Whether an annuity that satisfies the condition in Section 1396p(c)(2)(B)(i) must name the State as the first remainder beneficiary in order to avoid Section 1396p(c)(1)'s transfer penalty

QUESTION PRESENTED In determining the Medicaid eligibility of a married institutionalized individual, the assets of both spouses are normally considered. Under 42 U.S.C. § 1396p(c)(1), an institutionalized spouse is penalized (i.e., becomes ineligible for benefits) to the extent the married couple’s assets were transferred for less than fair market value during a specified look-back period. Section 1396p(c)(1) provides that for purposes of this transfer penalty, “the purchase of an annuity shall be treated as the disposal of an asset for less than fair market value unless ... the State is named as the remainder beneficiary in the first position for at least the total amount of medical assistance paid on behalf of the institutionalized individual.” 42 U.S.C. § 1396p(c)1)(F)@). Section 1396p(c)(2), however, lists a number of conditions under which “{aJn individual shall not be ineligible for medical assistance by reason of paragraph (1).” Id. § 1396p(c)(2). One such condition is where “the assets ... were transferred to the individual’s spouse or to another for the sole benefit of the individual’s spouse.” Id. § 1896p(c)(2)(B)(). The question presented is: Whether an annuity that satisfies the condition in Section 1396p(c)(2)(B)G@) must name the State as the first remainder beneficiary in order to avoid Section 1396p(c)(L)’s transfer penalty.