Monthly Archives: October 2009
Get Your Legal and Financial Houses in Order
(1) Health and Financial Documents, (2) Death and Distribution Documents, and (3) Elder Care Plan. These are not necessarily in order, but should be accomplished at the same time and as part of the same comprehensive Elder Care Plan created with a qualified Elder Care attorney.
Health and Financial Documents:
These are generally the Health Care Proxy (known sometimes as a Durable Power of Attorney for Health Care), the Financial Power of Attorney, the Living Will, the Designation of Guardian, and the DNR. The purpose of these documents is to evidence in writing the wishes and decisions of the loved one themselves vis-à-vis health care and financial decisions, so that the burden is lifted from the caregiver and/or the loved one’s family.
For a loved one diagnosed with Alzheimer’s disease, or other similar progressive disease, issues of health care will dominate the rest of his or her life. At the beginning, decisions may be easy because they can still be made by the parent diagnosed with the disease. However, as the disease takes its course, the parent will slowly (although sometimes quite quickly) be unable to make these decisions for himself or herself. The Health Care Proxy (or otherwise in some fashion known as a Durable Power of Attorney for Health Care) is used to name an alternative decision maker for health care purposes. If the parent becomes unable to make his or her health care decisions, then the Agent under the Health Care Proxy would be able to make those decisions. Without a Health Care Proxy, on the other hand, the hospital, nursing home, long-term care facility would have to rely on the decisions of the spouse and if there is no spouse, the unanimous decisions of the children. However, if the hospital, nursing home, long-term care facility found reason to doubt the motive or sincerity of the spouse, or if there was disagreement among the children, or there was no one else to make these health care decisions, then the hospital, nursing home, long-term care facility may insist upon a guardianship to sort out the differences. This is not a good solution. In fact, this is not any solution. This is an example of what happens when you don’t plan properly.
Going hand-in-hand with the Health Care Proxy is the Authorization for Release of Health Information Pursuant to HIPAA, or otherwise called the HIPAA Privacy Release. HIPAA, or the Health Insurance Portability and Accountability Act provides, in small part, that a person’s personal medical information is private to him or her and may not be disclosed by certain health care providers, without being authorized to do so by the patient. This document is extremely important when facing disability issues, such as Alzheimer’s disease, since without it and without the loved one’s consent the health care provider would be powerless to release, much less discuss, the private medical information.
The financial Power of Attorney (either “Springing” or not) is similar to the Health Care Proxy, to wit: it names an alternative decision maker for financial purposes. A standard Power of Attorney is effective the moment that it is signed by the necessary parties, whereas the “Springing” Power of Attorney is effective upon some occurrence in the future. That occurrence is typically the principal’s mental disability as noted by the principal’s doctor(s).
The Living Will is a document which evidences the maker’s intent to either be kept alive by heroic and life-sustaining measures in the event he or she has no hope of survival without such measures. Or, the Living Will evidences the maker’s intent to be kept off of and away from the same heroic and life-sustaining measures. Many people believe that a Living Will is only necessary if you do not want to be “kept alive on a machine,” but what if you do want to be kept alive and no one knows. Use the Living Will to make sure that everyone knows.
The Designation of Guardian is a document whereby it expresses the maker’s selection for Guardian if all other planning fails. In a Guardianship proceeding the selection of Guardian is left to the Judge. Although the Judge will still make the final decision, it would be nice if the Court knew that the incapacitated person had a preference for Guardian and evidenced that preference in a Designation of Guardian before he/she became incapacitated.
And finally the DNR – or Do-Not-Resuscitate Order. There are two kinds: A Hospital DNR, or one that is issued while the person is in a hospital or other facility, and the Non-Hospital DNR, or one that is issued while the person is not in a hospital or other facility. Whether the person needs a Hospital DNR or a Non-Hospital DNR, one this is absolutely clear – this is not a document that can be requested of or provided by an attorney. A DNR can only be issued by a doctor, and so the family must discuss this issue with the doctor and medical staff. If the medical staff believe that it is appropriate, then they will work with the family to have a DNR issued.
Death and Distribution Documents:
These would be the Will, Trusts, and the burial fund. The Will and any Trusts should be self-explanatory – they are used to make sure that assets remaining after the parent dies are passed down to whomever they are intended, at the most minimal of costs and effort. Trusts are also used in connection with Elder Care Planning, which I will discuss in the next section.
Burial funds are very important since now is the time to create them. Waiting for the parent to become incapacitated is not going to help with this inevitable decision. Burial must take place. It is better to set it up now, and pay for it, while the parent is alive and well and can make his or her decisions. Of course, if the conversation will add unnecessary stress to an already frail mind and body of the parent, then don’t have the conversation. But, still set up the burial fund with your preferred funeral home. As with Trusts, burial funds are useful in Elder Care Planning, especially as it relates to Medicaid planning. In that context, the only thing to keep in mind about burial funds is that in order for them to be exempt from Medicaid’s reaches, the funds must be placed in an irrevocable “Medicaid compliant” burial account or pre-need funeral arrangement.
Elder Care Plan:
This usually entails a comprehensive plan to arrange for and coordinate the elder parent’s appropriate living arrangement. This may be at home with a home health aide or attendant, or in a nursing home, or anything in between. The question that is most often posed is this … how can we pay for the care without either spending all of our money or losing our home? These are good questions, especially after spending the better part of an adult lifetime earning and saving the money. The bottom line is Medicare and Medicaid. The third part of “GET YOUR LEGAL AND FINANCIAL HOUSES IN ORDER” is sometimes the most important. The reason is because this part must be answered by a qualified Elder Care attorney, who if he/she is truly qualified and knowledgeable would be able to capably assist with both Part One (Health and Financial Documents) and Part Two (Death and Distribution Documents) of “GET YOUR LEGAL AND FINANCIAL HOUSES IN ORDER”.
With that said, a qualified Elder Care attorney will help the family arrange for the appropriate living arrangements, will advise the family on the selection of home health care agency, and may work toward getting Medicare, Medicaid and other government benefits as applicable and appropriate. Medicaid planning is not inappropriate per se – as in wrong – but it must be appropriate for the client and his/her circumstances and needs. There are many tried and true techniques and planning options in getting Medicaid to pay for the home care or the nursing home care. But, because Medicaid is a need-based welfare program, the applicant must qualify both medically and financially. Medically qualified merely means that the applicant is in need of home care or nursing home services and Medicaid agrees. Financially qualified means that the applicant has no more than a certain level of assets and/or income, and has not made any transfers that would otherwise disqualify the applicant from Medicaid benefits. The level of assets and/or income changes depending on whether home care or nursing home care is needed, and the types of transfers that would disqualify an applicant are complicated and best explained by the qualified Elder Care attorney.