Words of Praise

“I had the opportunity to read your book and loved it. This is a book I would be happy to give my clients, as I believe it would assist them in understanding the process. This is a wonderful book!”

- Christina Stone, JD
Attorney, certified specialist estate planning, trust and probate law
La Habra, CA

About the Book


Chapter 1: Great Uncle Pat

Chapter 2: Grandmother
Chapter 5: Scammers and Shysters alert
Chapter 8: Barbara, The Good Daughter
Chapter 11: Choosing a Medi-Cal Advisor

Chapter 5 – Scammers and Shysters alert

Generous provisions for married couples

As explained earlier, specialized immediate-pay annuities can be used effectively in some situations to achieve Medi-Cal eligibility and preserve assets for a Well Spouse.

Unfortunately, many seniors have been led to purchase ‘Medi-Cal qualifying’ annuities that in too many instances were not appropriate for their respective financial situations. Here are some guidelines for evaluating annuities for Medi-Cal use.

1. If an immediate annuity is the best method to achieve Medi-Cal eligibility, the annuity may be established at the time of need, i.e., in conjunction with filing for benefits. Usually there is little benefit to consumers to establish beforehand an annuity for Medi-Cal purposes.

2. Annuities must conform to Medi-Cal requirements: a) contract must be irrevocable; b) must conform to Medi-Cal’s life expectancy tables; c) must liquidate entirely over proscribed life of annuity.

3. Medi-Cal has announced it is actively pursuing authority to recover from annuity payments to beneficiaries.

4. A Medi-Cal advisor who says he/she processes Medi-Cal applications for free and then places client assets into immediate annuities is not being entirely truthful. The issuing insurance company pays the agent a commission for establishing the immediate annuity. If the agent does not charge fees for processing Medi-Cal applications and relies only on annuity commissions for compensation, a conflict of interest exists since annuities are often not the sole, best solution for achieving Medi-Cal eligibility.

5. On a positive note, immediate annuities allow applicants with non-pension money – also known as non-qualified money – to achieve parity under Medi-Cal with applicants with significant irrevocable pension income. Thus, the professor with $7,000 of monthly pension does not have an unfair advantage over his twin brother who amassed $700,000 in stocks, bonds and real estate. The entrepreneurial brother may convert his capital into irrevocable annuity income that resembles his brother’s academic pension.

6. Medi-Cal applicants who own deferred annuities can usually annuitize their annuity contracts – convert them to payout or immediate pay status – with the current issuing company. Transferring the deferred annuity to another company’s immediate-pay annuity generates a commission for the agent involved but is often unnecessary to meet Medi-Cal requirements.


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