Healthcare Power of Attorney

Posted Monday, September 24, 2018

Nobody expects the Spanish Inquisition! Right? Nobody expects accidents and unexpected illnesses either. Accidents or illness can happen to anyone at anytime. Unfortunately, these things usually happen when we least expect them and often at the most inconvenient times.

Consider this scenario:

Your spouse is in Mexico for 10 days with some friends. You are celebrating some much needed alone time, but hit your head in the shower. Who can make decisions for you if you are incapacitated? Daughter? Nope. Brother? Nope. Mom or Dad? Nope.

Because of HIPAA and other laws, only your spouse can make decisions for you if you are unable. But Mexico’s phone system stinks, and 10 days seems like an awfully long time. Do you remember the Terri Shiavo disaster in Florida about 11 years ago?

What can be done? Today…before you hit your head.. you might need to consider Power of Attorney documents. Again, this requires an estate planning attorney and we can help point you in the right direction. These documents are economical to draft in most cases and take very little time, yet are extremely critical to your financial and medical worlds.

Generally speaking, a power of attorney is a legal document that allows you to designate a person you trust to make decisions on your behalf. There are a bunch of different power of attorney documents to choose from and each has it’s own purpose. Lets talk about some of the different types of power of attorney documents and hopefully help you to understand why you might need to consider having these documents drafted and on file before you hit your head in the shower.

There are two main issues that you will want to make sure you have covered, so you will need two separate documents: a health care power of attorney and a financial power of attorney.

A health care power of attorney, also known as a medical power of attorney or a durable power of attorney for health care, is a type of health care directive — a document communicating your wishes regarding your medical care if you are ever too ill or injured to speak for yourself. Your estate planning attorney can draft the medical power of attorney forms and assist you in completing them properly. When you complete your medical power of attorney forms, you will name a person you trust as your “health care proxy”, “agent”, “attorney-in-fact”, “health care surrogate”, or something along those lines depending on where you live. Your health care agent will work with your health care providers to ensure that your health care wishes are carried out.

While you are already working with you attorney on your medical power of attorney forms, you might as well make life for yourself and your chosen agent a little bit easier by having another health care directive drafted — a living will. This will spell out your health care instructions to your chosen agent and your health care providers. If you want to make matters even more simple, the health care power of attorney and living will can be combined into a single document — the advance health care directive.

There’s one other thing you need to consider when talking to your attorney about drafting this document: HIPAA laws. HIPAA laws are kind of a big deal and are taken very seriously. They will not allow a health care provider to disclose your health care information to unauthorized people. Your health care power of attorney needs to include language that refers to your agent as your “personal representative”. Your power of attorney should also include a HIPAA clause that explains that your agent is also your personal representative for the purpose of health care disclosures under HIPAA. Your estate planning attorney can assist you in making sure your advanced health care directive is kosher with the federal HIPAA laws.

Now that we’ve looked at why you need to have a health care power of attorney drafted and on file, let’s talk about getting your financial power of attorney squared away too.

With a financial power of attorney, also known as a durable power of attorney for finances, you give a person that you trust the authority to handle financial transactions for you. You can designate a limited power of attorney for a single transaction, such as making a large asset purchase like a house or a car. However, what we are talking about here is a comprehensive power attorney that will allow your “agent” to manage your financial affairs on your behalf if you become incapacitated. Because it’s comprehensive, its called a “durable power of attorney for finances”.

Your don’t need your agent to be a financial expert, just someone who is trustworthy and has plenty of common sense in their noggin. With a financial power of attorney, they can do anything finance-related from the mundane to the complex, from sorting your mail and depositing checks to filing your tax returns. They can even hire professionals (paying them from your bank account) to help them out.

Have you ever head the phrase: don’t keep all of your eggs in one basket? Well, in this case, you don’t want to keep all of your power of attorneys in one document. Your health care power of attorney document will include all sorts of personal information about your feelings and wishes regarding your health care. Do you really want your banker to know that information about you? On the flip side, your health care providers probably don’t need to know private information regarding your finances.

Even though your power of attorney should be two separate documents, its perfectly ok to to name the same agent in both documents. In fact, it makes good sense to have a single agent for the sake of continuity. If you choose to name two separate agents, that’s fine too! Just make sure they are two people who can work together for the sake of carrying out your wishes.

Whatever you decide, just remember that these power of attorney documents are simple and economical to have drawn up by an estate planning attorney. If you’d like a bit of guidance in this area, just give us a call and we can point you in the right direction.