No annuity is exempt from being counted as an available resource UNLESS procured immediately before submission of the Medicaid application. Anytime I hear use of annuities as a pre planning tool it throws up a red flag of bad information being provided.
For Married couples an alternative to the gifting route you could utilize a Medicaid Qualifying Annuity to shelter some costs. Medicaid qualification criteria look to the income of the applicant and the assets of both spouses. One requirement of this annuity is that the State of Washington must be named as the primary beneficiary before the community spouse. Another downside to using an annuity to convert resources to income is that the income that comes in the name of the community spouse will most likely preclude you from requesting an income allocation from the applicant to the community spouse.
For single person, under Medicaid rules, you are not able to utilize an annuity in the traditional sense of sheltering your excess assets by converting them into a stream of income. However, since you will be gifting some of your assets, which will cause a period of ineligibility, you can minimize your penalty by annuitizing a sum which, when added to your monthly income, will give you adequate income to meet your monthly long-term care costs.