Annuities. We also offer irrevocable funeral expense trusts, whole life insurance, refusal letters, tax-deferred annuities, and other products. All our products can be found on our products page.
Q: Where is Krause Financial Services located?
A: Our office is in De Pere, WI, but we work nationwide. We are available Monday through Friday, 7:00 a.m. to 5:00 p.m. Central Time, through phone and email.
Q: Are you familiar with my state’s regulations?
A: Yes – we are up-to-date on all state-specific case decisions, laws, regulations, and updates. Our goal is to empower elder law attorneys across the nation by providing customized support, education, products, and services.
Q: Do you work directly with my client to complete the annuity purchase?
A: While we are happy to assist your clients with any questions they may have regarding the annuity purchase, the elder law attorney is our preferred point of contact.
Q: I am a licensed insurance agent. Can I sell your annuities myself?
A: Yes – you can get appointed through The Krause Agency to sell our annuities. Please visit www.thekrauseagency.com or call us at (800) 255-1932 for more information.
Q: How can I learn more about Medicaid planning?
A: As the national leader, we take pride in our education services and our position as a thought leader in the elder law industry. Our tireless research allows us to leverage our knowledge into comprehensive, practical educational resources. Visit our education page for more details on our available resources.
Q: What if my client receives a denial?
A: In the event of a denial, simply contact the Benefits Planner who assisted you with your case and provide a copy of all supporting documentation for review. Most denials can be remedied at the caseworker level, however should your case require a fair hearing, our office can provide fair hearing support and expert testimony.
Q: What is a Medicaid Compliant Annuity (MCA)?
A: An MCA is a spend-down tool utilized by elder law attorneys to help their clients qualify for Medicaid benefits. It is a Single Premium Immediate Annuity (SPIA) with added restrictions to meet the requirements of the Deficit Reduction Act of 2005. The SPIA is irrevocable, non-assignable, provides equal monthly payments, and contains zero cash value. Additionally, the SPIA must be structured to be “actuarially sound” in accordance with each state’s Medicaid manual, and must name the state Medicaid agency as primary beneficiary (in most cases). Visit our Medicaid Compliant Annuity page for information.
Q: Who owns the annuity? To whom is the annuity payable?
A: The parties of an annuity contract vary depending on the case facts. In most cases involving a married couple, the community spouse is owner and payee. In cases involving a single person, the applicant for Medicaid is both the owner and payee. In most cases, the only time the owner and payee of contract are different individuals is when utilizing the “Name on the Check Rule.” This is where an institutionalized spouse names his or her community spouse as the payee of the annuity funded with IRA funds.
Q: What is the minimum premium amount to fund a Medicaid Compliant Annuity?
A: Most of our insurance carriers require a minimum premium amount of $5,000. For details on the carrier requirements in your state, please contact our office directly.
Q: What is the minimum term length for a Medicaid Compliant Annuity?
A: Most of our insurance carriers require a minimum term of two months, though they may also enforce premium maximums for short-term annuities. For details on the carrier requirements in your state, please contact our office directly.
Q: What happens if the owner of the annuity predeceases the term?
A: If the owner predeceases the annuity term, the named beneficiary will receive the remaining amount in the annuity. If the state Medicaid agency is the primary beneficiary, it will be entitled to recover funds up to the amount expended on behalf of the institutionalized individual. Any remaining benefits will be distributed to the contingent beneficiary. Different insurance carriers have different beneficiary payment options, so please contact us directly for further information on a specific case.
Q: What happens if the owner of the annuity outlives the term?
A: An annuity will make a fixed number of payments, which end at the completion of the annuity term. If the owner outlives the term of the annuity, the annuity contract will automatically terminate upon the final payment.
Q: Is my client able to rollover his or her IRA into a Medicaid Compliant Annuity?
A: In most cases: Yes, your client can rollover or transfer his or her IRA into an MCA. The IRA cannot be annuitized and it must contain a cash value. To verify your client qualifies for this option, or if the rollover/transfer is appropriate for your client, please contact us directly.
Q: Is my client able to rollover his or her existing annuity into a Medicaid Compliant Annuity?
A: In certain situations: Yes, the client can request a 1035 Exchange to have the annuity transferred into a new contract. The annuity must be a deferred or variable annuity in order to perform the 1035 Exchange; it cannot be annuitized. Your client may also be able to conduct a 1035 Exchange to transfer the cash value of an existing life insurance policy to an MCA. To verify that your client qualifies for this option, please contact us directly.
Q: My state allows promissory notes. Why use a Medicaid Compliant Annuity instead?
