Importance of Durable Powers of Attorney for Healthcare and Finance
Posted by Donna Mae Scheib on June 21, 2019
Importance of Durable Powers of Attorney for Healthcare and Finance
A durable power of attorney for healthcare and finance is a combination of two legal documents allowing you to designate a trusted individual to make either medical or financial decisions on your behalf when you are incapacitated. The word “durable” refers to how these documents are actionable during incapacitation, which would disqualify other powers of attorney. Depending on the state, the person acting on your behalf may be called your “surrogate” or “proxy” for the healthcare power of attorney particularly, or your “agent” or “attorney-in-fact” for either document. State laws also differ in legally binding ways to sign the forms.
The durable power of attorney for healthcare is an advance directive assigning a surrogate to direct your medical care. The surrogate can communicate your treatment preferences to healthcare providers. A durable power of attorney for healthcare may supplement a living will, another form of advance directive that gives instructions on your treatment preferences in your own words. Either form of the advance directive may supplement Physician Orders for Life-Sustaining Treatment (POLST), a document actionable among emergency responders (whereas advance directives are not) available to patients likely enough to die within one year.
The durable power of attorney for finance assigns an agent to make financial decisions such as paying your bills and taxes, managing your accounts and mail, and making other transactions. The financial power of attorney may supplement your last will and testament, the document organizing the transfer of your estate after death so that the agent can manage your finances while you live and leave no question about your soundness of mind.
Both of these forms are separate so that your healthcare and financial agents can focus on what they do best, and both are recommended to adults of all ages, but especially seniors, to ensure your wishes are met with minimal conflict. This article will explain what durable powers of attorney for healthcare and finance cover and how to make them.
Why You Should Make Durable Powers of Attorney for Healthcare and Finance: Coverage
Both kinds of durable powers of attorney stand apart from the documents they supplement by communicating your wishes under a broader range of circumstances. Durable powers of attorney for healthcare may share the same form as living wills depending on your state, and they permit surrogates to give instructions on many of the same matters, including:
- Whether you wish to receive Cardiopulmonary Resuscitation (CPR) or not; a separate Do Not Resuscitate (DNR) order can require any facility to not administer it, if desired
- The option to use mechanical ventilation or tube feeding when you cannot breathe or eat (respectively) on your own; these come with short- or long-term options depending on the permanence of a patient’s unconscious state
- The choice to use antibiotics, antiviral medications, or dialysis
- Whether you wish to solely receive palliative (comforting and pain reducing) care
- The option to donate your organs in the event of terminal conditions
However, powers of attorney fundamentally differ from living wills in that they apply to all manner of incapacitation. Living wills are only actionable in the event of terminal illness, vegetative states, or other end-of-life conditions –in other words, not applying to temporary loss of consciousness or responsiveness as powers of attorney do. Medical surrogates may also control access to your medical records and your admission and discharge from hospitals.
Durable powers of attorney for finance apply whether you become incapacitated, have difficulty making your own decisions, or leave home for long enough periods (through such means as travel or military service) that you need someone to look after your financial matters. They permit agents to do the following with your finances:
- Organize and respond to mail, including payment of bills
- Pay taxes
- Make real estate and banking transactions
- Sell assets to pay for other expenses
- Assist in Medicaid planning
The durable power of attorney for finance allows you to specify a full range of options for how your agent will carry out these actions or not, just as the durable power of attorney for healthcare allows you to specify whether you want full, partial, or no treatment. Written instructions, either on the forms directly or in separate living wills, ensure that agents make informed decisions; the next section will discuss how to enforce your wishes effectively.
How to Make Durable Powers of Attorney
Durable power of attorney forms are available free online; you may consider actually consulting an attorney about such technical matters as whether it must be witnessed and notarized in your state. You must be of sound mind when filling in the form, meaning that you understand (and have preferably discussed with your chosen agent) what the document entails and that you are capable of making the decision.
Your medical surrogate may be a guardian, spouse, adult child, sibling, close friend, or any other trusted individual above the age of 18 outside of your healthcare providers. Your financial agent may be any such loved one or even an attorney or accountant, who would likely have more financial knowledge. Durable powers of attorney for healthcare and finance alike permit you to designate a secondary, alternate agent using the same protocol. You are allowed to choose the same person for each document, but only consider this if you trust them to handle both healthcare and finances effectively.
Revoking either form requires the destruction of the original and the creation of a new form or a formal revocation document for everyone with your original on record when you do not intend to make a new one. Destruction is not sufficient on its own because other copies exist and will be assumed valid. Agents are also protected under the law as long as they act in “good faith”, meaning in accordance with your stated wishes.
Durable powers of attorney for healthcare can mean the difference between receiving the care you want and facing unwanted treatments. Durable powers of attorney for finances can mean the difference between keeping your finances and real estate afloat and entering into financial difficulties you are unable to fix. If you have any of the medical or financial needs outlined above, you should seriously consider making both.
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