1Amending the act of June 13, 1967 (P.L.31, No.21), entitled "An
2act to consolidate, editorially revise, and codify the public
3welfare laws of the Commonwealth," further providing for
4treatment of life estates, annuities and other contracts in
5determining eligibility for medical assistance.

6The General Assembly of the Commonwealth of Pennsylvania
7hereby enacts as follows:

8Section 1. Section 441.6 of the act of June 13, 1967
9(P.L.31, No.21), known as the Public Welfare Code, added July 7,
102005 (P.L.177, No.42), is amended to read:

11Section 441.6. Treatment of Life Estates, Annuities and
12Other Contracts in Determining Medical Assistance Eligibility.--
13(a) As a condition of eligibility for medical assistance, every
14applicant or recipient who owns a life estate in property with
15retained rights to revoke, amend or redesignate the remainderman
16must exercise those rights as directed by the department. The
17acceptance of medical assistance shall be an assignment by
18operation of law to the department of any right to revoke, amend
19or redesignate the remainderman of a life estate in property.

20(b) Any provision in any annuity or other contract for the

1payment of money owned by an applicant or recipient of medical
2assistance, or owned by a spouse or other legally responsible
3relative of such applicant or recipient, that has the effect of
4limiting the right of such owner to sell, transfer or assign the
5right to receive payments thereunder or restricts the right to
6change the designated beneficiary thereunder is void.

7(c) In determining eligibility for medical assistance, there
8shall be a rebuttable presumption that any annuity or contract
9to receive money is marketable without undue hardship.

10(d) Upon approval by the Federal Government of any required
11State plan amendment implementing this subsection and
12notwithstanding subsections (b) and (c), a commercial annuity or
13contract purchased by or for an individual using that
14individual's assets will not be considered an available resource
15if the annuity meets all of the following conditions:

16(1) Is an irrevocable guaranteed annuity.

17(2) Guarantees to pay out principal and interest in equal
18monthly installments with no balloon payment to the individual
19so that payments are paid out over the actuarial life expectancy
20of the annuitant, as set forth in life expectancy tables
21approved by the department.

22(3) Names the department as the residual beneficiary of any
23funds remaining due under the annuity at time of death of the
24annuitant, not to exceed the amount of medical assistance
25expended on the individual during his or her lifetime.

26(4) Is issued by an insurance company licensed and approved
27to do business in this Commonwealth.

28(e) This section applies to all annuity, life insurance and
29other contracts entered into on or after the effective date of
30this section and to life estates owned by any individual who

1applies or reapplies for medical assistance on or after the
2effective date of this section. Notwithstanding the foregoing, a 
3life insurance policy with a total face value of not more than 
4ten thousand dollars ($10,000) shall not be included as a 
5countable resource for the purpose of determining the insured 
6person's eligibility for medical assistance.

7Section 2. This act shall take effect in 60 days.