A: If your client has cash assets, it makes more sense to use an MCA because it will be controlled by the insurance carrier rather than a family member. This would place less responsibility and stress on the family member as the insurance carrier guarantees that monthly payments distribute as scheduled. Promissory notes can also be problematic if the family member designated undergoes a disruptive event (e.g. death, bankruptcy, divorce). Finally, an MCA requires much less long-term management by the elder law attorney than a promissory note.
Q: Does the state Medicaid agency need to be listed as primary beneficiary on the annuity?
A: In almost all cases: Yes, the state Medicaid agency must be listed as primary beneficiary. Exceptions may apply in certain cases. Please contact us directly for details on your specific case.
Q: What are the fees associated with purchasing a Medicaid Compliant Annuity from you?
A: We never charge a fee when it is not necessary; therefore, all planning and case advising is complimentary. A processing fee may apply if a client decides to proceed with the annuity purchase. The processing fee varies depending on the term length and premium amount of the purchased annuity. Many of our other products do not require a fee at all – this includes single premium whole life insurance policies, funeral expense trusts, and tax-deferred annuities. Contact us directly for specific questions.
Q: Are you able to assist with existing, non-compliant annuities?
A: Yes. If your client owns an existing annuity that is not compliant with Medicaid regulations, we are happy to review the contract to determine the best course of action. In many cases, we can assist in selling the non-compliant annuity on the secondary market. Visit our Valuation of Non-Compliant Annuities page for more information.
Q: Do I have to work with an elder law attorney?
A: While not required, we strongly encourage you work with an elder law attorney. We are unable to provide legal advice. If you would like a recommendation for an elder law attorney in your area, please contact us.
Q: How do I begin a case with you?
A: Simply contact us. If you’d like, you may fill out our online quote request form or download one of our intake sheets. If you’d prefer to speak with someone directly, you may call our office at (866) 605-7437 and ask to speak with a Benefits Planner. If you’ve worked with us before, you may also email the Benefits Planner you’ve worked with in the past.
Q: What information do you need to obtain a quote?
A: We require the client’s financial information (income, cost of care, assets), as well as their state of residence and date of birth. On a case-by-case basis, we may require additional information to provide a more appropriate proposal for your client. You may also complete an intake form to verify you are providing the correct information.
Q: Will you assist me in determining the most beneficial annuity investment amount and term?
A: We can provide as much assistance as needed. If you already know the annuity investment amount and term you are seeking, our Benefits Planners can quickly provide you a quote and the necessary application paperwork. If you would like a recommendation regarding the annuity investment amount and term, our Benefits Planners are able to provide comprehensive annuity proposals tailored to your client’s situation. All comprehensive proposals are complimentary with no obligation to proceed.
Q: How quickly will I get the proposal back?
A: We know timing is everything in these cases. Upon receipt of all the necessary information, we will return your annuity quote or comprehensive proposal within one business day. If we receive your request for a quote or a proposal, and we need some additional information prior to proceeding, we will contact you as soon as possible.
Q: My client is ready to proceed with the annuity purchase – what is the next step?
A: If your client is ready to proceed with the annuity purchase, please send the annuity application documents, as well as the funds, to our office for processing. Please contact one of our Benefits Planners for the necessary paperwork and instructions.
Q: How long does it take to receive the policy back?
A: Once our office receives the application and funds, the insurance carrier will begin the process of issuing the policy the next business day. Once we receive the policy contract back from the carrier, a copy is faxed to your office immediately, and the originals follow in the mail. Policies are typically issued within 5-7 business days from the time of submission. This time-frame varies based on the insurance carrier and the method of funding the annuity.
Q: My client died before the annuity term ended and the state Medicaid agency was named primary beneficiary. What happens now?
A: We can handle the death claims process for your office. First, we notify the insurance carrier of the death. They require a death certificate to begin the claims process. The insurance carrier will notify the State of its interest in the MCA and a claim package is sent to the State and the contingent beneficiary. It is next up to the State to send a reimbursement or release letter to the insurance carrier. Once received, the insurance carrier will settle the State’s claim, accept the release, and distribute the MCA balance (if any) to the contingent beneficiaries.
Q: Why do we charge fees?
A: For certain insurance products we offer, our company is not compensated by the insurance company. Rather, the insurance company charges us a fee to initiate the transaction. In these cases, we charge a small processing fee.
We don’t charge a fee if we don’t have to, therefore, all proposals, quotes, and case guidance are complimentary and nonobligatory. A fee is only due if the client chooses to proceed with the plan and submits an annuity application to our office. Most annuities 48 months in length or longer do not require a processing fee. Additionally, we offer many products that require no fee at all, such as whole life insurance policies, funeral expense trusts, and tax-deferred annuities.
We are committed to providing you and your client unparalleled customer service. On all cases, we work diligently to ensure the annuity being purchased conforms with state and federal guidelines. We expedite shipping of funds and application materials to the insurance company for policy issuance. Should your client receive a denial, we offer fair hearing support at no additional charge.
Q: Is there a fee for the planning?
A: No – all proposals, quotes, and case guidance are complimentary and nonobligatory. A fee may only be due if the client chooses to proceed with the plan and submits an annuity application to our office. Most annuities 48 months in length or longer do not require a processing fee.
Q: Who pays the fee?
A: The fee is paid by your client.
Q: Do I include the fee in the annuity investment amount?
A: No – the fee must be in a separate check or wire.
Q: Where do I send the fee?
A: The fee may be mailed to 1234 Enterprise Drive, De Pere, WI 54115. If you would like to initiate a wire please contact us at [email protected] or contact your benefits planner.
Q: How is the fee determined?
A: The fee is determined based on the term and investment amount of the annuity. If the annuity has a term of less than 48 months, the fee will be based on our fee schedule.
Q: How do I get a copy of the latest fee schedule?
A: You may contact us at [email protected] or contact your benefits planner.
Q: Why do you charge fees?
A: For certain insurance products we offer, our company is not compensated by the insurance company. Rather, the insurance company charges us a fee to establish the annuity. In these cases, we charge a processing fee.
The processing fee covers the costs of our operation and allows us to hire staff committed to providing you and your client unparalleled customer service. Further, on all cases, we work diligently to ensure the annuity being purchased conforms with state and federal guidelines. We expedite shipping of funds and application materials to the insurance company for policy issuance. Should your client receive a denial, we offer fair hearing support at no additional charge.
Completing the Annuity Application
Q: Do I need to work with a local insurance agent to purchase the annuity?
A: No – a third party insurance agent is not required to be part of the transaction when purchasing a product through our office.
Q: How many insurance carriers do you work with? Can my client choose the carrier they purchase the annuity from?
A: We work with multiple insurance carriers. The insurance carrier options available to your client are dependent upon the state in which your client resides and the term and premium amount you are seeking. We always strive to provide quotes based on the insurance carrier best suited to your client’s needs.
Q: Are there different annuity applications or can I always use the same one?
A: Some insurance carriers have separate applications that are dependent upon the term and premium. Additionally, each insurance carrier may update their required application documents at any time. To verify that you are utilizing the appropriate documents, we always recommend contacting a Benefits Planner prior to submitting an annuity application.
Q: Do you need the original application documents or will a copy suffice?
A: Requirements vary from carrier to carrier. If original copies are required or if your client is submitting checks with the application, they should be mailed to our office using UPS, FedEx, or USPS. Most clients choose to overnight the documents to expedite the process. For specific questions regarding your client’s case, contact us directly.
Q: What if my client makes a mistake on the annuity application?
A: Your client may either re-complete the page, or they may strike out the incorrect text, input the correct information, and initial the change. Please do not use white-out or correction fluid. When in doubt, please send a copy of the mistake to a Benefits Planners for specific guidance prior to mailing an original application.
Q: There are several spots on the application for an agent or witness – what should I do there?
A: Unless you are a licensed insurance agent appointed with the insurance carrier from which your client is purchasing the annuity, please leave all “agent” or “witness” lines blank.
Q: Should my client use a personal check or a cashier’s check to fund the annuity?
A: Both are acceptable; however, we strongly recommend using a cashier’s check to fund the annuity. This ensures the funds are immediately drawn from the client’s account, which is important when purchasing the annuity at the end of the month. When using a personal check, we cannot guarantee when the check will be deposited and the funds drawn from the account. Additionally, if a personal check is returned NSF, your client may incur additional charges from the insurance carrier. In many cases, your client also has the option of wiring the funds.
Q: Can I choose the dates of the contract?
A: We can often accommodate specific “effective” and “first payment” dates; however, we can never guarantee it. If the requested dates are earlier than the date we receive the application, we are sometimes charged an additional back-dating fee from the insurance carrier. In other cases, we are restricted by the carrier’s policies and cannot back-date policies at all. To be conservative, we always recommend getting the application documents to us before your desired “effective” and “first payment” dates. Please contact us directly for your options regarding a specific case.
Q: What is the last day of the month you need to receive the annuity application?
A: We typically need to receive the application and funds no later than the second-to-last business day of the month, but this may vary between insurance carriers. Please contact us directly for guidance on your specific case.